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The Importance of Good Jewelry Settings

The Importance of Good Jewelry Settings

One commonly overlooked aspect of jewelry is the quality of the setting and goldwork.  While good jewelry settings are obviously important to the average consumer, they are absolutely vital to the jewelry investor.  High quality jewelry with excellent goldwork can usually be expected to appreciate in value over time.  On the other hand, poor quality jewelry settings make for pieces that are far less desirable, ultimately fit only for scrap.

Now I will readily admit that a lot of jewelry falls between these two extremes, being merely acceptable or mediocre.  However, mediocre isn’t good enough for the jewelry aficionado or investor.  These dedicated collectors want the best of the best.  I suspect many other people aren’t satisfied with mediocre either.

When you finally come across a truly exquisite piece of jewelry, it is almost like a religious experience.  Dripping with gold and precious gems, a handmade piece of elegant jewelry transcends the banality of everyday existence.  It is the stuff of legends and myths.  No wonder people have coveted the very finest jewelry for thousands of years.

But there is a catch.  Really high quality jewelry is incredibly uncommon.  More specifically, jewelry settings with high quality goldwork are unusual.  Most jewelry mountings come from giant factories today, many of which are located in China.  You can imagine the kind of quality you can usually expect from these sources.

Of course not all factory supplied jewelry settings are bad.  That would be an oversimplification.  But the very best jewelry settings tend to be handmade.  Hand fabrication allows for an attention to detail and a flexibility that elevates jewelry-making from a simple vocation to a superb art form.

In today’s world, it only tends to be expensive designer or artisan pieces that are hand fabricated.  However, many decades ago, even relatively modest pieces of antique jewelry were often partially hand fabricated by a jewelry master.  This old world craftsmanship is another unfortunate casualty of the modern age.

The first thing to avoid in jewelry settings is porosity or pitting.  These manifest as tiny bubbles or holes in the precious metal.  In addition to being unsightly, they also weaken a piece of jewelry, making it more likely to break during normal use.  Porosity is most commonly found in cast pieces.  Incidentally, porosity is the reason you should never buy “recycled” or “green” jewelry that comes from broken or scrap jewelry.  Jewelry scrap can contain significant quantities of solder and other impurities, often leading to poor casting results.

A good jewelry setting will also have no excess or messy solder visible on the back of the piece.  In fact, if used properly, it is almost impossible to tell that solder has been used to join two elements in a piece of jewelry.  But hack goldsmiths will leave sloppy joints with blobs of extra solder due to their lack of skill.  In addition, some poorly trained goldsmiths will use under-karated solder because it has a lower melting point than fully-karated solder, thus making it easier to work with.

The next checklist item to watch out for is irregular or bulky prongs.  These are a surefire indicator that your jewelry was made by a rushed, careless or bad goldsmith.  Bulky prongs will cover far too much of a mounted gem, reducing its brilliance and beauty considerably.  Irregular prongs will also give a piece of jewelry an unattractive, asymmetrical appearance.

Roughly or poorly finished jewelry settings are almost as bad as irregular or bulky prongs.  This is best assessed by looking at the back or other hidden portions of a piece of jewelry.  Lazy jewelers or goldsmiths will leave these concealed areas of jewelry rough and coarse because they aren’t typically visible when the item is worn.  However, a rough finish can easily get caught on clothing and is a universal sign of poor quality jewelry.

In contrast, thoughtfully and skillfully constructed designer or artisan jewelry will have excellent finishes everywhere.  Even the back of these high quality settings will be superbly finished.  Investment worthy jewelry often looks just as good on its back as it does on its front.

Finally, good jewelry settings will exhibit balanced lines, interesting contrasts and appealing forms.  While this takes some experience to easily spot, it is obvious once you’ve developed an eye for it.  In comparison, cheap or mass produced jewelry settings will feature derivative, boring or awkward forms.  They will also tend to have bulbous or otherwise unattractive lines.

