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http://www.aei-ideas.org/2013/06/on-the-economics-of-diamond...

Americans exchange diamond rings as part of the engagement process, because in 1938 De Beers decided that they would like us to. Prior to a stunningly successful marketing campaign in 1938, Americans occasionally exchanged engagement rings, but wasn't a pervasive occurrence. Not only is the demand for diamonds a marketing invention, but diamonds aren't actually that rare. Only by carefully restricting the supply has De Beers kept the price of a diamond high... this obligation only exists because the company that stands to profit from it willed it into existence.

The next time you look at a diamond, consider this. Nearly every American marriage begins with a diamond because a bunch of rich white men in the 1940s convinced everyone that its size determines your self-worth. They created this convention – that unless a man purchases (an intrinsically useless) diamond, his life is a failure – while sitting in a room, racking their brains on how to sell diamonds that no one wanted.

We covet diamonds in America for a simple reason: the company that stands to profit from diamond sales decided that we should. De Beers' marketing campaign single-handedly made diamond rings the measure of one's success in America. Despite its complete lack of inherent value, the company manufactured an image of diamonds as a status symbol. And to keep the price of diamonds high, despite the abundance of new diamond finds, De Beers executed the most effective monopoly of the 20th century.
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More proof that rich white men are at the root of all our problems.

--fleg, whose penury mitigated against the purchase of a diamond ring
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