TABLE OF CONTENTS

• US Sanctions on Burma Help China
• Yellow Diamonds Are Hot
• New Glass Ruby Treatment
• Gem Scam on Ebay
• Collectors Corner
• In The News

US Sanctions on Burma Help China
by Robert Genis

Over a year ago President Bush signed the Burmese Freedom and Democracy Act closing the U.S. market to imports from Burma (Myanmar). The purpose of the sanctions was for the cutting off of trade between the United States and Burma to force democracy in Burma. Although we oppose the imprisonment of Aung San Suu Kyi and believe the National League for Democracy is the elected government of Burma, it is unclear what benefit the sanctions are really having on the political human rights situation.

The Reality of Sanctions
In The Gemstone Forecaster VOL. 21, #3, Fall,2003 we stated:

“What is unusual about this embargo is the US is not a major trading partner with Burma, and the embargo is unlikely to have any real impact on the internal policies of Burma. The countries that do trade with Burma are China, Singapore, Malaysia, Thailand, India and Japan. The sanctions will not work unless the U.S. can get China and the other ASEAN nations to go along.”

Regretfully, this turned out to be the case. According to the US State Department, Burma lost about $200 million in the first year of the ban on imports to the United States. However, the trade between China and Myanmar amounted to about $1 billion in 2003. China's deputy prime minister pledged to expand trade to $1.5 billion in 2005. China has offset the American sanctions and kept Burma afloat with easy credit and trade and is assisting Burma’s military leaders.

New Chinese/Burma Deals
Recently, Burma's prime minister received a series of accords from the Chinese on new railways, a fertilizer factory and mine exploration. China gave Burma a $150 million loan for telecommunications plus $94 million for rescheduling of debts. Chinese officials are also willing to finance vital hydroelectric dam projects since no one else will. In addition, the Chinese have proposed building a pipeline be built from a port on Burma's west coast, to Kunming, the capital of Yunnan Province, allowing China more direct access to Middle East oil.

Gemstone Reality
What is China getting from Burma besides political influence? Burma is sending their best teak wood and best gems to China today for their assistance. This includes top unheated Burma ruby and sapphire, Burma spinel and jade. This is the real effect of sanctions for the international gemstone industry. The amount of gemstones from Burma into the United States has dwindled and what few manage to bypass the ban are dramatically higher in price.

Recommendation
To all the collectors who bought Burma goods in the past, this is surely good news because your gems have increased in price. For new collectors, you will have to pay what the old collectors want to get unheated Burma goods. This appears to be very similar to what has happened in the Kashmir blue sapphire market. Our advice remains the same- with white and colored diamonds, precious metals and oil increasing- buy and hold Burma gemstones because they have no where to go but up in price until the sanctions are lifted, if that ever happens.

Yellow Diamonds Are Hot
by Robert Genis

Nature creates so few fancy colored diamonds that they account for less than 1% of all diamonds offered on the market at any given time. It has been estimated that only 1 out of 1000 diamonds fit into the yellow grading classifications. Celebrities have fallen in love with colored diamonds and the trend is inspiring consumers to follow suit with all diamond colors. The two recent high profile purchases include Jennifer Lopez’s $1.2 million 6 carat pink and Kobe Bryant’s $4 million 8 carat purple diamond. The individuality of colored diamonds is another driving force behind the trend. Compared to white diamonds, the supply of colored diamonds is more limited and therefore each stone is more unique. These colored diamonds are hot - especially the yellows, both the natural yellows and the new lab created yellow “cultured” diamonds from Gemesis.

Why Diamonds Are Yellow
Colored diamonds come in all shades, which are caused by impurities in the elements that formed the diamonds. Nitrogen is the cause of the yellow color in both natural and synthetic yellow diamonds.

The Tiffany
Besides the Hope, the next best known diamond is the Tiffany yellow. It was found in the De Beers mine at Kimberly in 1878 and weighed 287.42 carats. The following year it was bought by Tiffany and was cut in Paris as a cushion and weighs 128.51 carats. Although a few yellow diamonds are larger than The Tiffany, this stone has been seen in many expositions around the world. Today the diamond remains on permanent display on the ground floor of the Tiffany & Co. store in New York City. The stone has never been officially graded by the GIA.

