Canada man 'swallowed $20,000 diamond'

A man suspected of swallowing a $20,000 (£12,600) diamond is being held in custody in Windsor, Canada, until it passes through his system, police say.

Richard Matthews allegedly swapped the gem for a fake and ate the real one.The incident occurred almost a week ago but the stone has not appeared despite numerous visits to the bathroom.Mr Matthews, 52, was initially being fed fibre-rich foods, but is now eating whatever he wants in order to speed the process, Sgt Brett Corey said.

An X-ray revealed a pair of artificial diamonds, known as cubic zirconiums, in Mr Matthews' intestines. But the translucent quality of the real diamond means it does not appear in screening.The suspect is eager to get the ordeal over with, Sgt Corey added, and is co-operating with police.

The 1.7 carat jewel was taken from Precision Jewellers in the Canadian province of Ontario.Mr Matthews has been charged with theft and breach of court conditions. He is also wanted on warrants in Toronto.

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Pearl earrings left in drawer since 1970s fetch £1.6m at auction

A pair of pearl earrings that were kept in the back of a desk drawer in Wiltshire for 35 years because the owner did not like them have fetched £1.6m at auction.

The jewellery was a gift from a Romanian king to his mistress, who left the pearls to a British friend on her death in 1977. She had no idea of their worth and consigned them to the drawer as they struck her as too big and ostentatious to wear. They were inherited by her nephew, who casually showed them to an auctioneer when he was selling some other items.

Their emergence has generated huge interest from collectors around the world and their worth in the catalogue was estimated at £80,000-£120,000. Following frenetic bidding at the Woolley and Wallis sale-rooms in Salisbury, Wiltshire, on Thursday, the earrings easily broke the £1m mark, snapped up by a private collector who wished to remain anonymous. The market for such jewellery has boomed in recent years because of interest from China and the Middle East.

Jonathan Edwards, of Woolley and Wallis, said: "The bidding just went berserk. The chap who bought them just would not stop. He wouldn't give up and was very determined to get them. It is a hell of a price.

"The couple who sold the earrings were hanging around at the back of the room. They couldn't believe how much they went for. There were absolutely thrilled and had big smiles at the end of the sale. It is an awful lot of money for them."

Edwards said the couple had turned up with a few bits and pieces to sell, then mentioned the pearls almost as an afterthought. "They had been kept in a box in a desk drawer since the late 70s. The man's auntie never liked them. The couple had no idea of their value and never gave them a second thought. They were blown away when I told them the estimate."

Edwards said King Carol II of Romania had bought the pearls for his mistress, Elena. Carol renounced his claim to the throne in 1925 in the wake of the scandal following the romance and he and Elena lived in exile in Portugal. After Elena's death some of her jewellery was left to a British friend she knew in Portugal. The unnamed woman brought them back to Wiltshire but consigned them to the drawer.

The pearls have been examined by the Swiss Gemmological Institute, which called them a "very exceptional treasure".

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Goldman Sachs upgrades Petra Diamonds to 'buy'

Petra Diamonds (LON:PDL) was upgraded by one notch to ‘buy’ by Goldman Sachs, which said shares in the FTSE 250 diamond group underperformed over the past five weeks.“We believe this is unwarranted given growth plans remain on result, we upgrade the stock to a buy,” the investment bank said in a note today.

While Goldman upgraded the stock, Northland Capital reduced its target price for Petra due to a decline in grades and increase in costs in the third quarter.However, the broker upheld its ‘buy’ recommendation on the stock, saying that Petra’s investment plans and ramp-up of production at the Finsch mine in South Africa offers shareholders increased returned from a medium risk capex.

The new target of 185 pence, donw from 200 pence previously, still represents a substantial premium to the current share price of 150 pence, which gives it a market cap of nearly £800 million.In its third quarter report, Petra revealed that production jumped 126 percent to 622,509 carats, while revenues rose US$98 million compared with the revenues of US$101.4 million posted for the entire first half of 2012.

