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Market Analysis for 2009

Jan 5, 2009 7:41 PM   By Martin Rapaport
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TO LATE FOR COMMENT
Feb 17, 2009 7:50AM    By diamond jewlery united
Congratulation on your comment ,diamond are girls best friends ,as long as prices are abordable ,the price increase craze that was accepted by everybody in the past 25 years did not seem to bother anyone as they say THE MORE THE MERRIER but here it comes The Credit Crunch .... and diamonds becames bottom list of priority ,WHY ? because the prices were out of reach .People get REAL .... A DIAMOND SHOULD BE FOR EVERYONE ?and not to intertrade between Diamantairs .People want still to buy diamond jewlery the problem is WE HAVE TAKEN IT OUT OF THEIR REACH diamond is not an investement its a luxury item we take it out of reach we create a crisis.I was i diamond dealer for 35 years and 5 years ago i decided to get out of this crazy dream and got to creat jewelery affordable it is not easy but i realised that there are no easy business .Stop blaming others but yourself get of your high horse and do some creativ busines and G-D will help.
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Martin's New Year Message
Feb 8, 2009 12:34PM    By Tony
Of course, the real solution to any problem in the diamond - perceived or other wise - is to remove the price fixing arrangements that are supported by the Rap List. A return to a completely free market would harmonise both demand and supply. Agreed, at this point in the economic cycle, that equilibrium would be stabilised at a temporary low level, but in furture harmonisatrion would return to a higher equilibrium as supplies cut back on production at a time when demand was rising again.
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Congrats Mr Rap!!!
Jan 30, 2009 2:32PM    By MD
Happy New Year To you & the family, I am glad that you are still on top of things, and taking care of business. I myself miss the industry, but when I do decide to get my diamond I will call Dayna for services,,

Peace & Blessings
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Market Analysis
Jan 30, 2009 4:33AM    By Shrenik
give an option to download video as too crumbersome to watch when internet connection is slow
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Jan 23, 2009 7:03PM
hi martin your idea is good but how to work out whole industy. basis selling and buying cash. think about that. think about twenty year s ago in far east, buy diamond need pay cash, but in amercia, they use credit to trade the diamond business, then t he world trade diamond use creit method, now how to change.h i martin, the human being they dont how to work together one world one dream. best rgds mr yokeebee
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Don't get it
Jan 23, 2009 8:31AM    By JM
Why are so many that are reviewing this information completely not getting it? Numerous comments are blaming Martin for setting prices too high and then again placing blame on him for lowering prices...Rappaport does not set prices, they REPORT prices. This blame is idiotic and is akin to blaming a news anchor for the results of a terrorist action! Martin is correct in his statement that diamonds are a commodity. They are only worth what someone will pay for them. In business as in your personal life, if you can't afford to buy something then don't buy it...it is time to make the hard decisions and stop living on credit. Cash sales would bring stability to the entire supply chain. Kudos Martin.
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Arm chair generals in the diamond business
Jan 23, 2009 2:24AM    By syddalljewelry.com
I think that it is easy for you to make comments and talk like a big dealer....u are NOT.... just like a gemologist...u only only know how to talk ... u just sit in your chair and talk about it. ....so let the REAL dealers have a say ....and if the Diamond prices are so unstable....nobody will ever dare to own a diamond ...unless it is cheaper then hamburgrs.

People buy diamonds also to keep as portable wealth. if u drop or de -stablize the prices then u are killing the market ....u have created.

Let the list prices be stable and if the dealers need money and want to sell some stock to clear their debts...then let them have their own say and discount whatever they want from the list....thats their problem .


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External factors
Jan 19, 2009 6:08AM    By Gregg
Dear Martin,
I quite agree with most of your position, the stimulus might come from 2 important external factors being :
When credit risk insurance will be dropped by insurers !
When bank credit will be between 15 to 20% per annum !
And that wont be for tommorrow.
A suivre,
Gregg

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What's with the bow tie?
Jan 17, 2009 11:33AM    By Ron Samuelson
Martin, you are a wise man. I agree that memo is out and cash is king. Buying from the public is the way as well. And I agree that branding should NOT be the job of the wholesaler, but the retailer. Branding yourself and your store through social media and web 2.0 is the way us young guys need to do it (and you too Mr Rap) It's great that you're doing web videos and you're on Facebook, but you need to learn how to use it to further the RAPPAPORT BRAND, which is what you have, like it or not.