Color Grades, Certs and Clarity
The intensity of the yellow with these diamonds is of prime importance.
The main yellow color grades that people trade in are fancy light, fancy, fancy intense and fancy vivid. Fancy deep and fancy dark yellow are shunned in this marketplace.

Of course, you must trust your dealer or buy an important diamond with a GIA Grading Report. Many colored diamonds are traded simply with colored diamond and origin reports. This is due to the fact clarity is not as important with colored diamonds as with white diamonds. It really doesn’t matter if a stone is flawless or VS2- it will probably look the same to consumers and collectors.

Secondary Colors
The two most desirable secondary colors with yellow are orange and green. An orange secondary makes the stone really electric and these diamonds are desirable. Green yellow is another sought after color combination. This is the only way for many to get a green color without spending six figures. The worst comment on a grading report for a yellow diamond is brown. This color kills the stone and makes it almost impossible to market. You sometimes see stones that may say brown, green and yellow and they are really unattractive.

Gemesis “Cultured” Diamonds
Gemesis Corporation of Sarasota, Florida has diamond-making growth chambers, each weighing about 4,000 pounds and costing about $50,000. Each chamber produces about eight 3-carat rough stones per month. Gemesis has 27 chambers and plans to increase the number to 200 in two years. Soon, they hope to produce close to 20,000 carats a year. Carl Shrode of Shrode Jewelers, Sarasota, Florida is a high end retailer who, interestingly, markets both natural fancy yellow diamonds and Gemesis yellow “cultured” diamonds. Gemesis yellows are in demand right now because many people are concerned about “conflict” diamonds and some also mention the idea that buying diamonds funds terrorism. Shrode primarily markets to people from 45-80 years of age, and the average sale is $8000. Shrode states, “we market both types of diamonds. The main problem we have with the Gemesis diamonds is they are only available in 1- 1 1/2 carat sizes. We have many clients looking for 3-5 carat sized stones and they must buy the natural yellows.”Shrode's store has been inundated with reporters from the print and news media since he started marketing the Gemesis diamonds. Shrode continues, “It is interesting but we have had people come from Great Britain and Japan to buy these stones because of the media attention we have received.” He describes the stones as intense yellow although some have orange secondary colors.” Schrode's only concern with Gemesis diamonds is unscrupulous people will repolish the girdle and resell the stones as natural. These stones come with laser inscriptions and identification reports from the International Gemological Institute (IGI). Schrode states, “The stones are detectible because they have small black inclusions.” Shrode sees the two types of yellow diamonds as complementary products not competitors. “Some people will always want a Louis Vuitton bag and other people will always buy the look alikes. It is the same for colored diamonds. Some will always buy the naturals yellows and some will want the same bang for a smaller buck.” The Gemesis diamonds sell for about 1/4 of the price of natural yellow colors.

Natural Yellow Pricing
Prices have remained firm for natural yellows or are rising in price- amazing given the recent recession. Fancy light yellow diamonds sell for a discount to fancy yellows. Carat size fancy yellow will wholesale for approximately $5000 per carat, a carat size fancy intense will sell for about $7000-$10,000 per carat and a carat size fancy vivid will sell for about $14,000-$20,000 per carat. In other words, a vivid brings a 100% premium over an intense yellow and these diamonds are difficult to find. Vivid yellow round diamonds are practically impossible to find. Expect another 100%+ premium for these rare diamonds.

Marketing
The two main markets for yellow diamonds are collectors and jewelry buyers. Collectors buy these stones because they are inexpensive compared to pink, blue, orange, and green diamonds. Given the rarity of yellow diamonds, they really should be dramatically more expensive than comparable white diamonds. Jewelry buyers covet these stones because they are different than white diamonds and are viewed as being valuable due to their rarity.