While production from Finsch was ahead of expectations at 343,051 carats, grades at the Cullinan mine slipped to 31.5 carats per hundred tonnes (cpht) from 34.8 cpht in the first half, which was partly offset by an increase in tonnes.

In addition, output from other operations undershot forecasts.Northland analyst Ryan Long still expects Petra to hit its full year production target of 2.2 million carats, however, he said lower rough diamond prices are likely to reduce revenues.“The Finsch Mine was a sparkling performer compared to a group of assets that underperformed,” said Long.

“We continue to believe in the ability of Petra’s management and the quality of the assets despite the setbacks encountered in 2012.”

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'Mirror Diamond' necklace yours for $24.4m

A "Mirror Diamond" necklace bearing five Mughal empire pendant diamonds with emerald drops has been offered for private sale at a price of US$20 million (NZ$24.4m), auction house Bonham's has revealed.

It said the Mughal Mirror Diamond necklace was an extraordinary example of the colourless, rough diamonds discovered in the ancient Golconda mines in India during the height of the Mughal empire across the Indian Subcontinent in the 16th and 17th centuries, which were reserved for royalty.

At 28 carats, the central stone is the largest mirror or table-cut diamond known to survive, and the five diamonds (ranging from 16 to 28 carats) are the largest known matching set of table-cut diamonds from the Mughal 17th century. It is most likely that the diamonds belonged to a Mughal emperor.

"The presentation of the Mughal Mirror Diamond necklace, containing five extraordinarily well matched mirror diamonds, is causing great excitement in the world of jewellery scholars as well as potential buyers," Bonhams CEO and International Head of Jewellery Matthew Girling said in a statement.

To both Mughal emperors and Indian maharajas, the quality and size of the gem were of paramount importance, and table-cut diamonds were valued for their clarity and size above all else.

At the time, gem-cutters only sought to remove areas with cracks and inclusions, so the shape of the rough gem determined the final outline of the polished stone. As a result, gems had an irregular and asymmetrical form as the cutter was striving for the maximum size possible.

Weighing approximately 96 carats in total, the skilfully rendered table-cut diamonds were designed to emphasise the beauty of the stones without sacrificing their size.

The table-cut description refers to a thin diamond section with a flat top and bottom, where the diamonds have also been faceted around the edge. This faceting acts as a border around the irregular shape of the diamond, to produce a refractive brilliance.

The GIA (Gemological Institute of America) has speculated that the five near colourless diamonds were cut from the same crystal.The Columbian emerald drops were added at a later date, probably late 18th/early 19th century.

Pendants such as the necklace were an important element of Mughal jewellery and were used as turban ornaments and armbands.

Many of India's royal pieces of jewellery were subjected to the 19th and early 20th century fashion for replacing and recycling old jewels with new, Western settings or re-cutting into brilliant diamonds. And as the Mughal Empire weakened and collapsed, many of the royal jewel collections were dissipated or lost.

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Why a diamond is a Hong Kong widow's best friend

Hong Kong businessman Kennedy Tam always wanted to travel the world. When he died suddenly of a stroke in 2010, his wife Freda decided death would not stand in his way.Since that day, Freda has taken Kennedy on trips to New York, Canada, Shanghai and Turkey.

"We are always together. Even at work he is always near me," said Freda, 48.As she talks, Freda looks lovingly down at the necklace around her neck. "This is Kennedy," she says. "He is my diamond."She is not speaking metaphorically. When he died at the age of 52, Kennedy was cremated and his ashes made into a synthetic diamond.

It's an option more people in Hong Kong may have to consider in future as the city, with its rapidly ageing population of 7.1 million and annual death rate of 50,000, faces up to a shortage of places to bury its dead.Burial plots are scarce in the city - one of the world's most densely populated spaces - and often exorbitantly expensive, with permanent spots starting at 36,000 US dollars, or around 770 US dollars for a short-term stay of six years in a government plot, after which the body has to be exhumed and the remains cremated.

