There is a popular new video circulating the internet called, “Why Engagement Rings are a Scam”. This entry looks into the validity of the video’s claims.
Da Beers is not the monopoly it once was. Its stranglehold on the diamond industry has diminished as a result of the creation and growth of diamond mines in Canada, Australia and Russia. Currently, their market share stands at less than 50% Source. Not exactly the all controlling monopoly which the video makes them out to be.
Engagement rings can be traced back to Ancient Rome. However, those rings were plain metal, and didn’t contain any diamonds. It is only in the 20th century, as diamond production increased, that diamond engagement rings became popular. The De Beers marketing campaign was launched after WW1 to reignite the diamond market during what was a serious economic depression. The success of this campaign is credited with turning diamond engagement rings into a nearly universally accepted symbol of commitment. So, while engagement rings were most definitely not a De Beers invention, their marketing efforts are the main reason that diamond engagement rings are popular today.
Verdict: Mostly True
The narrator starts this claim by saying that diamonds are “intrinsically” worthless. He backs this up by stating that, because the supply is controlled to influence price, they have no real value. While this is partially true, (Supply is controlled), through this reasoning, money itself is worthless. Diamonds have numerous technological and industrial applications due their hardness and conductive properties, meaning they actually do have “intrinsic value”, even though this value may not be accurately reflected by their retail price.
The next point the narrator makes, (At the 2:44 mark), is completely false. To quote, he says that diamonds have, “…Virtually no resale value”. This is completely untrue. Our company purchases used diamonds from clients on a daily basis. In reality, diamonds often fetch anywhere from 40-70% of the purchase price in the resale market, a figure much higher than most other luxury items. To say that diamonds have no resale value is either a huge oversight, or outright lie. This doesn’t even account for the historical rise in diamond prices, which can result in a person making a profit on a diamond purchased 20 or more years ago.