Summary
Many feared Gemesis launched an all-out attack on the diamond industry when retailers started marketing jewelry featuring Gemesis-made fancy yellow diamonds. This has turned out not to be the case. Instead, both types of products appear to be coexisting and serving different market niches. This will remain the market reality unless these synthetic diamonds become indistinguishable from the real natural product.

New Glass Ruby Treatment
by Robert Genis

Being a member of the colored gemstone industry has always been tricky. Some say it is now becoming treacherous. A little over 10 years ago, a new find of Burma ruby entered the United States market from Mong Hsu. It was later discovered the stones were heated and fracture-filled. Although glass is often found in the Mong Hsu material, it is the result of the healing of fractures after the material is heated with borox and other chemicals. More recently, the new beryllium diffused treatment process caused panic in the international markets after that treatment was uncovered. It now appears another new treatment method may be entering the marketplace. The new treatment is essentially a Yehuda treatment for ruby that injects a high refractive index glass into the fractures of ruby which visually improves the clarity.

Diamonds
Diamonds have been treated by fracture-filling since the technique was first used by Israeli scientist Zvi Yehuda, of Ramat Gan, Israel in the mid 1980s. The purpose is to impregnate the cleavages or fractures with highly refractive glass to improve diamond clarity. This treatment is usually detected by a rainbow-colored light called the “flash effect.” The main colors seen are usually blue, yellow or orange. As a general rule, the host gemstone and the impregnated material should have very close refractive indices and different dispersion to show a “flash effect.” Today, this treatment is accepted if disclosed, and a few diamond companies produce and market these stones as clarity enhanced diamonds. If the treatment reverses due to high heat or strong acids, the companies will re-enhance the diamond at no charge.

GAAJ
In March 2004, The Gemmological Association of All Japan (GAAJ) first identified the glass-filling technique in a ruby. They graded a 13.22 carat ruby that was heated and was probably African in origin. The ruby had many surface-reaching cracks needed by the treaters as a portal for filling via this method. A blue to purple light effect (flash effect) was observed. X-ray fluorescence analysis also detected the presence of lead.

AGTA
In July, 2004, The American Gem Trade Association reported testing a 16 carat faceted ruby treated by a glass-filling process. This stone appeared to be unheated, unlike the one seen in Japan. The stone was probably African and considered low quality. The glass-filling was detected by viewing the “flash effect.” A spectrometer confirmed the presence of leaded glass in the fracture of the ruby.

Gem Dealers Reactions
Richard Hughes of Pala, Fallbrook, CA does not expect large quantities of these stones to enter the market. Presently the few stones seen are low quality with surface breaking inclusions. Hughes states, “I take a position similar to that of the diamond dealers on fracture-filled diamonds. As long as the treatment is disclosed and priced properly, it is not a problem." What is the average jeweler or gem dealer to do about the emergence of this new treatment? Hughes contends, “Most dealers and jewelers will need labs. Only a few have the skill necessary to spot this new treatment.”

A Chicago gem dealer says, “We will shy away from this new material. My company sees numerous stones in New York with grading reports showing heated ruby, which you never saw 5 years ago.” They buy most of their ruby on trips to Bangkok and Hong Kong. He concludes, “We trust the people we have been doing business with for over twenty years but we will now look for glass filling via the “flash effect.” As you know, accurate disclosure is not rampant overseas.” Not all in the colored gemstone industry view this new treatment as a problem. A gemstone dealer who wished to be anonymous stated, “I don’t understand what the big deal is with this new treatment. Are the laboratories and gem organizations simply trying to scare us? I see this treatment as a last resort for low quality included stones that sell for a couple of hundred of dollars per carat. Anyone who is going to spend serious money on a gemstone is going to demand an independent grading report from a major lab, so what is the problem? I don’t believe this will affect the main ruby market at all.”

Summary
This new technique currently is not widespread in the ruby market. However, alerts have been issued to advise members of the trade that rubies treated by this method are now present in the U.S. market.