The other main option of keeping cremated ashes in urns at a columbarium - a storing place for urns - is less expensive, costing around 330 dollars at a government facility. However, the price rises to between 6,200 and 42,500 US dollars at a private columbarium.But with 90 per cent of people choosing cremations, even this option is unable to keep pace with demand and there are an estimated 12,000 deceased people now on waiting lists for columbarium places.The government says a new columbarium will be ready by summer which will provide some 43,000 niches - roughly equivalent to the number of cremations in one year.

It has also identified 24 potential new columbarium sites. However, many of these have already met with opposition in the community because of the belief that presence of the dead drags down property prices due to their bad feng shui.Recently, the government began promoting other options, such as remembrance gardens for scattering ashes and an internet memorial service in the absence of real grave.

In 2007, it lifted a 22-year ban on scattering ashes at sea, and began offering free boat trips for the purpose. Since then, sea burials have increased fourfold, from 160 in 2007 to 660 in 2011.But these numbers are a drop in ocean when you consider the death rate, says Professor Lily Kong of the Department of Geography at the University of Singapore.

"Space is at a premium and the growing death rates present a challenge to the city authorities in accommodating the dead amidst the challenges of housing the living," Kong said.Kong, who has studied the subject, said the biggest obstacle for alternatives like sea burials was cultural practices and beliefs."The notion of returning to the earth upon death is deeply entrenched in Chinese belief systems," Kong said.

"Without a proper burial, the traditional Chinese belief is that the soul will not rest, giving rise to a 'hungry ghost' rather than a venerated ancestor."Moving away from burials to cremations had involved a "significant cultural shift", but taking the further step of disposing of the ashes at sea presented even greater cultural obstacles, with many people believing it showed "disrespect and lack of care for one's ancestors", said Kong.

A funeral director, speaking on condition of anonymity because of the sensitivity of the subject, said sea burials were unpopular because people did not like the idea of a parent or spouse floating around in the sea."They prefer to have a place to visit, something real, and to keep their loved ones close," he said.Space burials, in which ashes are shot into space, have also proved unpopular in Hong Kong for similar reasons, he said, adding he knew of only one in the last 10 years.

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Diamonds Are a Great Way to Diversify: Expert

Diamonds are an attractive option for investors looking to diversify portfolios because they don't move in relation with other assets such as commodities and stocks, according to David Riedel, President of equity research firm Riedel Research Group.

“Over the past decade cross-asset correlations have nearly doubled, (but) diamonds have exhibited very low correlations to other assets making them an attractive source of diversification. They have almost no correlation to anything else – commodities, gold, equity markets,” Riedel told CNBC on Wednesday.

In 2011, the RapNet Diamond Index (RAPI) for one carat polished diamonds rose 19 percent outpacing gold,which rose 10 percent. And supply constraints are expected to take diamond prices even higher in the coming years, says Riedel.

He estimates demand for diamonds will grow 50 percent between now and 2015, driven by consumption in the United States, China and India, while production will rise by just 24 percent.“Diamond mines tend to be most productive near the surface, and like a funnel become less productive as you go deeper,” says Riedel, which restricts supply.

Demand out of the U.S., which currently accounts for 40 percent of global diamond purchases, is set to strengthen alongside the pick up in its economic recovery, he said.The rise in household income and the young population in India and China will support demand out of these two countries, which are already the world’s top two consumers of gold jewelry, says Riedel.

“We expect cultural trends throughout emerging markets to drive demand for diamonds further. A major trend increasing demand among the Chinese is a desire to display wealth,” he said.

Addressing the growing supply of synthetic diamonds, which are available at a fraction of the cost of natural diamonds, he says the former will not impact demand for the latter.“There is a growing supply of synthetic diamonds but there is a certain cache and investment value in natural diamonds and we think that will continue.”

Sotheby's annual spring sale of “Magnificent Jewels” in Hong Kong this week highlighted Asia’s booming interest in diamonds. The highlight of the auction was the sale of an 8.01-carat blue diamond ring for $12.7 million - the second highest price per carat for a blue diamond at an auction.

