IDEX Online / UBS Diamond Series: Spaghetti Charting
While rough supplies decreased, polished diamond stocks in the pipeline increased, he stated. Even-Zohar called his presentation Frequent Flyer Club of Rough Diamonds, to illustrate the indirect route rough diamonds make from the mines to the manufacturing plants.
As an example, he noted that while the leading source of rough came to Israel from Europe (where DTC Sights are held), the second leading source (14.1 percent) was from Switzerland “and its many diamonds mines,” he joked. “Corrupt officials in Africa offer dealers to declare a low value on the goods and split the savings on export taxes between them,” Even-Zohar explained.
The goods are then exported to Switzerland and Dubai that have no export taxes. From there they are exported with their real value to the cutting centers. He told listeners that De Beers MD Gareth Penny called the long and twisted pipeline the Spaghetti Chart.
Raising the hot topic of the GIA ‘Certifigate’ scandal of grading certificate upgrades, he asked the crowd how they felt about the fact it was discussed publicly, warning them that eventually the general public will become aware of it.
The crowd of some 100 listeners, which expressed support for continued exposures of the issue, was interested in hearing more details about it.
UBS analyst Uri Krausz discussed the bank’s situation in light of the recent changes in the global economy, reassuring the listeners that it was among the most stable banks in the world.
Krausz introduced a number of financial products the bank is currently offering, including structured products backed by food commodities, adding that the bank estimates the U.S. dollar to close 2008 at $1.50-$1.45.