Diamonds Are ... Prudent? Why Jewelry Sales Will Shine This Holiday Season

Are diamonds the ultimate recession buy? Recent data seems to suggest that our current economic turbulence is sending some Americans to the jewelers.

Fine jewelry sales are expected to sparkle this holiday season, outshining much of the rest of the retail sector -- which is projected to generate just so-so sales, said Dr. Michael Haydock, retailer analytics leader for IBM (IBM).

Jewelry could be getting a lift from strong luxury sales, as wealthier consumers continue to shop. But industry analysts at a recent conference expressed uncertainty as to why this high-ticket product is selling so briskly in a down economy.

According to IBM's forecast, jewelry sales are poised to climb 7.7% to $2.66 billion this November from 2010. And in December, sales will rise to $5.4 billion, up 4% from 2010.

The rise is surprising considering the overall weakness in the economy and the recent stock market gyrations. However, these wild market swings are known to spark more prudent style of spending. Diamonds? Prudent? In this case, buying jewelry is seen as a way to extend one's wardrobe by changing up one's look without buying a whole new closet of clothes, Jill Puleri, vice president and global retail leader for IBM global business services, said during the press dinner.

The jewelry business has been strong all year, with unit sales through August up 11.4% compared to 2010, Ken Gassman, president and founder of the Jewelry Industry Research Institute, tells DailyFinance. However, a hefty 8.4 percentage points of that increase is the result of rising commodity prices, especially in the metals markets, which have jacked up the price of gold, silver and platinum, he said.

In the end, Gassman says, Americans just want to spend again: "People are tired of the recession. Remember, there are a couple of adages that define American shoppers: A, When the going gets tough, the tough go shopping; and B, Americans are born to spend."




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6 Comments

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gemstone102675

I think its a good idea.Buy a ring or neckless wear it for a while than scrap the gold and get something different.

October 18 2011 at 9:43 AM Report abuse rate up rate down Reply
bestxpress

It's nice to know someone can afford a diamond...I hope that top 2 percent buy lots.

but for the other 98% how about affordable health and dental with no
deductibles and no limits
-visit shermanoffice

October 16 2011 at 4:09 PM Report abuse -1 rate up rate down Reply
spiritualmind29

Actually, this is a very good article. The BEST investors are making money right now, so of course buying for their loved ones is going to happen. This is the best article on Daily Finance I have seen! Finally!

October 15 2011 at 9:43 PM Report abuse +1 rate up rate down Reply
Ken Lupi

buy more so the fat gets richer ask the people all over the country out side protesting what they think

October 14 2011 at 7:38 PM Report abuse rate up rate down Reply
rgkarasiewicz

Jewelry is never a good investment. There is an excessive markup at purchase, and a large markdown at sale.

October 14 2011 at 6:35 PM Report abuse rate up rate down Reply
Thomas J. Brean

Yeah, maybe everyone can buy this badly-timed jewelry with their overdrawn black cards lol.

October 14 2011 at 6:30 PM Report abuse rate up rate down Reply
marine1942

This article was written by Berry and Ben who have brought you this recession.

October 14 2011 at 5:49 PM Report abuse +3 rate up rate down Reply