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Paragon Diamonds reports consistent results from Motete micro samples

 Paragon Diamonds(LON:PRG) said results from the final part of its micro-diamond sampling programme at Motete, Lesotho showed results consistent with the previous samples.The sample, from the western end of Motete Dyke, included 17 macro-diamonds (greater than 0.5mm/600μm) and a single diamond greater 1.18 mm.

The overall sample’s combined results of 2,655 diamonds included 131 macro-diamonds and six diamonds greater than 1.18 mm from 1,355 kg of samples. These are now being interpreted to establish a modelled grade for the Motete Dyke.

Paragon owns 83.75 per cent of Motete Dyke. The micro diamond analysis results in 2012 indicated that an in-situ grade of up to 1 carat per tonne is likely.

Paragon added that the road access to extract a bulk sample is proceeding with six kilometres of access track built to within one kilometre of the main dyke. Mining equipment will arrive and begin sample extraction by the end of March.

Paragon said it has also negotiated a contract to drill approximately 1,400 metres of NQ core at depth for a series of 12 intersections into the dyke up to 150 metres below surface. This drilling, in addition to providing further sample material, is intended to demonstrate the continuity of the dyke at depth, it said.

Meanwhile, Ntate Bataung Leleka, former Principal Secretary to the Lesotho Ministry of Natural Resources, is to be a consultant to the Lesotho subsidiaries, while Alastair Garner and Radiant Diamond Consulting will be professional diamond valuers to the company on a non-exclusive basis.

Francesco Scolaro, chairman, said: "Our management team continues to deliver positive results in a timely manner. I am encouraged with these results and remain confident that Lesotho will deliver a revenue stream for the company."

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Gem Diamonds 2011 Revenues +49%

Gem Diamonds reported record earnings in 2011 driven by higher rough prices and increased production at its high-value Letšeng mine in Lesotho. Revenues grew 49 percent year on year to $395.6 million and attributable net profit more than tripled to $67.7 million. Revenues include about $67.4 million worth of diamonds from the company’s downstream activities. Cost of sales increased 11 percent to $196.8 million.

“[The year] 2011 saw several exceptional diamond discoveries at Letšeng, including the 550 carat Letšeng Star (pictured), and we continue to see strong demand for our high quality diamonds from both developed and emerging markets, despite the backdrop of challenging times for the global economy,” said Clifford Elphick, the chief executive officer of Gem Diamonds.

Gem Diamonds noted that rough diamond prices rose sharply in the first half of 2011 but fell by about 30 percent in the third quarter due to the deepening Eurozone financial crisis and tightened bank liquidity, before stabilizing in the fourth quarter. Prices for rough diamonds overall ended the year approximately 16 percent higher than at the end of 2010, the company reported.

Elphick explained that there has been some restocking in the cutting centers following the U.S. holiday season, which was reflected in the continued strengthening of prices at both the Letšeng and Ellendale sales held so far in 2012. He added that there will likely be some volatility in rough prices in the first half of 2012 given the global economic uncertainties and as the market goes through a period of consolidation after the exceptional growth experienced since the 2008 financial crisis.

“From the middle of 2012, based on current supply expectations, rough diamond prices are expected to improve,” Elphick said.

Sales at Letšeng rose 58 percent to $300.6 million during 2011. The company sold 107,700 carats from the mine as the average price of sales from the mine grew 29 percent to $2,776 per carat. Sales included the 550 carat Letšeng Star which was sold into a partnership arrangement for $16.5 million, where Gem Diamonds will benefit directly from the sale of the resultant polished diamonds.

Letšeng’s production increased 24 percent to 112,367 carats during the year. The mine launched its $280 million expansion project in January, designed to raise annual production to about 200,000 carats by 2014. 

Sales at Gem Diamonds’ Ellendale mine in Australia rose 15 percent to $89.4 million with the average price of the goods sold rising 54 percent to $731 per carat. The increase was driven by sales of Ellendale’s fancy yellow diamonds to Tiffany & Co, where the average price rose 53 percent to $4,409 per carat.

