I'm planning on proposing to my boyfriend, uh, shortly.
The weeks leading up to that are, like, the most stressful,
nerve-wracking.
You know when you get to the point that you, like--
all you can hear is, like, badum, badum, badum.
He got down on one knee, and pulled this box out of his pocket,
-which I had no idea was there. -[both laugh]
And he's like, "Well, I wanna be with you forever."
And everything went black and disappeared,
and I was in this space with him, and my knees were weak.
[Cleo Abram] You probably know what they bought.
Diamonds are the world's most popular gemstone.
But if you compare them to other jewels, it's not obvious why.
These are just as sparkly as a diamond.
These look indistinguishable from diamonds.
One of these is a man-made diamond.
Scientists can now create diamonds in a lab
that are structurally identical to diamonds mined from the earth.
And yet, every year,
people spend their savings to buy the real thing.
It is the single most expensive thing that either one of us has purchased.
It was the most beautiful and most significant thing ever to me.
Somebody that can afford to give you nice diamond, no? It's nice.
So what exactly makes these rocks so special?
What is the value of a diamond?
[woman] Diamonds, forged by nature and crafted by man.
[man] It may be a cliché to say that this is "rich soil,"
but this time, it's literally true.
It's beautiful. And he designed it.
Make sure it stays on that finger.
Of course.
[man] It's not a purchase that's logical. It's supposed to be illogical.
It's not rational.
[woman] They just seem representative of these terrible things.
It's like this waste of money,
and we're only doing it to show other people.
[man] What do people want? How much do they want it?
What are they willing to pay for it?
[Abram] We all live on a thin, solid crust
above hot molten metal soup.
That crust is typically less than 40 kilometers deep,
just twice the length of Manhattan.
Rubies, sapphires, emeralds-- these all form there.
But a diamond's home is deeper.
Scientists measure pressure in pascals,
and where diamonds form, pressures are five to six gigapascals.
If you think of 80 elephants standing on your big toe,
that is the pressure that is equivalent to five to six gigapascals.
Every other precious gem is made up of combinations of elements.
A diamond? Only one. Carbon.
From a scientific perspective,
the most important part of a diamond is this.
[Smit] These are small pieces of the mantle
that's been trapped during diamond growth,
and so these inclusions are actually the only direct samples
that scientists have to study the deep earth.
[Abram] And those inclusions can be dated.
If this is all of human history, and this is the time of the dinosaurs,
this is the period when all the diamonds we see today were born.
The oldest diamonds that have been dated actually predate life on Earth.
Over 25 million years ago,
diamonds blasted to the surface in rare and violent explosions.
In the most seismically active regions, they just evaporated.
In the more stable areas, they survived.
This is a map of seismic waves through the Earth.
The most stable areas are the pink ones.
And that's where diamonds lay unnoticed for millions of years.
The earliest piece of surviving diamond jewelry
is this ring made around 300 B.C.
Over the next 2,000 years,
diamonds popped up in crowns, rings, and pins
alongside other precious gems.
And sometimes they were wedding gifts,
like the diamond ring exchanged in the betrothal
of Archduke Maximilian of Austria and Mary of Burgundy.
But diamonds wouldn't become the unrivaled gemstone of love
until these diamond deposits were discovered in South Africa
400 years later.
Enter Cecil Rhodes, a British 17-year-old sent to South Africa,
then Cape Colony.
He would one day be remembered as a colonizer of Rhodesia,
now Zimbabwe and Zambia, the namesake of Rhodes University,
the creator of the Rhodes Scholarship,
a zealous imperialist,
and the founder of the company that would dominate the diamond industry
for more than a century--De Beers.
Under its watch, diamonds transformed from a gem like any other
into a cultural touchstone.
To understand how they pulled that off, you have to learn the De Beers' playbook.
The first play--control supply.
In the 1870s, Rhodes started buying up his competitors.
I think it's important to understand
De Beers didn't necessarily produce all of the diamonds in the world.
They produced a lot of the diamonds. They bought supply from other producers,
and this allowed them to basically control supply.
Around 90% of the world's supply within two decades.
Then came the second play.
Rhodes made a deal to sell his entire supply of diamonds
to an exclusive diamond syndicate in London.
When De Beers had control of global supply under the monopoly,
they had a strategic stockpile.
And in situations where, um, you know, demand would decline,
they would hold back supply to market as they saw fit.
De Beers never released information about its stockpile
and claims they no longer have one.
But in 1999, The New York Times pegged it at 5.2 billion.