The real question is what will another new treatment do to the overall gemstone market? Any new treatment can potentially give the industry a black eye. This new treatment is another reason why it is critical for collectors or jewelry buyers to have an American Gemological Laboratories (AGL) grading report when buying an important ruby. Gem dealers buying or selling ruby should be sure to look for signs of this new treatment.

Gem Scam on Ebay Halted

Buying gems on Ebay has always been a chancy proposition. Most of the gems sold are low end and misrepresentation is rampant. Ebay is becoming known for offering little if any support in helping consumers get their money back.

A Springfield, Missouri man was recently arrested in connection with an investigation into the sale of fake gems on EBay. The suspect was taken into custody after investigators from the Missouri Highway Patrol's Division of Drug and Crime Control executed a search warrant at his home. Seized were business documents, shipping records, computer equipment, and "thousands" of what authorities suspect are fake gemstones. The final decision on the gemstones will come from a gemologist who will examine the stones for the department. A Virginia resident complained about suspected fraudulent activity concerning the gems after purchasing gemstones from the seller. Investigators believe the suspect would sell the stones as authentic on EBay, and would either send fake gems or nothing at all. There are at least 83 victims in various states and countries who attempted to buy the stones from the suspect. A call to the San Jose, Calif., headquarters of EBay by a local Missouri newspaper went unanswered .

Collectors Corner
Rolls Royce
The Spirit of Ecstasy is certainly the most attractive and probably the best known motor car mascot in the world. Designed by Charles Robinson Sykes, she has adorned the radiators of Rolls-Royce motor cars since 1911 and concealed a hidden secret. This mascot was modeled after Lord Montagu’s mistress- Eleanor Velasco Thornton. Regretfully, her social status restricted them from ever marrying the man with whom she had fallen in love. Eleanor Thornton never appreciated the success of the Spirit of Ecstasy . She lost her life in 1915, on the SS Persia, while on passage to India. The ship was torpedoed off Crete by a German submarine. She had been accompanying Lord Montagu who had been directed to take over a command in India. Recently, New-York based diamond house Verstandig & Sons, Inc. created a diamond lady for this exclusive auto with 12 carats worth of diamonds. The prototype of this exclusive diamond Spirit of Ecstasy mascot went on display in a Manhattan Rolls Royce dealership. No official price has been announced.

MTV Bling Bling
The Oxford English Dictionary has recently drafted an entry for the latest term, "bling bling." The term, which is used to describe diamonds, jewelry and all forms of showy style. It was coined by New Orleans rap family Cash Money Millionaires back in the late '90s and started gaining national awareness with a song titled "Bling Bling" by Cash Money artist BG.

The MTV Video Music Awards ceremony, is becoming the hot show for rappers and hip hop artists to show off “bling bling.”

Here are some of the highlights:

*Christina Aguilera wore a three-row diamond bracelet and three stacked diamond bracelets.

*Ashanti had an Art Deco diamond bracelet valued at $15,000, a diamond right hand ring valued at $25,000, an Art Deco diamond necklace and diamond chandelier earrings valued at $22,500.

*Beyonce wore 15 carat diamond studs and a 32 carat yellow diamond ring valued at $2 million.

*P. Diddy, the bling leader, had on $8.3 million dollars of diamonds including an 18 carat diamond ring, a 23 carat yellow diamond ring, a diamond bracelet and a diamond watch. Later, he was seen with an HP iPod set with diamonds.

*Missy Elliot wore $500,000 of diamond jewelry that included a turntable pendant with diamond necklace, a diamond turntable ring and a customized diamond watch with her name.

*Mob daughter Victoria Gotti wore a pear-shaped diamond necklace totaling 95 carats, valued at $395,000, a pear-shaped diamond bracelet, totaling 58 carats, valued at $165,000 and an Asscher-cut diamond right hand ring totaling 25 carats, valued at $500,000.

*Paris Hilton wore a 24 carat diamond bracelet.

*Alicia Keys had on fancy yellow diamond earrings and a yellow diamond ring totaling 11 carats valued at $500,000.

*Jo Jo wore pink diamond hoops and pink diamond bangles.

*Queen Latifah had diamond hoops with inner chandeliers valued at $100,000 and a diamond rose cut flower cuff valued at $200,000.