Ellendale’s production fell 28 percent to 120,302 carats in 2011. Gem Diamonds reported that processing challenges continued to be experienced at Ellendale and that the company continues to consider its options for the mine.

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Colored diamonds becoming investors' best friend

Yellow, pink and blue diamonds are catching the eye of investors around the world, according to dealers and industry insiders.

Natural colored diamonds make up only 1% of global production, which gives them "unquestionable value," said Bruno Scarselli, who represents the third generation of U.S.-based colored diamond specialist Scarselli Diamonds.

"There is a tremendous demand for yellow diamonds, but also blue and pink," Scarselli told Reuters at the Baselworld watch and jewelry show.

"There are not enough diamonds to satisfy one-tenth of the new billionaires that every month are created in China," he said as he handled a $9 million ring featuring a 12-carat internally flawless blue diamond and two smaller pink stones.

Scarselli said he expects financial institutions to be increasingly attracted to the diamond industry, which has traditionally been in the hands of family businesses.

"This is associated with the fact that currency is losing its value, government bonds are a risk, and nations are losing wealth."

Colored diamonds are piquing investors' interest because they are more difficult to find in nature than white diamonds, industry spokesmen said.

Simon Zion, whose father founded Hong Kong-based diamond company Dehres Ltd, said blue diamonds are coveted not because they are the rarest but because there are not many left after a boom in demand.

Investors' relationship with diamonds has been rocky.

The first diamond investment trust, set up by investment firm Thomson McKinnon in the 1980s, was wound up after a slump in the market.

The first publicly traded fund to invest in diamonds, Diamond Circle Capital Plc, has lost more than half of its value since it started trading in 2008.

At the beginning of 2011, investors seeking shelter from a weakening dollar were drawn back to the diamond market, expecting diamonds to go the same way as gold, said Martin Rapaport, whose diamond indexes are used as a reference by the diamond industry.

"In fact, the dollar went up and the store-of-value investment argument became weaker," he said.

Excess liquidity in India, one of the biggest diamond players, pushed up the price of diamonds in the first half of 2011, triggering a wave a panic among Chinese buyers who stocked up on diamonds fearing the price would keep rising.

"Then when credit became tighter in India, the thing that was fuelling the fire settled down," said Rapaport.

He expects the diamond market to be stable for the first half of 2012 as overstocking works itself out, before starting to rise in the second half.

Frédéric de Narp, president and chief executive of U.S. diamond miner and jeweler Harry Winston, said he will increase prices as he anticipates diamonds will go up again.

A Chinese love affair with diamonds has fueled a growing trend for watchmakers to decorate their timepieces with the gems.

Diamonds of all shapes and colors sparkled in the crystal windows of the Basel fair, mainly aimed at buyers from China, the Middle East and the United States.


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Challenges Facing the Australian Diamond Industry

2012 diamond debut
The diamond market of 2012 is not replicating that of 2011, when prices soared for more than half of the year. Instead, this year’s market is off to a lukewarm start following a correction that began unfolding in Q4 of 2011. These conditions are widely expected to remain, at least through the first quarter.

Emerging nations – especially India and China – are widely regarded as essential growth markets for diamonds, and are expected to be drivers for strong industry performance going forward. Yet there is some concern about a slowdown in these economies.

Almost all of Australia’s diamonds are exported, with the majority of Argyle production going to India. The Indian diamond market, is not especially robust. Last year, while the prices were up, the value of India’s diamond imports increased, however, the volume decreased, with Q4 showing severe weakness.

India has been grappling with inflation and a weak rupee, which has resulted in USD-priced goods becoming much more expensive. The rupee is recovering, but the Indian government is also looking for cash. One means of getting it is through the new two percent tax on polished diamond imports announced last month.

How this tax will impact the market remains to be seen. During the first eleven months of 2011, India’s polished imports rose to $18.8 billion.

Since India is a manufacturing hub, much of what flows in heads back out to other other markets.

