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Industry News: $900 Gold Possible; New Investment Diamonds; Magic Johnson at AGS; New Movie At GIA September 17, 2013 (0 comments)
Could $900 Gold Be In The Near Future?
New York, NY—Once again, both investors and jewelers are wondering, how low will gold go?
The metal last week dropped 5.4%, the sharpest decline since June, and it’s on track to have the first annual loss in 13 years. Some analysts, such as Jeffrey Currie, head of Bloomberg’s commodities research, believe gold could drop below $1,000 the ounce in the not-too-distant future. The drop, which would be largely driven by both an improved economy and withdrawal of Fed stimulus funds, would mark the first time since 2009 that the metal traded below $1,000.
But gold rallied Monday morning on the news that former Treasury secretary Larry Summers has withdrawn his name from consideration to be the next Fed chairman when Ben Bernanke steps down next year. Analysts believe the number-two candidate, Janet Yellen (currently the Fed’s vice chair), is likely to tighten Fed policy less than Summers would have. And at press time, gold had rallied to a close of $1,360 on the news that the Fed will not scale back quantitative easing just yet.
Even if events do conspire to drive gold down below $1,000 in the short term, Currie still sees gold stabilizing around the $1,200 mark in the longer term, mainly because of production costs. Below that level, he said, it’s likely that many producers would have to shutter operations.
Separately, Thomson Reuters last week issued its Gold Survey 2013-Update 1. According to the report, gold jewelry fabrication reached the highest levels in six years, with consumers in a number of countries, including the United States, moving to higher karatage gold jewelry. This is the first time this has happened in more than a decade in the United States. There also has been a shift away from alternative materials and back towards gold, says the report.
But Thomson Reuters also maintains a bullish view on price, believing that both ongoing political wrangling in Washington and geopolitical tensions in general will reverse the bearish price trends of 2013 and that it’s even possible to see $1500 in 2014, before settling back to an ongoing average around $1,350.
Gemshares And NASDAQ OMX Partner To Create Investment Diamond Basket Index
Chicago, Il—GemShares LLC and The NASDAQ OMX Group Inc. have announced an agreement to develop the GemShares Global Investment Grade Standard (GIGS) Diamond Basket Index.
A trademarked, transparent, rules-based index, GIGS will provide a standardized pricing mechanism for valuing a diamond basket that could be used for the development of financial products.
The two organizations will develop the index to track the prices of diamonds that have met the patented standards for investment-grade certification developed by GemShares. GemShares was founded in 2007 with the goal of creating a fungible global investment standard for diamonds and gemstones. It was awarded a patent for the GIGS pricing mechanism in August 2012.
Through this index, diamonds that have met the GIGS gemological, proportional, optical, and light-behavior guidelines can be securitized for the creation of financial products to be listed and traded on regulated exchanges globally, says a GemShares spokesperson.
Industry opinion on diamond investment remains divided. Richard Platt, a director at UK-based PolishedPrices.com says there is room for a diamond-backed investment fund—with the caveat that it is [government] regulated. The industry could benefit from the investment dollars of a diamond fund, as long as it gets full regulatory approval, with independent and transparent pricing, and clear disclosure of what the transaction costs are, he said in an earlier interview with The Centurion.
But experts such as consultant Ben Janowski believe that although most manufacturers can cut to Ideal or near-Ideal proportions and get GIA certificates, diamonds still are not fungible enough to fit the commodity model like gold or platinum. And GIA’s senior industry analyst Russell Shor says that while diamonds do hold their value against other luxury goods like handbags and shoes, the stones that offer significant return on investment are the extremely rare mega-stones or intense fancy colors, not basic one-carats.
GIA Hosts Jewelry Film Premiere of Masters of Dreams
Carlsbad, CA—The west coast premiere of the jewelry documentary Masters of Dreams was held at GIA’s world headquarters last night.
Masters of Dreams, created by French Connection Films and Quasar Multimedia, is a four-part documentary series that goes behind the scenes with 13 of the world's most legendary jewelry houses: Boucheron, Buccellati, Bulgari, Chaumet, Chopard, Damiani, De Beers Jewellery, Forevermark, Graff Diamonds, H. Stern, John Hardy, Stephen Webster, and Verdura.
From Paris to New York, London to Bali, and Milan to Rio, the series offers a breathtaking journey into the world of fine jewelry, filled with famous families, gemstone hunters, and some of the world’s most innovative designers.
The event featured a special reception among the GIA Museum’s jewelry collections, a screening of the "Italian Jewellers" segment of the film, and a Q&A session with the filmmaker and luxury jewelry house executives. Filmmaker Ken McGrath, a GIA graduate, and Alberto Milani, CEO of the Americas for jewelry house Buccellati and Guy Bedarida, creative director and head designer for jewelry house John Hardy, led a lively panel discussion following the premiere.
Magic Johnson To Keynote AGS 2014 Conclave
Las Vegas, NV--The American Gem Society has announced that NBA champion Magic Johnson will be the lead keynote speaker at its 2014 Conclave, set for April 23-26 at the historic Hotel Del Coronado in San Diego, CA.
From his outstanding NBA career to his current title as CEO of Magic Johnson Enterprises (MJE), Earvin “Magic” Johnson knows a thing or two about winning. He will address leadership and teamwork as well as his passion for business and philanthropy in his keynote, “The Magic of Winning,” at the opening session on April 23.
“A legendary event in the jewelry industry deserves a legend for a keynote,” says John Carter, chair of the Society’s Conclave sub-committee. “Who better than Magic Johnson? We are excited and honored to have him present at Conclave.”
The 2014 Conclave also marks the 80th anniversary of the American Gem Society. “Conclave’s theme in 2014 is ‘Be Different. Be Distinctive. Be Here,’” said Carter. “With Magic Johnson getting the show started, this Conclave will be like no other.”
AGS will announce the rest of its keynote and featured speaker lineup in upcoming weeks. For more information call (866) 805-6500 or email ashah@ags.org.