In the 1940s, the U.S. government tried to build its own diamond stockpile,
because diamonds aren't just for jewelry.
They're also the hardest-known natural material on Earth,
which makes them crucial
for manufacturing weapons, tanks, and airplanes.
And while ultimately, the War Production Board
said no piece of equipment was delayed,
a government official claimed the De Beers-led syndicate
was making getting diamonds so difficult
that the U.S. had to threaten to "not give planes to England
if the syndicate did not sell us the diamonds to make them."
The reason? "The diamond syndicate will not sell us a stockpile
because it will not tolerate large stocks outside its monopoly control."
But maintaining the price of something isn't just about supply.
It's also about demand.
The decade before World War II, De Beers was in crisis.
It was the Great Depression,
and there weren't many people shopping for diamonds.
Worse, people might sell the diamonds they had bought,
increasing the supply and further driving down the price.
So De Beers has hired an advertising firm which came up with a brilliant idea.
What if people kept diamonds... forever?
Certainly the famous slogan "A diamond is forever."
It's probably one of the most successful advertising campaigns
in advertising history.
Rings had been a common engagement gift since the early Middle Ages,
but the idea that a diamond should be on that ring? That was new.
The first campaign ran in the U.S.
with paintings by some of the world's biggest artists.
On the right, that's by Salvador Dali.
On the left, Pablo Picasso.
The message was, "Diamonds are works of art."
Many campaigns followed, all with that same slogan.
[man] A diamond anniversary band.
On your tenth, show her you'd marry her all over again.
[Abram] It worked.
In the 1939 classic, Gone With The Wind,
Scarlett O'Hara pleads for this precious gem.
What kind of ring would you like, my darling?
Oh, a diamond ring. And do buy a great big one, Rhett.
But she'd have been one of only 10% of American brides
who received a diamond ring that year.
By the 1950s...
♪ But square-cut or pear-shaped ♪
♪ These rocks don't lose their shape ♪
...diamonds were a girl's best friend.
And by 1990, 80% of American brides got one.
And if a diamond is forever, most people don't want a used one.
There's no official price scale for second-hand diamonds, but...
I think you would be stunned
by how little you would get
as-as a percent of what you paid.
You might get 25% of your purchase price, 30%.
The campaign was such a hit, De Beers ran it again.
This time in Japan.
-[man speaks Japanese] -[speaks Japanese]
[man speaks Japanese]
In 1967, when that campaign began,
almost no Japanese brides received a diamond.
Twenty years later, over 70% of them did.
In the 1990s, De Beers turned to China. Same slogan...
[man speaking Chinese]
-[Abram] Same result. -[man] De Beers.
These ads are trying to create demand, and that's not some dirty trick.
That's capitalism.
I can convince you that you actually want to buy a pet rock,
which, to me, was, like, the dumbest idea in the world,
but people were able to be convinced you should value this pet rock.
That's why ad companies get paid what they get paid.
De Beers was just remarkably good at this.
But not all De Beers' efforts have been successful.
In the 1980s, De Beers tried to get women to buy diamonds for men.
That one didn't stick. De Beers tried again to get women to buy diamonds
in a 2003 campaign called, "Raise Your Right Hand,"
with the idea being that an empowered woman
would have an engagement ring on her left hand
and a diamond ring she bought herself on her right.
That one didn't take off, either.
Diamonds may be worn by women,
but the primary consumers of diamonds are men.
For a few years, De Beers commissioned surveys.
One question asked if you'd want a diamond ring
if it meant forgoing other things.
In 1990, only 22% of women said yes,
but for men, it was 59%.
Many men reported that buying a diamond engagement ring
was a mark of adulthood.
I think it is, in some ways, a symbol that I've arrived,
and I'm able to make such a significant purchase
and kind of take this step.
This set the stage for De Beers' next play--
linking the amount a man spent on a diamond
to his professional success.
It's become a cultural norm in the United States.
The rule of thumb--diamonds should be about two months' salary.
-Two months' salary. -Two months' salary.
De Beers came up with that. In Japan, they came up with three months.
That link between diamonds and a man's professional success
grew in a way that De Beers may not have anticipated.
And rappers started name-dropping their favorite jeweler.
♪ You are the Jacob ♪
-♪ Jacob ♪ -♪ Jacob ♪
♪ Jacob the Jeweler ♪
My nickname is Jacob the Jeweler.
♪ All these diamonds on my wrists ♪
How much value we have here? I would say, um...
about 35 million.