Asian buyers appear laid back recently. Chinese sales were steady for last month’s new year festivities. However, concerns about a potential economic slowdown are believed to be behind cooling sentiments among suppliers and consumers there.

Likewise, the US is the largest diamond consumer. Demand was satisfactory for the December holiday season, but with festivities gone, enthusiasm for diamond purchases appears to have also simmered down.

The Luxury Consumption Index shows that luxury consumer confidence slid in January, and average spending was also reportedly down in Q4.

The Eurozone crisis has weakened the appetite for diamonds in that region.

Lately discussions about the diamond market are accompanied by the word “caution.” The shakey demand picture illustrates a good reason why.

“Diamonds are a luxury product,” IBISWorld says, and “demand tends to fall disproportionately heavily during times of economic downturn and rise sharply when economic conditions and consumer confidence improve. Investors should factor this into their decisions.”

Diamond outlook
With increased production and rising prices, IBISWorld foresees a profitable turnaround for Australia’s industry. Diamond and gemstone mining sits at the top of its list of growth industries, and is expected to rake in nearly $600 million this year.

Rio Tinto warns of significant risks related to the Eurozone crisis, the threat of contagion to developing nations – especially China – and the potential for financial crisis. However, the company also expects a revival in the diamond market as excess stocks are cleared, noting that medium run consumer demand looks positive.

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Petra Diamonds first half profit falls

Petra Diamonds on Tuesday reported a loss after tax of US$26.7 million, after a profit of $24.5 million previously, as its results for the six months ended December 2011 were affected by unrealised foreign exchange losses of $35.7 million.

The London listed diamond miner pointed out, however, that $16 million have reversed since the period end due to the strengthening of the rand. Production was up 64% to 953,553 carats.

The diamond miner reported a loss per share of 5.23 cents for the first half from earnings per share of 6.79 cents a year ago. Adjusted EPS before unrealised foreign exchange movements and non-recurring transaction costs rose to 2.46 cents from 0.86 cents previously.

Revenue was up 13% to $101.4 million due to increased production, offset by the weakening in rough diamond prices experienced since July 2011 following on from the prevailing climate of global economic uncertainty led by the Eurozone sovereign debt crisis.

Profit from mining activity grew 25% to $30.7 million reflecting the introduction of Finsch into the group from 14 September and the continuing improvement of the mines' performance under Petra management - all in turn significantly mitigated by the weaker diamond prices.

Adjusted EBITDA was 24% higher at $25.0 million.

The weakening in rough diamond prices from July to December 2011 resulted in Petra's gross revenues being approximately $23 million lower than management's expectations for H1 FY 2012.

"It is important to note that both production and sales are expected to be substantially higher in H2, due to a full six months' contribution from Finsch and the release of unusually high Group closing H1 inventory into H2 sales," the company said.

The company's first tender for H2 FY 2012 was concluded in early February and revenues of $44.4 million were achieved on the sale of 306,149 carats. In H1 Petra held three sales tenders, while in H2 five tenders are scheduled, again supporting management's confidence in substantially higher H2 revenues.

Gross mining and processing costs for the SA operations increased in Rand terms by approximately 19% due to the contribution of Finsch towards these costs, partially offset by a weakening Rand to effect an 8% increase in US Dollar terms.

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India to Show More Loose Diamonds in Hong Kong

India's Gem & Jewellery Export Promotion Council (GJEPC) today announced that the Indian pavilion at the upcoming Hong Kong Jewellery Show would include an additional location that would feature leading loose diamond dealers.

Hong Kong is a premium destination for Indian gem and jewelry exports. Last year, $10.65 billion worth of Indian manufactured diamonds, gems and jewelry were exported to Hong Kong.

GJEPC Chairman Rajiv Jain observed, "The Hong Kong Jewellery Show has always been a great platform and once again, we hope to see fruitful results for our participants. China and India, the two eastern giants, are now a formidable force to reckon with. The GJEPC looks forward to witnessing the two giants take center stage globally in gems and jewelry."