*Lil’ Kim wore a 26 carat pink diamond right hand ring and an Asscher-cut chandelier earrings and diamond bracelet.

*Jennifer Lopez wore diamond chandelier earrings, a multicolored natural blackened diamond mesh bracelet and two blackened rose-cut diamond cuffs.

*Remy Martin wore a diamond necklace with fancy yellow and white hearts totaling 80 carats, valued at $135,000, a multicolored diamond cross and chain totaling 15 carats, valued at $30,000, a diamond bracelet totaling 15 carats, valued at $80,000 and diamond chandelier earrings totaling 19 carats, valued at $89,000.

*Nelly wore 500 carats or $5 million dollars of diamond jewelry.

*Gwen Stefani was adorned with 9 carat diamond stud earrings,a rose-cut diamond bangle and 12 carat yellow diamond right hand ring.

Arkansas Diamonds
Couple Finds 2.68 carat Arkansas Diamond

Don Hing Lo and Cecilia Cheung of Peekskill, New York, decided to travel to the Crater of Diamonds State Park, Arkansas’s diamond site, after reading a guide about geological attractions. The couple’s first visit to the park proved extraordinary lucky when they discovered a 2.68 carat white gem around after only 30 minutes of prospecting in the park’s diamond search area. The 2.68 carat white diamond is the color of an ice cube, and a teardrop-shape that resembles a large drop of water. The couple rented a box screen and digging tools at the park before they made their diamond discovery. The Cheung’s discovered the gem while wet screening at one of the park’s washing pavilions. The park regularly plows the search area to turn up new soil for park prospectors, and plowing has been done two days previously. They thought the diamond was a piece of glass or plastic but the couple kept the stone out of curiosity. Later, a park staff member identified it as a white diamond. The three most common colors found at the Crater of Diamonds are white, brown and yellow, in that order. The most famous diamond found at the park is the 1.09 carat D-Flawless “Strawn-Wagner Diamond” in 1990, a white gem that weighed 3.03 carats in the rough before it was cut to in 1997 by Lazare Kaplan. The gem is on permanent display in a special exhibit in the Crater of Diamonds State Park visitor center.

Rock Stars Album Dedicated to Suu Kyi
On October 26 musicians from around the world will together launch a music album dedicated to freeing Burmese democracy leader Aung San Suu Kyi, who is currently under house arrest in Rangoon. Songs from U2, Pearl Jam, Coldplay, Sting, R.E.M., Travis, Indigo Girls, Paul McCartney and Eric Clapton will be included in the album, entitled For the Lady: Dedicated to Freeing Aung San Suu Kyi and the Courageous People of Burma. The two-CD album has 27 tracks and was organized by the Washington-based US Campaign for Burma.

Safety Deposit Surprise
In Singapore, a wealthy businesswomen died and the Inland Revenue Authority commissioned a gemologist to open her safety deposit box to to determine the estate duty owed. It took the gemologist 12 days to measure each stone, examine if it was genuine, and announce the cash value of the goods at $4 million.

Hells Angels after Canadian diamonds?
According to the Criminal Intelligence Service of Canada law enforcement officials, Hells Angels are joining Eastern European crime gangs in trying to muscle in on Canada's diamond industry. Gangsters are looking at mining companies, stock markets, warehouses and cutting and polishing operations as the best sources of infiltrating the industry.

