Resale Jewelry - Everything that Sparkles isn't a Diamond

Uncut Diamond, the Sierra Leonean Giant Sefadu, was found in 1970 weighing in at 620 carats. Photo from BBC News

Last week, I had the opportunity to buy some nice resale jewelry, some for trade and a few pieces for my wife. There is wonderful money to be made from buying and selling resale jewelry, but you must have an iron will and a few set rules when buying resale jewelry.

I have never been offered great items at reasonable prices, so there has to be a lot of negotiating before you find a bargain. Since you likely aren’t a gemologist, you will be guessing as to size, color, and quality of the stones mounted in that ring, broach or necklace. Even if the piece comes with an appraisal, be skeptical. These can be easily made.

The content of the metal mounting is one thing that helps to reassure you of quality. If it is 24 carat gold, there is a much better chance the stones are real, and the same can be said about a platinum mounting. Once you get down to 10 carat gold, these pieces might very well have artificial or semi precious stones.

The rule I use goes like this: I know what the gold or platinum is worth, and usually the offer I make is never more than twice the price I can get for the metal in the mounting. This way, I seldom get hurt, and often I end up with a bargain. Jewelry is one area that you should never feel guilty about your offer. To give you an example of what I'm talking about, I was once offered a tennis bracelet by a woman who showed me the receipt from when she bought it. She paid $3,500. Knowing the gold was worth close to $600, I offered her that, and she accepted it. To this day I don’t know what it’s worth, because I gave it to my wife. However, I do feel safe in saying that at today’s metals prices, I could at least double my money should I decide to sell it.

I’ve previously written a Blog about my friend Warner, who purchased a 24K designer gold watch for $200. One of the reasons he was able to do this was because it didn’t say 24K, but instead had a mark from France that indicated this was 24K gold. Today, this watch might bring as much as $10,000.

My grandfather was originally from Cuba, and when he came to this country he worked for the L & N Railroad all his life. Once when he was traveling though Kentucky, he stopped at our house, and before he left, he handed my mother three large stones that looked like common rocks. He told her they were diamonds. My mother stashed these away in a safe place for many years.

After my Grandfather’s death, my Dad suggested they check out whether or not these rocks were really diamonds. Louisville was the only city large enough to get this information, so off they went.

They shared the story with a store manager in Louisville and asked if they would be willing to cut the largest stone they could from one of the rocks. The store manager agreed to do that, so they left the rocks in his possession and returned home.

They soon received a letter stating that the diamond had been cut, so they returned to Louisville to a very suspicious and inquisitive greeting. Two men started to question my parents about the rocks, but after a lengthy period of time informed them that yes, the rocks were indeed diamonds, probably from Arkansas. The rock they were able to cut turned out to be about the size of a nickel, perhaps larger on its crown.

The manager handed them the bill for the work they’d done and told my folks that if they would allow the shop to keep the cuttings from this rock, they wouldn’t have to pay for the work. Being young and not having to pay out any money sounded like a good idea to them, so a deal was struck. They took their stone and other rocks home.
There is a sad chapter to this story, however. Over the many years and numerous moves, the other two rocks were lost. Boy, would I like to speak to my Grandfather and get the full story about where these stones came from and how they ended up in his possession.

The reason that I share this story with you is to state that everything that sparkles may not be a diamond, but everything that doesn’t sparkle may be a diamond in the rough.

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