Chuck:
To turn the diamond resource around will require a strong bull market, increased inflation, and a large dose of retail demand. The retail demand is unlikely.
The only reason I would buy investment quality diamonds at this juncture, and in this corroded world economy, would be to move my assets surreptitiously beyond lines of restriction. Smuggling is so simple vis a vis gold and other less legit items.
Other than physically concealing assets, I would not recommend venture capital in this arena. I do not share the supply-demand enthusiasm of some others. Just ask yourself, if those guys with the hairy chests, open shirts, and gold-plated chains appreciate or can tell, without a jeweler, the difference between a gem-quality diamond and a piece of broken bottle glass?
Let me pop the ABZ, MPV, etc., question back to your side of the net. Do any of the corporations you list have special situations going for them? If so, let me know your thoughts and I'll take a look. As a general comment, I would only consider a listed stock on a non-Canadian exchange with good daily volume -- such as De Beers but short term only. The strength of De Beers lies within a efficient marketing and distribution network that is afloat and functioning.
Your opinion on diamonds is appreciated. I argue only as the devil's advocate to help my decision process.
Ciao, Ted |