So just one question, what's with the bow tie? I mean no disrespect, but it makes you look like a "k'nocker", as my grandfather would say. It's 2009, my friend, look like you're with the times ;)

Respectfully,
Ron Samuelson
http://www.RambleOnRon.com
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Stop Crying
Jan 15, 2009 1:10AM    By Ansary
Yes the raise of Rappaport price was bad mistake. Martin did not see the recession come for he was still living in a dream of enjoying hand clappings from Debeers and big diamond speculators. Yet greedy people will always get their own potion. We can always learn from our mistakes.
It's time to tighten our belt and take a deep breath. It's going to be long and to last at least 2 years, after that the wise will rise and shine.
Until then pray and hope for the best. May God have mercy and grace on us.
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Where do you see CASH??? & Mulltiple Issues!!
Jan 11, 2009 12:52PM    By Sam
Manufacturers will sell diamonds in CASH to wholesalers? Why will they buy them?? WHen you raised the prices so high & the economy in a downwad spiral.....& prices may crash again....why would one buy in CASH??

Other issue - What will happen to the small wholesalers - diamond dealers?? Have you considered how much unemployed will be caused with your notion of selling in cash??

Talking about added value - what added value you can ask more from middlemen? when manufacturers are going DIRECT to the end consumers??

BRANDING - this term is sooo overhyped & misused by manufacturers these days.....this infact, has killed the market by confusing the end consumer! million different cuts.....zillion different 'so called' branded collections??
example: ' hearts on fire' selling ideal cut stones for premium prices by fooling end consumers!! why should consumers pay high premiums??

High End Gadgets for LESS - this has been a biggest threat to dismal sales for last 1-2 years & will continue cause more damage to mid-range jewelry / diamonds sold at brick n mortar stores or mid-value retail chains.
example: Iphones - Blu Ray DVD players being sold for $200 or less ... High Def. Flat Screen TVS sold under $1500
- The 'perceived' value of diamons & diamond jewelry under approx $2500 has totally diminished!!

Any constructive criticism or suggestions are welcome.

God Bless!
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Wish you happy New Year & Congrats New office in India
Jan 10, 2009 4:55PM    By Abdul Q,Chicago
Hi Matin, Diamond is luxery Merchandise thos who have enough money buy the Diamond,if ur ideas come in Daimond Bussinees every one can buy the Daimonds, we can do more Bussiness,and u have good bussiness Ideas,
i apparicaite you, thank you.if u have any question conect me :absgemsjewels@gmail.com
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ABOUT MICHEAL NORTON COMMENT
Jan 10, 2009 7:43AM    By A DIAMOND DEALER
DARLING: DIAMONDS ARE NOT A COMMODITY & BECAUSE NO TWO DIAMONDS ARE THE SAME THEY NEVER WILL BE.

M.R. KEPT PRICES FIXED AND GOING UP FOR YEARS NOT BASED ON SUPPLY AND DEMAND.

THERE WAS NO NEED TO RAISE DIAMOND PRICES SO RAPIDLY IN 2007- 2008, PERIOD.

BUT, BECAUSE M.R. DID HE SHOULD HAVE AN OBLIGATION TO THOSE THAT BELIEVE AND SUPPORTED HIM, TO HELP FIX WHAT HE ALONE CAUSED.

YOUR OTHER POINTS MAKE NO SENSE IN RESPONSE TO MARTIN RAISING THE PRICES SO RAPIDLY AND THEN LOWERING RIGHT BEFORE XMAS. IT WAS NOT THE % THAT THEY WERE LOWERED ITS WHAT IT DID TO THE STABLITY OF DIAMOND MARKET.