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UAE joins ban on Zimbabwe’s blood diamonds

UAE joins the international ban on the trade of ‘blood’ diamonds coming from Marange fields in Zimbabwe, Arabian Business reported on Thursday.

Dubai Multi Commodities Center (DMCC) said that the UAE has signed the U.N.-backed Kimberly Process, which controls the misuse of trading the rough diamonds to feed conflicts.

The Marange fields, which were seized by Mugabe government in 2006, are located in eastern Zimbabwe, and have the largest-known concentration of diamonds in the world.

Reports have linked Marange’s profits with human rights abuses and violence, and suggested that Zimbabwe President Robert Mugabe has profited from illegal trade stemming from the fields.

UAE stance change after the cable release
Early December, a cable from the U.S. Embassy in Zimbabwe leaked by Wikileaks alleged much of the trade passed through the Gulf.

In a statement, the DMCC said diamonds from Marange would no longer be permitted.

“We can confirm that the UAE KP office is in full compliance. The notice issued states that the ban will remain in place until further instruction from KP.”

Other signatories include the UK, US, India and Australia.

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Diamond prices goes up as demand increases

Everybody say diamonds are a girl's best friend, but they could be a man's worst enemy--if predictions of increasing prices come true.

Experts be expecting double-digit increases by the end of the year or early next year and they say prices will keep rising over the next four years.

Experts say the biggest increases will be for the really superior diamonds, with the best cut, clarity, color and size--as opposed to diamonds that are less perfect or rare.

But Jay Feder Jewelers says the increasing direction of diamond prices is not a sure thing--thanks to European and U.S. economies slowing the economy of China and India.

"The buying in Indian and Chinese markets has dried up a bit. So, it does not signify we are not expected to see price increases. We very well could, particularly if their trade starts to go one more time. Currently, we’ve seen quite a pullback from the Indian and Chinese markets," says JJ Slatkin of Jay Feder Jewelers.

The potential for price hikes doesn't seem to diffuse the sparkle in the eyes of potential future buyers.

"It's about the person I'm giving it to. And how much it would mean to them. It doesn't subject how much it costs," says Denver resident David Chung.

However others say even though a diamond is forever--a flush bank account isn't.

"Whatever would fit in my budget," says Bob Cook of Denver.

Diamond experts say India, China and the Middle East will account for 40-percent of the global diamond insist in three years.

Just six years before, they accounted for 8-percent.

Diamond-Covered iPhone 4S: Now The World's Most Expensive Phone!

Some people say that you are what you eat, and many people say you are what you use. Do you like expensive things? Are you a collector by any chance? How far would you go to own a phone that many people cannot dare to earn even in their lifetime of work and sacrifices?

Introducing the diamond collection iPhone 4, now the world's most expensive mobile phone on the planet!

This ultra expensive handset is brought to you by Stuart Hughes, the same British designer who made the iPhone 3GS Supreme (1.92 million pounds) and the iPad Supreme Gold (129,995 pounds).

What makes this particular iPhone 4 cost too much? Diamonds, of course, and lots of them! Over 500 diamonds can be found on the phone's exterior body, with a total of over 100 carats. It also comes with its own a special granite box.

Other goodies include two interchangeable diamonds which fit over the "home" button - a single cut 7.4 carat pink diamond and a rare 8 carat single cut flawless diamond. The back of the phone is plated in rose gold and the Apple logo glitters with 53 diamonds.

The phone cost $5.5 million pounds or almost $9.5 million US dollars!

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How Diamond-Studded Magma Rises From Earth's Depths

The recipe for making diamonds is no secret: Take carbon and squeeze it under the extremely high temperatures and pressures found deep inside the Earth.

The mystery lies in how the prized gemstones then get delivered from the depths to parts of Earth's crust that are accessible to miners.

According to a new study, diamonds can be carried up through the lithosphere—the crust and uppermost layer of the mantle—by dense magmas rich in carbonate.

"These melts are really quite special, because they can hold a huge amount of dissolved carbon dioxide, up to 40 to 45 percent by weight," said study leader James "Kelly" Russell, a petrologist from the University of British Columbia in Vancouver.

