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Insights: Indulgence

Once the soul domain of local jewelers, precious stones can now be purchased wholesale online
Matt Kramer
From the Print Edition:
Dennis Hopper, Jan/Feb 01

(continued from page 1)

Tanzanite became a specialty of Tiffany's, which gave the stone its name. Good examples are getting rarer, as the source is just one spot in the Merelani Hills of Tanzania. Prices reached as high as $1,000 a carat in 1984, then plunged to $480 in 1993.

"Right now, I'm paying about $630 a carat for tanzanite. That's my wholesale cost," says Brockman. "But keep in mind, I'm talking about a really good stone of multiple carats. Remember, an investment stone, so-called, is anything over five carats for something like tanzanite. Also, the price per carat increases with bigger stones of the highest quality."

I contact Judi Borenstein in Miami. She's probably the archetype of how precious stones are bought and sold by savvy private buyers. Borenstein is a collector who sells to other collectors. "I started collecting tanzanites and other precious stones more than a decade ago," she says. "I really got swept up in their beauty, especially tanzanites. My late husband and I would go to gem shows, wholesale dealers -- anywhere we could get really fine stones.

"A few years ago, we decided to start selling some of what we bought. And, oh, we'd bought a lot!" she says with a laugh. "But at good prices, you should know." Borenstein specializes in tanzanites, which she sells on eBay under the name Her stock seems exceptional. And she's frank about pricing.

"Although I don't say so on the individual listings, if I'm selling one of my big tanzanites, say something between 5 and 10 carats, the price works out to about $550 a carat," she says. When I tell her that a jeweler friend of mine says the going price is almost $100 a carat above that, Borenstein says, "That's right. But I didn't pay that much 10 years ago. So I can sell for less now."

So what should a precious stone lover/collector look for today? The range is greater than you might imagine, but among the best picks are tsavorites, a stone that in color resembles fine emeralds but lacks their inclusions, or flaws. Big stones are very rare and command $3,000 a carat for exceptional top-quality tsavorites.

Another top pick would be the vast category called fancy sapphires, which covers everything in the sapphire family other than the classic blue sapphire. It's a good choice because sapphires are extremely hard stones, second only to diamonds in hardness. Because of this, they are ideal for rings. And the colors are phenomenal, ranging from the famous classic blue to a dazzling yellow to electric pinks and violets in the fancy class. Prices vary depending on size and color, but a five-carat stone in, say, a rare pink might cost $2,000 a carat.

And what about the Big Three: diamonds, rubies and emeralds? Of these, white diamonds are the easiest to buy, if only because the grading system has become so specific and universally accepted. White diamonds, more than any other precious stone, have become an easily quantifiable commodity.

Insiders know one thing that's rarely mentioned: the diamond grading system has more grades than are needed. So minute are the differences that separate color grades and clarity, that on any given day a grader's judgment might add or subtract thousands of dollars of value to any stone. For example, a diamond deemed to have a color grade of "D" (the highest) and IF (internally flawless) clarity one day -- might be color graded "E" (the second highest) with VVS1 (very, very small inclusions) clarity the next day.

How can this happen? It's simple. Even though there are reference stones against which to compare, grading is still done by eye (rather than machine), and thus relies on human judgment. And every grader has good as well as bad days. Above all, it's because the gradations themselves are overly fine, especially at the highest end of the scale. "It is usually easy enough to tell which is the worse of two bad wines," the late British wine authority Andre Simon once said, "but it is extremely difficult to tell which is the better of two good wines." So it is with diamonds.

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