The new Clinton Omnibus Counterterrorism Act plans to combat terrorists by 1) the hiring of 1000 new federal agents 2) allowing the government to trace materials used in explosive devices, and 3) expand the role of the military in fighting terrorism. The White House also wants to expand the government's role in electronic surveillance. Electronic surveillance evidence could not be surpressed, unless it was acquired in bad faith. The plan also authorizes "roving wiretaps". The US government also wants to give federal agencies access to consumer financial and credit reports. Hotels, motels, bus companies and airlines would be required to provide records to the FBI. The plan also requests funding for a counterintelligence fund and the creation of an interagency domestic counterterrorism center.

Ira Glasser, executive director of the American Civil Liberties Union, says, "This will violate the privacy of a lot of innocent people with very little result. It's an end run around the Fourth Amendment." According to a recent AP poll, 54% of Americans believe the government must stop terrorism, even if it invades some people's rights and privacy.

The US Treasury is getting ready to change our currency to purportedly defer counterfeiters. The US Treasury said it would release new notes in 1996 with better security features. The plan is to make over $100 notes, the supposed most favorite denomination of counterfeiters. An enlarged portrait of Ben Franklin will be moved to the left on the $100 bill, making room for a new watermark engraving. The borders will be simplified with geometric designs. A color-shifting ink will be used so money will take on a different hue when viewed from an angle. All denominations will be new by 2001. About $367 billion is now in circulation, with 60% of it overseas.

Recently, The Gemstone Forecaster has come across a new gemstone web page on Internet. We are reprinting their August newsletter with permission. Thank you! To visit the site go to GemNET.

For three months, GemNET has been surveying gem and jewelry dealers, lapidaries and collectors in order to compile a report of the "hottest" gems on today's market and to try to predict what stones will become popular in the future. This information is designed for the jeweler, collector, or investor who wants to know what stones he should be trying to procure before the prices rise. Keep in mind that this forecast is only speculation based on the information that we collected. Investing in gems is a risk, just as investing in precious metals is a risk.

Three Stones with a Good Outlook
According to a good deal of the people we surveyed, several stones look like they may soon gain much more popularity than they already have among the general public: tanzanite, tsavorite (green grossular garnet), and chrome tourmaline. All three of these stones were once much rarer, but foreign investment in the East African countries where these stones are mined has allowed these countries to produce enough stones to produce a market while maintaining a strong degree of rarity. Please note that the rarity of good quality tanzanite and tsavorite is down played by the large quantities of pale, poor quality stones that cheap jewelers and shop-at-home channels sell to the public.

Stones That Will Lose Popularity
Burmese rubies are a great investment stone and for that reason, few clean, unheated Burmese stones of any size hit the commercial jewelry market. Instead, many jewelers are selling bright red, but totally opaque Burmese material as Burmese ruby. While these stones are well colored, they really are not gem quality, and the few stones that are should really have been cut en cabochon. Unfortunately the general public has not learned that the stones they are buying as Burmese really aren't that valuable or exceptional as far as rubies go. Within the next year or two, consumer groups will catch onto this misleading practice of selling opaque Burmese material at a premium and the clearer Thai and Sri Lankan material will become the standard ruby that the gemologically ignorant public will want.

A Stone That May Be Regaining Popularity
Ever since the Cleopatra emerald mines were discovered in Ancient Egypt, peridot has been exiled into use in poor quality birthstone jewelry. Now, however, a find of gemmy crystals and rough in Pakistan has produced a few large, clean, and surprisingly richly colored stones (unlike material from Arizona). Peridot has been surrounded by years of unpopularity, but this new discovery may usher this stone into the limelight - Which happens to be its color.

Any questions or comments should be addressed to

The following excerpt is reprinted with permission from Peter Rowe, a graduate gemologist in Detroit. Thank you Peter! It is an excellent description of GIA's new colored grading system. Unlike the AGL Colored Stone Grading Report, the GIA does not issue a certificate. The basic system is based on the Gem Set colored grading system. Although National Gemstone has serious problems with Gem Set compared to AGL's Color Scan, the following is important educational information. Let us know what you think.

Color is divided into three basic properties: Hue, Tone, and Saturation. Hue is the basic color, such as red, blue, slightly greenish blue, etc. The color wheel is divided into 3 basic hues and 28 derivatives, plus allowing the terms pink and brown as exceptions to the basic terms.