In The News
Treasures from the ground
Morgan Hill Times
August 24, 2004

Gems are among the most gorgeous examples of nature at work, even though the jewels we admire get a helping hand not afforded to phenomena like sunsets and snow-capped peaks. When we imagine gemstones, few of us picture hunks of rough minerals formed deep in the Earth’s core. Instead, it’s polished, faceted little dazzlers set in jewelry that we have in our mind’s eye - even though they may also have been heat-treated, dyed, irradiated, laser-drilled, oiled and fracture-filled to produce greater color saturation, clarity and weight. And if we don’t get excited by such images, people expecting gifts from us this holiday season certainly might.Apart from geologists, few people would consider gemstones in their natural state to be particularly beautiful - though ideas of what is “natural” and “unnatural” are not entirely clear-cut. After all, even a gem merely extracted from its host rock could be considered “unnatural.”Generally, though, humans have been untroubled by this hair-splitting for a long, long time. Our ancient ancestors mostly just liked the bright shiny things they came across in their daily lives. Millennia ago, people living inland collected the attractive pebbles they found along riverbanks, and coast-dwellers gathered up shells and coral.After a while, people figured out they could stick gems in wet clay and bake them in the sun to create an even lovelier token. Or drill holes in mussel shells and string them together to make a necklace. After thousands of years of this sort of thing, people began mining, cleaving, polishing and shaping gemstones, harvesting and stringing pearls, and setting them in jewelry with improving metallurgical technology.

Which brings us to modern times - those three-month’s-salary engagement rings and all the rest. Let’s look at some of the gemstones we all know and love.

Diamonds
Diamonds are by far the most popular gems on the planet and, for a number of reasons, they have come to dominate the gemstone trade. Diamonds are famously the hardest substance known to man - even being said to tip Cupid’s arrows - but they are also easily split along the cleavage points of their crystal formation, making them fairly easy for manufacturers to work with. The ancients valued diamonds - then mostly found in streams - for their hardness, though they did not have the technology to bring out a stone’s maximum beauty by polishing and faceting. While fairly rare, and now almost exclusively extracted by deep-bore or open-cast mining - diamonds can be wrested from the earth at a high rate of return in countries where labor is cheap and environmental controls are lax. They have a high refractive index, meaning cut diamonds show a great deal of “brilliance,” “scintillation” and “fire” - in other words, they’re sparkly.There are other gemstones rarer by far. Still others possess higher
refractive properties. But a combination of several superior qualities caused diamonds to be prized long before market leaders De Beers ever stepped into the picture. Born out of the Kimberley, South Africa diamond rush of the 1860s and ’70s, De Beers formed through an unlikely alliance of two Englishmen - upper-class colonialist Cecil Rhodes and Barney Barnato, a boxer-cum-actor from London’s East End. The company - named after a Cape Colony farm they bought from a family called De Beers, and where they sank two diamond mines - quickly put strong emphasis on public relations, and by the early 20th century had been able to position the diamond as the “king of gemstones.” The classification and study of diamonds over the past 100 years has far outpaced that of any other gemstone, only adding to the strength of the diamond’s market position. Meanwhile, colored diamonds - ranging from yellows, greens, blues and reds to browns, blacks and pinks - have found a new popularity in recent years, and fetch prices even higher than their “white” cousins on the market. Not that it matters much to the trade which diamond you buy, because from the retail price the shop will keep around 40 percent, while the manufacturer/wholesaler and De Beers (or some other mining company) will each pocket around 30 percent. What’s for sure is that relatively little profit will trickle down to miners in those countries where the gems are mined, notably Botswana (now the world’s largest producer), Namibia, South Africa, the Democratic Republic of Congo, Sierra Leone and Angola. Diamonds are also mined in Australia, Russia and Canada, and continue to be found in small quantities in India, Brazil, Indonesia, Burma and elsewhere. To this day, De Beers, which was taken over in the 1920s by Ernest Oppenheimer, a former clerk in its London office, distributes the majority of the world’s rough diamonds to a select band of around 120 manufacturers. Though De Beers’ pre-eminence is no longer at its 1920s peak, when it controlled about 90 percent of the world’s rough diamonds, at around 65 percent - or $5.41 billion in 2003 - it is still sufficient to have it barred by anti-trust laws from operating in the U.S. (De Beers plead guilty to price-fixing before a U.S. court last month in a move that will apparently lead to the end of over 60 years of anti-trust rulings against the cartel.)

