Thoughts from the Rapaport Conference

I can only speak to Gerald Celente"s conference remarks as they are presented here in Rob Bate's column. I find Mr. Celent's quotes of a depression ahead and a 9/11 environment, unsupportable by any but the most tortured analysis. The global outlook just does not support the case for a an economic depression. Even the ongoing forthcoming recession forecast by prominent wire house economists a year ago is yet to materialize. Calls of a coming Great Depression do one thing measurably well - make headlines for the analyst. Much less promotional is to say the economy will continue to recover the rest of 2008 after a brief contraction at the end of '07, but it is growing only at a rate of about 2 percent. Most companies are flush with cash; globally economies are in reasonable health; consumer spending is rotating but continuing to grow in real terms; and whatever the inflation picture, the Fed will not raise rates again until there is major improvement in bank balance sheets. A concern everyone can have though is that should forecasts of gloom and doom spread, economic expectations become detached from the economy. Equity investors, unlike producers, are extremely sensitive to anxiety and pain in the ailing, media frenzied financial sector, and that's why stock prices, for example, are detached from the economy. In a similar way, consumer confidence is detached in the short run from consumer spending. Consumers are under stress as a result of large increases in food and energy, for which their demand is inelastic, but they are able to finance costlier food and energy by cutting back on discretionary items (although you'd never know this by looking at Tiffany's soaring profits the past two quarters and the equally promising quarter ahead). Writing in The Wall Street Journal in July, David Ranson, president of economic forecasting firm Wainwright Economics (full disclosure, I work for Dave) pointed out that the economy is not a "house of cards," but is more like a beehive. "The future of the hive does not depend on full employment for all the worker bees," he wrote. "In fact, an accident can put many bees out of action without compromising the hive as a whole." To be sure troubled major banks such as Lehman, A.I.G, Washington Mutual suggest deep cracks in the economy, and albeit they, as providers of credit are a critical part of economic activity, they are not the whole behive. Perspective is needed to put forecasts of an economic 9/11 behind. Writing in Forbes, Ken Fisher offers excellent perspective: "People see Fannie Mae's problems as huge, but in money terms the worst imaginable fix is smaller than the Anheuser-Bush takeover." The economy may well continue flat or close to it well into '09, and there will continue to be hard hit sectors, but as the results of the credit excess work their way through the broader economy, the bullish horns of a strong underlying worldwide economy will be revealed, and revived growth will emerge. Mr. Celente has a right to forecast all he wants, as does anyone. There will be no depression. Those who humker down to weather his coming storm will lose out to those who prepair and possition for the recovery.

The conference re-enforced how important it will be for all sundry to get together (miners, processors, jewelry manufacturers and retailers) to keep the message of diamonds relevant to the consumer without whose participation and ownership in our product will make us all redundant. And on a positive note.. Mr. Goldberg’s comments were the most heartening. He does get the essence of the malaise as well as the opportunity that is still there in our trade. And on the “Sky is falling” kind of message by Mr. Celente.. the lesson that I learnt that we need to establish a minimum IQ threshold for all running for political office… and for us to exercise our franchise in local and national politics. There needs to accountability starting first with me as an individual.

Destino is on record saying “ we recognize that there may be an undesirable appearance of impropriety which we must avoid ” in regard to past donations given by diamantaires. Now which part of this has anything to do with globalization or branding?
NAME THE GIA BRIBERS !
"Many in our industry are also speculating that the there are thousands of stones whose [ GIA ] grades are suspect." : Thomas Moses addressing the World Federation of Diamond Bourses in Mumbai, India 13th November 2005
ahhhh yes the " GIA brand " where diamond vendors can hide behind inaccurately graded and questionable diamond grading reports with confidence until someone comes along and sues the pants of you because the GIA brand does NOT guarantee their grades.
Good one Destino ! You de man !
" Our actions , whether individually or collectively, leave an imprint on our brand " Destino says in The Loupe Summer 2008
NAME THE GIA BRIBERS !
And finally...
Destino says all of us from students, alumni, staff to governors " is a caretaker of the brand "
Destino requests that we should " all pledge to be ambassadors of the [GIA] brand , fully committed to preserve and enhance what has to be enviably created by those who have gone before".
Most of have been doing this. Maybe it's time the GIA Board of Governors with Ralph Destino at the helm practise what they preach.
WHAT A PACK OF BLOODY HYPOCRITES NAME THE GIA BRIBERS !
GIA graded diamonds should be considered suspect as potential GIA bribery diamonds until the names of those actual bribers are disclosed. The GIA brand is a liability not an asset. Where is the Jewelers Vigilance Committee ? Isn't it a conflict of interest when you have four GIA Board of Governors also directors on the JVC one of which is Chairman Destino ? It's like the fox guarding the hen house. How much longer are you guys in the USA going to continue wondering where that burning feeling of rubber latex is coming from while you all remain silent and submissive? NAME THE GIA BRIBERS ! THAT'S ALL FOLKS ! HAVE A GOOD WEEKEND

all sounds interesting...glad the attendence was solid...great Zales commercial, but interesting that it's for Journey after the comments Goldberg made...