I have put diamonds on almost everything.
I think I once made a toothbrush in diamonds and gold.
It's a sign of success. Like you would say, "Honey, I love you.
And this is how much I love you. This is how big I love you."
This is a 75-carat, uh... vivid yellow.
Carat, color. What he's talking about was another play.
Number five--define value.
If you walk into any diamond store today, they'll probably tell you about the 4Cs.
The 4Cs are the four most important characteristics of a diamond.
They represent cut, color, clarity and carat weight,
which is the size of your diamond.
A diamond should be cut not too flat, not too deep.
It should be either colorless or a bright color, but not in between.
It should be clear, free of the inclusions that scientists love.
And it should be big.
That system for grading diamonds was invented in the 1940s
by a gem research institute.
They started selling certificates.
I think that everybody feels very assured when they get some kind of certificate
and some kind of, um, understanding of-of where their diamond lands,
in terms of the grading system.
De Beers promoted the 4C system, helping it take off.
Conveniently, a lot of their diamonds were big and clear.
And demand for them kept going up.
But in countries where diamonds are mined,
that demand sometimes meant funding for conflict.
Between 1992 and 1998,
a rebel group in Angola
raised more than $3.7 billion from diamond sales,
fueling a war that killed at least half a million Angolans.
Diamond sales also helped fund conflicts in Sierra Leone,
the Ivory Coast, and Liberia.
Eventually, this drew international attention and backlash.
-Blood diamonds. -Blood diamonds.
-So-called "blood diamonds."
But in the U.S., the demand for diamonds remained pretty much the same.
And while there is now a certification system
to try to stop the sale of diamonds smuggled from conflict zones,
no one knows for sure how well it's worked,
because the diamond supply chain is incredibly opaque.
I think it's difficult if you don't have any paperwork with the diamond
to really fully understand where it came from.
But around the same time that blood diamonds were making headlines,
De Beers and its playbook faced its biggest threat yet--real competition.
I think most people think that all diamonds come from Africa,
but it's actually important to understand
Russia's the largest supplier of diamonds in the world.
For decades, De Beers had an exclusive deal
to buy most of the Soviet Union's diamonds.
But when the Soviet Union collapsed, so did the deal.
Then, in 2005, De Beers settled an antitrust lawsuit
that had accused them of a conspiracy to fix the price of diamonds.
De Beers agreed to pay $295 million back to American consumers.
And in a separate case with the U.S. government,
De Beers plead guilty to price-fixing.
De Beers' market share began to go down.
But something strange happened. The price of diamonds didn't.
De Beers is no longer the biggest player,
but diamond companies still look to their playbook.
Alrosa is, uh, the largest producer of diamonds worldwide.
We have about a 27% market share,
which means that one out of every four diamonds
is an Alrosa diamond.
The top three producers--De Beers, um, Russia's Alrosa, and Rio Tinto--
none of them actually manage a strategic stockpile
the way that De Beers did during the monopoly era,
um, but they will, you know, withhold goods, uh, from the market
if they feel there isn't substantial demand.
[woman] How do you think about stockpiling diamonds,
and how does the industry make sure
that there aren't too many diamonds on the market
in such a way that would cause the price to go down?
Yeah. There's a-there's a party line
that I'm supposed to say about that, which, uh...
[both laugh]
Sometimes, of course, there's more supply than demand,
um, and, uh, certainly when that happens,
we don't look to reduce pricing
because we don't want to jeopardize the inherent value of the diamond
or what ultimately the consumer is going to be purchasing.
At this point, I can't really imagine
who is incentivized to have the price fall.
And that even includes consumers.
[Spriggs] If I offer you a bottle of red wine,
and I say one of them cost $75 and one of them cost $20,
if you know a lot about wine,
you may look at the labels, you may taste them,
and if you're really good, you may be able to tell me
this $25 bottle of wine is really the better wine.
Most people don't have that ability. They're gonna give me the $75.
That creates this perverse setting
in which if I raise the price, instead of the quantity demand falling,
I can actually see the quantity go up.
They're called Veblen goods,
and they're a unique good
in which the price itself is interpreted by people as a signal.
Other famous Veblen goods include Birkin bags,
Cristal champagne and lawyers.
I do think that there is an aspirational quality to diamonds,
where the price, the fact that it is expensive, adds desire.
Because it's-it's a sense of arriving, it's a sense of aspiration.
And it means that people will pay top dollar for them,
even if an option exists that's structurally identical.
The structure of a diamond is simple.