Emeralds
Along with diamonds, rubies and sapphires, emeralds are among the “precious” stones which attract the highest prices of all gemstones at auction, as well as on the wholesale and retail markets. Relatively soft and almost always marred by non-emerald mineral inclusions, emeralds are nonetheless highly prized - largely due to their color, which many regard as the epitome of green. Emeralds are member of a larger mineral family, beryl - but only green, gem-quality beryl is designated emerald. Of late, however, emeralds have lost some of their luster, as the common practice of filling their usual fissures and cracks with nonemerald material to produce a smooth, clean-looking stone has come under fire from the public. While they remain one of the four “classics,” their prices have generally dropped over the past 10 years, from a peak of $11,000 per carat for high-quality goods to a low of $6,000 in 2000. The best emeralds, it is agreed, come from Colombia, while deposits of lesser-quality green beryl occur in Brazil, Afghanistan, Pakistan, Madagascar, Zambia, Zimbabwe, Tanzania and elsewhere.

Rubies and Sapphires
Corundum is the mineral classification of both rubies and sapphires, second in hardness only to diamond. But while a sapphire is corundum of any color other than red, rubies throughout history have been only associated with gems of the deepest crimson and fetch higher prices than even blue sapphires. Indeed, the ancients often described any transparent red gem as a “ruby,” including garnets, spinels and tourmalines. Meanwhile, a constant debate is waged over the cut-off point between pink sapphire and ruby - with the most vitriolic arguments generally coming from those who possess stones perilously close to the divide.Before diamonds came onto the scene, rubies and sapphires held positions of the highest esteem. Legends surrounding these gems are plentiful, such as the mythological valley of rubies that were guarded by gigantic birds of prey called rocs, appearing in the Arabian Nights and elsewhere. Treasure-seekers were supposed to have tossed pieces of meat into the inaccessible valley, where the rubies that literally covered the ground would stick to the meat. The rocs would eat the meat and pass out the rubies in their cliff dwellings. The treasure-seekers could then climb down and claim their prizes. And often get eaten by rocs for their troubles.

Many modern gemstone researchers believe the legendary valley is none other than Burma’s Mogok Valley, where rubies may have been mined since as early as AD 500, and probably long before. It is possible that the tales of predatory birds were created to keep invaders away from the mines, which today continue to yield the finest, “pigeon’s blood” rubies. Burma is the source of the finest rubies in the world, with Mogok the top location and Mong Hsu a source of lesser-quality gems. Cambodia, Vietnam, Madagascar, Kenya, Tanzania and Sri Lanka are also ruby-producing countries, while Thailand now has few of the deposits that once made it a top exporter.

The benchmark for blue sapphires - the most prized color in sapphires - are the highly prized Kashmir gems, but today Sri Lanka, Burma, Madagascar, Cambodia, Thailand and Australia are the chief sources. “Fancy color” sapphires - including pinks, greens, purples, yellows, as well as clear and nearly black corundum - are found throughout the world, most heavily concentrated in the main ruby- and blue sapphire-rich nations.

Semi-precious Gems
For want of another term, “semi-precious” is the adjective attached to any gem that isn’t a diamond, emerald, ruby or sapphire. It’s a designation that isn’t well-liked by producers, dealers and retailers, who generally prefer “colored stones” to describe all gems except white diamonds. And who can blame them, when an incredibly rare and beautiful color-change stone like alexandrite is lumped together with common quartz? Or consider the gems with deep cultural significance, such as jade in China, or those with colors scarcely found anywhere else in the natural world, such as the vivid neon-blue of Paraiba tourmaline, discovered in Brazil in 1989.

Of course, such semi-precious gems often sell for prices that rival the precious quartet, while spinels, garnets, peridots, amethysts, aquamarines, bloodstones, opals and others get their day in the sun thanks to birthstone sales. Other semi-precious gems wax and wane in popularity; witness the tanzanite, tsavorite and spessartite fads of a few years ago, or the current craze in China for Canadian ammolite. With regards to almost all transparent semi-precious gems, most connoisseurs prefer them to be “eye clean,” with no visible mineral inclusions. However, a small number of gems are actually valued for their inclusions, such as rutilated quartz, or for spectral phenomena, as with precious opal’s “play of color” and cat’s-eye chyrosoberyl’s dancing band of light. Semi-precious gems come from all over the world, with the heaviest concentrations in South and Southeast Asia, sub-Saharan Africa and Amazonia.