Previous models had suggested that gases in the magma would increase its buoyancy, helping to push the diamond-laden melt closer to the surface without destroying the precious gems.

The new lab experiments now show how molten carbonate reacts with other chemicals in Earth's lithosphere to release the gas, offering a likely mechanism for speeding up the dense magma.

"Let There Be a Gas Phase"
Natural diamond production begins deep beneath the planet's oldest continents, where Earth's lithosphere can extend to depths of 75 miles (120 kilometers), Russell said.

There, a type of material called kimberlite magma forces its way up from deeper in Earth's mantle, cracking the solid rock.

As it rises, the magma collects fragments of rocks, like floodwaters picking up silt and gravel. Some of these fragments contain diamonds.

But the diamond-containing rocks are heavy, and the magma picks up enough of them that its progress should be substantially slowed, Russell said.

Diamonds, however, have to rise quickly, or they will be destroyed as they pass through zones of intermediate pressure, where the gems can be rapidly consumed by high-temperature oxidation.

The best estimates are that, in order for the diamonds to make it, the magma must travel all the way to the surface in about 10 to 45 hours—moving at about 3 to 13 feet (1 to 4 meters) a second.

The only way for magma to rise so quickly, Russell and others have long believed, is if the melt is supercharged with gas—but nobody knew where such gas might come from.

"Prior models have been [rather] deus ex machina—let there be a gas phase," he said.

Diamonds Caught in Volcano Plumbing
In the new paper, Russell and colleagues found that as carbonate-rich magma passes through overlying rocks on its way toward the surface, it quickly dissolves those rocks' silica-rich minerals.

In high-temperature and high-pressure lab experiments, this process can start happening within tens of minutes.

The resulting mixture of molten silica and carbonate can't carry as much dissolved carbon dioxide as the original magma.

Large quantities of gas therefore bubble out, causing the magma to rise even quicker, until it reaches the surface in an explosive eruption.

More importantly for miners, long after the resulting volcano has been eroded into invisibility on the surface, its interior plumbing remains, leaving behind kimberlite "pipes" that may be rich in diamonds.

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Graff Diamonds Sues Hong Kong Pawn Shop Over Diamond Stolen in 2007 Heist

Graff Diamonds Ltd. sued a Hong Kong pawn shop seeking the return of a yellow diamond that the jewelry retailer says was stolen from a London store in 2007.

The 16.64 carat diamond was part of more than $20 million in jewelry stolen from Graff’s store on Sloane Street in London on July 5, 2007, according to the complaint in New York State Supreme Court in Manhattan.

The pawn shop, Yau On Co., submitted a stone to the Gemological Institute of America, a non-profit group based in Carlsbad, California, that sets standards for gemstone quality, analysis, grading and certification, according to the complaint.

The institute determined that the stone submitted by Yau was the yellow diamond stolen in the robbery, which had at some point been recut and reconstituted as a 16.28 carat modified cushion cut diamond, according to the Jan. 6 complaint. Yau has refused to agree to allow the institute to return the stone, which is being held in a lab in New York pending resolution of the dispute, according to the complaint.

Graff is asking a judge to declare that it’s the true owner of the diamond and to order the jewel immediately returned to the company. It also seeks the costs of the lawsuit and attorney fees.

Pawn Shop Spokesman
Danny Hung, a spokesman for Yau On and the son of the owner, said in a phone interview that he wouldn’t have bought the stone had he known its history.

Hung said he took in the diamond from someone who he didn’t identify and that it was once owned by someone wealthy in mainland China. Hung said he had a certificate for the stone that wasn’t issued by the owner’s company and that he later found out it was a stolen item from London.

Graff is preparing to raise $1 billion in an IPO in Hong Kong next year, a person familiar with the matter said in November. The company’s founder and chairman, Laurence Graff, 73, who was listed at 459 on Forbes magazine’s list of worldwide billionaires in March with a net worth of $2.5 billion, has twice set records buying gems at auction.

Diamond Earrings

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