Summary
Market trends Diamond Industry in Flux Consumer Fears
Analysis
I would not want to bet on the fact that Blue Nile will post a substantial profit this coming season. Even with their being in European countries will not help, considering the economy of the world right now. Also factor in the fact that currently there is fear of diamond prices coming DOWN and NOT going up will only add to this problem. Consider that this year alone there has been a loss of over 800 retail stores due to bankruptcy. De Beers no long is the dominant player in the diamond market and now has retail stores and is opening additional stores to regain loss market share. African countries now control most of the diamond mines in Africa, which is the main source for De Beers. Moreover, the countries of Canada, Russia and Australia with their diamond mining operations have created an upheaval in the jewelry industry. This has never happened before, because De Beers was a monopoly in the diamond business, but this is no longer the case. I think that diamond prices will fall and that the jewelry industry will have to reorganize itself in order to prevent worldwide diamond price swings.Jules Rabalais