All carbon atoms, each one forming four bonds with its neighbors.
In graphite, also all carbon, atoms form three bonds.
And that tiny difference is why graphite is soft enough to be a pencil,
and why diamonds are so hard, they can only be cut by another diamond.
We actually first figured out how to make diamonds in a lab back in the 1950s.
I twiddled around a little bit and saw the sparkles.
My knees weakened. I had to sit down.
That's scientist Tracy Hall in an interview with the BBC
describing the moment he and his team
became the first to consistently and publicly create a diamond in 1954.
And at that instant, I knew that man
had finally turned graphite into diamond.
And today, we can pump gem-quality stones out of machines.
There are two completely separate ways to grow a diamond.
High-pressure, high-temperature diamond growth
is recreating the conditions in nature
with which carbon crystallizes into diamond.
Chemical vapor deposition is a methodology to grow diamonds
where hydrocarbon gases are injected into a growth chamber,
and microwave plasma energy
is used to break apart the bonds of that hydrocarbon,
allowing free carbon atoms to rain down on a plate of diamond,
and atom by atom, grow that diamond vertically,
resulting in extraordinarily high-purity, high-quality diamonds.
A diamond is a diamond, regardless of whether it's made in a lab
or whether it comes from the earth.
Take a guess. Which of these is lab-grown?
You definitely couldn't tell.
It takes very specialized laboratory equipment
to detect the minute differences, uh, between the two products.
And as lab-grown diamonds have gotten better,
they've also gotten cheaper,
which brings us to number seven in the playbook--
if you can't beat 'em, join 'em.
In 2016, De Beers and its peers in the natural-diamond industries
slapped back against lab-grown diamonds
with an ad campaign called "Real Is Rare."
[woman] It will be kind, and it will be real.
[Abram] But then in 2018,
De Beers actually launched their own lab-grown diamond line
at the lowest prices on the market.
They claim that's how much they're worth since they're mass-produced.
But some say this is a strategy to make lab-grown diamonds seem worse.
The efforts of De Beers
to price light-box diamonds at such a low price point
are a very clear effort to denigrate the product.
Laboratory-grown diamonds are superior to dirt diamonds
or mined diamonds that have come out of the earth.
But lab-grown diamond companies are capitalizing on the lasting connection
between diamonds and love.
As someone who's in the business of selling diamonds,
I like the connection.
A connection they owe to De Beers.
The lab-created producers want to market their product
as a more innovative
and environmentally friendly, um, you know, product
that's superior to natural diamonds in those ways.
But at the same time, they still want the value associated with diamonds
that, you know, that De Beers created over a hundred years.
The narrative is what a lot of purchasers
might feel on some level is like the bullshit, right?
Like, "They-They told us this story that, you know, you got to do this,
and this is, like, how you prove love."
I think the thing is, though,
that, uh, there's something really, really deeply touching
about doing this for somebody,
about wanting to be very public about how you feel about somebody.
And in a way, uh, burning a pile of money
is a pretty compelling argument
that you feel what you say you feel.
Just because the connection between diamonds and love
was manufactured by marketing, that doesn't make it less real.
It was the most beautiful and most significant thing ever to me,
not because it's a diamond, but because he's my best friend.
He was like, "This was my mom's diamond."
That's when I really started crying.
When you put it into perspective that an ad campaign drove,
you know, what we now consider, like, the step to getting married,
you have to buy a diamond, it's kind of infuriating to think about,
but at the same time, it makes-it makes sense.
Like, I didn't come up with this. This is just the-the world's standard.
A diamond is a product of heat,
time, capitalism, and us.
It isn't bullshit,
because the volume of people
who kind of are convinced by it
tells us that their story
is tapping into this complexity of who we are.
And when you think about it, so much of what we do,
so much of what we wear, you know, what we carry.
So-So much of it is about communicating who we are.
Here's my diamond. It's absolutely stunning, in my opinion.
What do people want?
Uh, how much do they want it?
What are they willing to pay for it?
The question becomes more, "How do you value different things?"
And I think diamonds are a little bit of, uh--they're kind of like an ink-blot test,
and you can kind of see what you want and make your own criteria
in terms of what's the most important to you.
He's my everything, and...
through thick and thin,
and that just meant the world to me when he gave me this ring.
-I love seeing it on your hand. -I know. I love seeing it on my hand, too.
[laughs]
Thank you.
I think the value of a diamond is zero.
It's entirely the value you have,
uh, in regards to the person who gave it to you.
[closing music playing]