Organic Gems
All sorts of organic material is used in jewelry, from bones to leather to wood. But “organic” gems are generally taken to mean just three: pearls, amber and coral. Pearls are the natural result of mollusks coating irritating grit with a secreted substance but are now predominantly “cultured”, a process which involves inserting grit - usually small pieces of mollusk shell, actually - into harvested freshwater and oceanic mollusks. Amber received a new notoriety with the film “Jurassic Park,” and coral - popular with Italian jewelry designers and cameo artists - is increasingly rare due to over-harvesting and pollution.

We all know what coral is, but gem-quality coral is a pinkish, smooth variety found in the Mediterranean Sea and generally shaped into cabochons (oval-shaped pieces that are flat on one side) or beads. Amber is fossilized pine-tree sap, which sometimes contains the remains of insects and other creatures trapped in the sticky resin before it hardened, and is found primarily in the Baltic countries and the Dominican Republic.

Lookalikes
Again we must dust off our definitions of “natural” and “unnatural.” A synthetic diamond, strictly speaking, is a diamond - crystallized carbon - but few diamond lovers would agree. Up until recently, it was more expensive to create a synthetic diamond than to mine the real thing. Today, synthetic diamonds are almost exclusively used for industrial and high-tech purposes. For the most part, the “fakes” people buy are more properly termed simulants, or even “stand-ins.” Cubic zirconia, for example, is a synthetic gem, grown in a lab, and is a common diamond simulant used to keep the price of a jewelry piece low. What it isn’t, however, is a synthetic diamond. Glass is the most common gem simulant of all!

The term “simulant” probably reflects marketing agendas more than scientific classification - any time you see a gem, synthetic or not, extolled for its “diamond-like properties,” you’re hearing about a simulant. Meanwhile, everyone in the gem business being extremely touchy about their own products, many sellers of synthetics prefer the terms “created gems” or “man-made” gems.

Gem treatments fly even further below most consumers’ radar. Nearly all gems can be treated to improve their looks, from the gentle heating that brings out tanzanite’s purplish-blue color, to the irradiation of topaz in linear accelerators to achieve a royal blue coloration.

Untreated gems generally attract much higher prices than treated stones - and these days they’re much rarer. Consumers should always ask about treatments from their jeweler.

The Bigger Picture
In recent years, consumers have generally become increasingly aware of
the political and humanitarian repercussions of their purchases - and
so, too, gemstones have been scrutinized. Because both gemstone mining
and manufacturing are concentrated in poor countries, several aspects
of the gem trade have come under fire.

Diamonds have received the most heat of late. The United Nations and several NGOs decry the trade in diamonds from war-torn African nations such as Sierra Leone and Angola, where factions fight for control of diamond mines whose proceeds go toward purchasing more weapons to terrorize civilians.

It has also recently come to light that Osama bin Laden’s al-Qaeda financial network may have included Sierra Leonean diamonds purchased through Liberia’s exiled president Charles Taylor.

Meanwhile, the use of child labor in gem manufacturing in India and elsewhere has drawn the attention of human rights activists for years. Political conditions in Burma and Colombia, the primary sources of rubies and emeralds respectively, have served to taint those gemstones, too.

For lovers of gems, these issues can be confusing. On the one hand, gem mining and manufacturing are vital industries in some of the world’s poorest economies. A consumer boycott or economic sanctions would have devastating consequences for the people who depend on gems for their livelihood.

On the other hand, there is a deep unfairness surrounding the plunder of such natural wonders from the developing world, brought to the West’s luxury markets for the equivalent of slave’s wages in many places. What wealth does flow back to the place of origin is generally scooped up by violent despots and greedy merchants instead of trickling down to the miners and gem-cutters themselves. In the end, for many of us, gems may simply be things to be marveled at, and that’s as deep into the alternately beautiful and sordid business as we’d like to go. Engagement rings aside, of course…