HE COULD HAVE LET THE DIAMOND DEALERS, IN WHICH MANY WERE OVER CHARGEING ABOVE RAP%, START DISCOUNTING AS THEY WERE DOING, WHICH WAS STARTING TO BRING PRICES DOWN ANYWAYS.

THIS METHOD WOULD HAVE STILL LEFT PEOPLE WITH CONFIDENCE IN DIAMONDS WITHIN THE TRADE, AND THE PUBLIC.

THEN M.R. COULD HAVE ANNOUCED AFTER MONTHS OR YEARS OF SEEING DIAMOND DEALERS DISCOUNTING HEAVLY, HE DECIDED TO BRING PRICES DOWN TO REFLECT THE SETTLED MARKET PRICES.

BY YOUR COMMENTS I WOULD ASSUME THAT YOU DO NOT OWN ANY LARGE DIAMONDS AND DO NOT SEE THE DAMAGE DONE BY RAISING PRICES SO FAST AND THAN LOWERING THEM.

HUMAN KIND WILL ALWAYS NEED A PLACE TO STORE THEIR WEALTH AND YOUR COMMENTS DO NOT REFELECT DIAMOND DEALEARS WHO BORROW MONEY AND TAKE THE RISK TO OWN DIAMONDS AND SELL DIAMONDS. WE EXPECT THE RAP PRICES TO HAVE SOME STABILITY AND LET INDIVIDIAL DIAMOND DEALERS DISCOUNT AS THE MARKET DICTATES.

GOOD DAY.
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rule out economics for diamonds
Jan 10, 2009 1:28AM    By keyur
economics do hold good for the principle of demand and supply;but to the extent of its worth applicability.

rising demands for diamonds caused you to rise the price list,but did you noticed the other side where supply was never affected;it was duly met.so here was no need of price rise...

it may hold truth in thinking all this just when the situation is reverted and we are i crunch.

but thats not only the truth,its the havoc in both side,for the customers and the diamondtares.

customers turnrd to diamonds as the safe heaven for investement.

but the present scenario just got them to wake where their investements like stocks get under speculation..

this is just getting customers away from ur side..

the only way to restore the confidence and to get out of panic situation is to get customers and traders their worth bak .which is the only thing that cangetb the situation back on track...

so mr.martin.....
it has to go along way...
its either being on your rap list or soul list...

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Congratulation New Office In India and Happy New Year 2009
Jan 9, 2009 3:55PM    By Abdul Q,Chicago
Hi Martin,Diamonds is Luxery Merchadise, people thos who have enough money buy Daimonds,if we come with MR Martin's Ideas do the bussiness every can afford the Daimonds,and we can do the more bussiness more people buy the Daimond,Really i appricaite Mr Martin statement,
if u want to contect me Email:abqadeer@gmail.com
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New Years analysis
Jan 9, 2009 12:53PM    By Joshua Bar-Horin
I agree with most of what you said , the only shame is that this speach was due last year , it would have be much more productive !
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2009 is the year to get real
Jan 9, 2009 3:10AM    By Michael Norton
The problem is that diamond people are drinking the Cool-Aid and believe their own marketing. Diamonds are NOT unique , except in the cases of the few unique colors or sizes. For the the few and lucky out there that sell the 20 carat diamond or the vivid fancy pinks, nothing said here affects them. For the rest of us, 99.999% of diamonds sold are a commodity. Pork bellies, Crude oil, gold, cotton and diamonds. Get over it and get used to it. The retail public has a LONG time ago. Why does BLUE Nile , Ebay and Wal-Mart dominate the diamond world , if you want to admit it or NOT ??? Because Joe P Public want a diamond and wants the best price for it, like his gasoline, another commodity .
You then say I am a specialist or something similar. Well so were butchers and bakers and your local supermarket wiped them out years ago.



Decades of artificial scarcity by the syndicate has affected our industry as a whole. Get off of your EGO if you think otherwise. As a commodity the prices will go up and down. All the people who loved the prices going up are now blaming Rapaport and Debeers and anyone else they can think of for the current crisis. Maybe OPEC should blame Martin also for the crash of oil prices, or Texas oil people should scream because Wall Street let the price of oil go up too fast.