Tone is the scale from light to dark, regardless of color. It's rated from 1 to 10, with the following descriptions:

0 colorless or white
1 extremely light
2 very light
3 light
4 medium light
5 medium
6 medium dark
7 dark
8 very dark
9 extremely dark
10 black

Saturation is the intensity of color, like the color control on your TV which changes it from black and white to garishly more colorful than reality. Low saturations are described as a degree of grayishness for cool colors (like blues and greens), and brownishness for warm colors, yellow, red etc. The saturation terms are:

1 grayish (brownish)
2 slightly grayish (brownish)
3 very slightly grayish (brownish)
4 moderately strong
5 strong
6 vivid

Using these terms it is possible to write simple color descriptions that make a certain intuitive sense, as well as being a repeatable standard. You describe a color as hue, tone, and saturation. If the person writing the description and the one reading it have access to either the gem set samples or a colormaster (for which settings for each sample are defined), then quite precise color communication is possible. But it's important to note that even so, there's a bit of room for slop or play in each color description. The eye can discriminate between exceedingly fine differences in color. So it's possible to have several slight variations of color that all fit pretty much into one description.

In a few cases, notably the finest rubies, sapphires, and emeralds, those faint differences can equal substantial differences in price, so this system isn't quite up to completely perfect accuracy, much less a really precise pricing structure based solely on stated color descriptions or grades. It will remain necessary for gem dealers and consumers to actually look at the stones, and visually evaluate what they see.

Grading Color
Now that you've got a way to communicate what a given color is, a way is needed to suggest which ones are better than others. It's no longer as simple as a linear scale like diamond grading uses. For the GIA colored stone grading system, what's been done is to create a long series of grid charts, listing colors for each gem variety. For each gem, and for each hue that that gem commonly occurs in, a chart is drawn with tone values from 2 to 8 vertically and saturation values from 1 to 6 horizontally. Then a numerical grade from 1 to 10 is assigned in each space where the gem commonly occurs in that hue/tone/saturation combination. The grade isn't linear, or absolute. It is only meant to suggest relative desirability from one stone to another.

In Blue Sapphires (Violetish/blue), for example, one of the charts looks like this:

For example, a stone that would receive a 10 (the theoretical best or finest) would be a blue sapphire (violetish/blue) with 6 (medium dark) tone and 6 (vivid) saturation.

The first difference between colored stones and diamond is that clarity has different meanings for different types of stones. Thus in an emerald, a stone that appears to the naked eye to be reasonably clear with only a few minor inclusions visible to eye is considered a pretty good emerald, clarity wise, yet if it's an aquamarine those same inclusions probably make it a not very desirable stone, as aqua is usually desired completely free of inclusions to the eye, and even under 10x. Therefore, the GIA colored stone grading system divided stones into three basic clarity types, and then assigns different meanings to the grades within each type.

Type I are stones which often grow flawless, or nearly so, such as aquamarine, citrine quartz, or green tourmaline. Visible Inclusions are usually quite detrimental to the value.

Type II stones are those which generally grow with moderate inclusions, such as ruby and sapphire, amethyst, garnets, etc. Some inclusions are expected, and unless obvious, are not as detrimental to the desirability and value.

Type III stones are those such as emerald and red tourmaline, which virtually always have inclusions, and those inclusions are well tolerated. In these stones, unless the inclusions become extreme, they often have relatively less effect on a stone's desirability.

Within these general classes, the GIA system then assigns grades which look similar to the diamond grades, but are modified to fit the expectations in colored stones. There is no flawless or IF grade in the colored stone system, as it was felt that no colored stone could attain and maintain in wear the standards for that term that are so well defined in diamonds. There are eight clarity grades. The highest is VVS, then VS. These two are not subdivided as in diamonds. The SI grade is divided into SI1 and SI2, and the I grade is divided into I1, I2, and I3. I won't go into the fine details but the general reasoning behind the definitions is pretty much what you'd expect.

Cutting is graded upon shape, symmetry, brilliance, polish, the degree of extinction (black dark areas) and windowing.

Supposing you now have a complete GIA system grading report on a given stone. Or perhaps the AGL grading report, which uses different terms, but does about the same thing in the end. What do you actually have? What you've got is merely a description. Hopefully a fairly accurate one. As yet these grading terms are only in sporadic use among the professionals talking among themselves. It may well be that this is for the best, as in most cases it still takes a practiced eye to evaluate what all that data means. Once, diamond grading too was only a professionals only practice, and diamonds were sold by stores according to the stores' own beliefs as to what was desirable or not, with little mention made of the exact terminology used by GIA. Some day, the colored stone industry may take for granted the practice of describing color and quality in universal language, so we can all understand what we are all saying to each other.

You can e-mail Peter at

The information provided in this newsletter has been derived from research and sources believed to be reliable. However, no guarantee is expressed or implied as to their validity. Opinions included herein are subject to change without notice. Potential investors or collectors should understand past performance is not a guarantee of future performance. This is not intended as an offer or solicitation with respect to the purchase or sale of any security, nor is it intended to be investment advice.

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Call: 1-800-458-6453 or (520)-577-6222







For comments, questions or price quotes E-mail NGC, Attn: R. Genis

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