Tag Archives: investment gems

Gem Grading: The Death of the Lightbulb and Other Brilliant Ideas

Color temperatures a various types of lighting.  5500-6500 is the Kelvin temperature of daylight.  GIA uses a 6200 Kelvin light source for diamond grading.

Color temperatures a various types of lighting. 5500-6500 is the Kelvin temperature of daylight. GIA uses a 6200 Kelvin light source for diamond grading.

by Richard W. Wise, ©2011

New Technologies May Require Changes is How We Look At Gems:

In 2007 amid little fanfare, Congress passed a law that required that the efficiency of that iconic household standby, the incandescent light bulb, be improved or perhaps accept its doom.  The bulb has been around a long time and the technology has remained virtually unchanged since it was invented by Thomas Edison in 1881.  Turns out the old bulb is a real energy waster, only 10% of the energy used is given off as light, the rest is dissipated as heat.   Though some called it the death of the incandescent light bulb, Congress merely dictated an increase in efficiency, 20% by 2014, 60% by 2020.

Though the efficiency standards do not state what is allowed, such a dramatic increase in efficiency is bound to require new technologies which are likely to mean  changes in the light spectrum produced by whatever technology replaces the old standard.  No one has given much thought to the consequences this will have in the gem trade.  The new standards are scheduled to take effect this January.

In the evaluation of quality, gemstones have been traditionally viewed under two light sources, noon daylight or more lately daylight equivalent fluorescent lighting and plain old incandescent (in the 19th Century it was candlelight).  A stone that looked good by day but muddied up under the lightbulb is taken to be inferior to one that holds its color in both lighting environments.    In 2003 I published a book, Secrets Of The Gem Trade, that divides gems into daystones and nightstones. The terms refer to gem varieties that look best under a  given source.  This seemingly bright idea may mean dramatic reductions in oil imports, but wait!  What about the gem business, what’s a connoisseur to do?

The Tea Party To the Rescue:

Well our worries may be over, just last week the House passed legislation to deny funding to the law.  Apparently the bill’s original Republican sponsor, Texas Representative Michael C. Burgess had an epiphany.  He has seen the, ah, light.  “The government has no right to tell me or any other citizen what type of bulb to use at home,”  no matter how much energy it might save says Mr. Burgess.  We have the right to waste all the energy we like in the privacy of our own bedrooms, says so in the scriptures.

But seriously folks!  Sooner or later, new, more efficient types of lighting are bound to replace the old standby.  Will there be a new standby?  Probably not.  We are pretty much at the point where the type of lighting used will be dictated by the setting that it is used in.  Call it dial a light!  At that point will gem grading light be standardized.  To some degree it already has.  Most laboratories use  some artificial version of daylight.  The Gemological Institute of America (GIA-GTL) uses a 6200 fluorescent bulb, American Gemological Labs uses a 5500 Kelvin bulb.  What is the next step?  Stay tuned to GemWise.

Book Review: The Colour of Paradise, The Emerald In The Age of Gunpowder Empires

Kris Lane

The Colour of Paradise, The Emerald In The Age of Gunpowder Empires

280 pages including appendices

ISBN: 978-0-300-16131-1

9780300161311The history of the gem trade is a difficult research topic because gemstones are very small objects of great value that have been highly sought after for millenia by rich and powerful people looking for wealth that was portable and easily concealed.  The trade itself has been controlled for centuries by minority groups, often oppressed minorities, Jews, Armenians and Indians for whom secrecy was a proven form of self preservation.  Kris Lane is a historian, a Professor of History at the College of William and Mary.  In The Colour of Paradise, Professor Lane focuses very well honed research skills on the history of the emerald, one of the rarest, most mysterious and highly valued of all gemstones.

The book contains no particularly major revelations.  Most historians of the trade are aware that India’s so-called “old mine” emeralds were, in fact, Colombian emeralds imported by the Spanish into India in the Sixteenth and Seventeenth Centuries.   Lane’s contribution is to meticulously document both the early history of Spain’s brutal exploitation of Colombia’s indigenous people and its gem wealth.  He gives us a well documented overview of early trade routes and uncovers some very interesting and original information concerning 16th Century production; methods and emerald values.

Lane begins with the 16th Century and follows emerald production in Colombia right up to the present, with a good account of politics and production into the 1990s.

All and all this well organized and well written account brings real clarity to a relatively murky area of history.  The book also contains detailed appendices estimating early emerald at Muzo, relative values of emerald and diamond in Europe in the 17th Century and  an extensive bibliography.  The author has uncovered several original accounts that have until now been unrecognized.    Highly recommended.

Investing in Gemstones, Part II; A Strategy:

Avoiding the Con:

There were a number of phony gemstone investment schemes in operation during the hard asset investment craze of the late 1970s and early 1980s. Until Congress put a stop to it, investors were purchasing, gems, antiques and Shaker rocking chairs as part of their IRA portfolios.

To avoid prosecution many gem investment scammers set up boiler room operations in Canada, but sold mostly to gullible U. S. investors. The pitch was simple and ingenious. To keep buyers from seeking an outside appraisal, the gems arrived in sealed packets with a microfilmed “certificate of authenticity”. Buyers were warned that breaking the seal would invalidate the certificate and negate affect potential resale.

Over the years, several victims have sought me out to appraise their purchases. In all cases, the gems were wildly overpriced stones and of a quality best described as Continue reading

Investing In Gemstones, Part I: The Market

Richard W. Wise, G.G.
© 2009


Bye, Bye Bling:

Perhaps it’s the tenor of the times. Increasingly I find myself fielding questions about gems as an investment. With government printing presses working 24/7, many people are concerned that deficit spending, coupled with Government stimulation of the credit markets in the U. S., Europe, China and Japan, will eventually lead to hyperinflation. With stocks, bonds and real estate in the tank and currencies at risk, people are thrashing about looking to find a safe financial haven. In uncertain times, investors turn increasingly to hard assets. Luxury per se is out, but investment is definitely in. (pictured above left a 1.01 vivid pink diamond from the 2008 Argyle tender)

The Problem:

Stocks and bonds trade in an orderly market. One share of General Electric common stock is just like another. Stock Exchanges guarantee that their members can trade stocks at the going price anytime the exchange is open. This gives stocks the advantage of liquidity. Stocks and bonds trade at established prices and these prices are Continue reading