Just like the housing bubble, prices can not go up forever . In addition if the prices go up fast, the come down just as fast. All this is basic economics for anyone who took it in college.

.Here is the choice you have for the year of 2009, become REAL or become a STATISTIC . With the current state of the industry and this just being the beginning , if you don't get SMART you will become like the butcher or baker an interesting bit of history .
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what does he know?!
Jan 8, 2009 11:34PM    By a real diamond dealer
dear mr rapaport
are you a diamond dealer?
what have you done to actually look into what is the cause of the drop in confidence in diamonds?
you created it!!!
it was so fake and looked bad to consumers,the way you raised prices every week!
trading would stop every week prior to the publishing of the new list!
even as the financial market crashed,consumers looked for a safe investment and found it in diamonds.
that was until you dropped the prices!
diamonds are only worth what people will pay for them.
they are as worthless as glass if people don't think they are worth it!
i think money is way better then diamonds!
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diamonds for cash
Jan 8, 2009 5:45PM    By haim aharonoff
hi
it is good idea but it is a long process with alot of adjastment withinthe indastry way of thinking and the price
that we will have to pay for it is not in anybodys hand.
keep up your good words power and act for better time.
thank you
haim
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stop thinking start acting before its late
Jan 8, 2009 12:08AM    By ashish
everybody is awair of whats going on but now is a time to think together and take few steps to control our industry.
DTC can control diamonds.DTc should stop selling diamonds for about 5 to six months.DTC should stop mining .Freez the goods. I am sure it will be very efficative.
At the same time rapaport should not go down because the diamond the prices will automaticly adjust. The discount will automaticly increase .The confedince of the customer will also increase.
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Bernie M. is watching you
Jan 7, 2009 8:25PM    By Bernie
Martin: Please admit you caused most of the problems in the diamond market. If you would have raised prices like 1% per month max.

We would never have the mess you left behind.. You shattered the confidence of almost all diamond dealers and many consumers world wide.. Most people are not sure what to make of you.. ARE YOU A MAD MAN or did you have a plan with what you did in 2008?
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Way Off
Jan 7, 2009 12:47AM    By Garry Holloway
Hi Martin, Happy New Year to you, yours and everyone. Trouble is for a lot of people it will not be their best ever year. Especially if they follow your advice and treat diamonds like money. Selling money and making a sustainable business out of it is real hard. But creating a unique and sustainable financial service (not CDO's) is a good business.

Troubles in our industry have to happen - I support you on that and you should represent falls in prices based on what is really happening out there.

But what can we do to avoid it in the future - treating diamonds like money or a commodity is not the answer. Building sustainable brands with real client loyalty and trust are. We are a long way from that right now. Would any of you buy a diamond for a loved one of family based only on the info on the cert? Of course you would'nt - but we use them for customer confidence - what a joke!

I do not know if you saw Sergey Sivovlenko's presentation in Surat last week Martin? He had projector issues and it might not have come across well - but he is a visonary who is paving a road out of the mess our generation has created by commoditizing diamonds. If anyone wants to learn more I am not hard to find.

Now is the time for those with the capacity to create a new division in their businesses and work to a more profitable and sustainable business based on whatever differentiation you can innovate. If you can't do that, then just keep flipping hamburgers or drive taxis.

Regards
Garry Holloway
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Martin's New Year message
Jan 6, 2009 4:12PM    By concerned diamantaire
Congratulations to Martin for his fine analysis of the present disruption of the flow of diamonds and his understanding of the likely liquidity problems ahead. However, when he starts saying " where do we go from here" he is completely besides the point. Downstream and value-added activities have nothing to do with cash sales. The idea that diamonds have to return to cash sales is utopic. Why should I not grant credit to my customers? Would I prefer for them to go elsewhere where they can obtain that credit? And what is a fair market price? Rapaport prices at 25, 35 or 50 back?.
I fear that behind this schmooze lies Martin's new brilliant idea to centralize at Rapaport all certified diamond transactions that would only done for cash. This is likely to succeed like his auctions or his idea of commoditization which were both major flops.
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