While many people believe the purity of the gold in fine jewelry drives its value, this is rarely the case.  Once a piece is 14 karat (58.3%) gold or better, purity is largely irrelevant.  Instead, the skill and care that went into the creation of a piece of jewelry is much more important.  Truly fine jewelry settings combine beauty and rarity into an irresistible package.  They are the bedrock of any investment grade piece of jewelry.

My Investing Mistakes – Antiques That Got Away

My Investing Mistakes - Antiques That Got Away

This is a rather painful article for me to write.  I’m going to detail some of my biggest tangible investing mistakes.  These were really great antiques I passed on that, in retrospect, I should have purchased.

My investing mistakes usually had one thing in common: they seemed expensive at the time.  Of course, these lost opportunities would all be hideously more expensive today, assuming I could even find items of equal quality.  So, without further regret, let’s examine some of my greatest failures as an antique investor.

In 2005, a long-time jeweler in downtown Boston was liquidating his shop and going out of business.  So one Saturday, I confidently strode in armed with a loop and an untapped credit card.  I looked through tray after tray of jewelry, but didn’t find anything appealing.  Then I saw it.  A gigantic, unmounted, old mine cut diamond sparkled seductively from a display case.  I asked the salesman to pull the diamond for me so I could examine it more closely.

It was truly a gem.  The stone was huge – approximately 4.5 carats.  And with the exception of its somewhat yellowish tone, which is the norm for old mine and old European cut diamonds, the stone was otherwise excellent.  The cut was well executed and the gem was only moderately included (flawed).

The allure and sparkle of a fine old mine cut diamond is difficult to convey unless you’ve seen one in person.  In these Victorian era cuts, brilliance – pinpricks of white light – are minimized.  Instead, fire – rainbow colored flashes of light – are emphasized above all else.  And the slight yellow tint of old mine cut diamonds lends them a charming, warm character that is unmistakably alluring.

The stone in front of me was a monster, not only in terms of size, also in the intensity of its dazzling fire.  The salesman was determined to sell the gem.  I was lukewarm.  He wanted $3,500 for it.  I told him no.  He offered it for $3,000.  I said I didn’t want to spend that much.  Clearly desperate, he finally said he would let it go for only $2,700 and swallow the sales tax too!  I vacillated.  I really hadn’t intended to spend so much money that particular day.

I pushed for $2,500, but the salesman held firm.  In the end I passed, mostly because I felt the stone’s color was a little too poor.  I feared it would turn into a white elephant – a showy, expensive item that can’t be easily resold because of one, major flaw.  It was one of the stupidest investing mistakes I ever made in my life.

Demand for quality old cut diamonds has skyrocketed over the past decade.  The stone that the salesman practically begged me to buy for $2,700 in 2005 would probably sell for at least $10,000 in 2017, if not more.  That works out to an annualized return of about 11.53% over the last 12 years.  And that is assuming a conservative wholesale price.  If you wanted to buy it from a jeweler or other retailer it would probably be $25,000 or more.  I still have nightmares about passing up that diamond.

And yet that was only one of many stupid investing mistakes I’ve made with antiques over the years.  Another incident occurred in 2003 when I was perusing the inventory of a Boston area antiques dealer that specialized in estate jewelry.  This gentleman had a platinum, sapphire and diamond Art Deco brooch for sale that instantly piqued my interest.

This beautiful piece was clearly all original, without any modifications or repairs.  The finely wrought platinum setting was indicative of a very high quality piece of jewelry.  The mounted stones did not disappoint either.  Although liberally sprinkled with small, single-cut diamonds, the real star of the show was the gigantic, deep blue sapphire set in the middle of the brooch.

This was simply one of the finest sapphires I had ever seen.  And it was completely natural as well.  Under the loupe you could faintly see distinctive, hexagonal color banding, a sure sign of a natural stone in the context of a 1920s piece.  This was no synthetic, but a completely natural, untreated sapphire.  And the color was phenomenal – an intense, vivid royal blue that only occurs in the very finest sapphires.  Of course the stone was large.  By my estimate it was at least 1.8 carats and may very well have tipped the scales at over 2 carats.

The dealer wanted $1,200 for the piece.  I countered with an offer of $1,100 in cash.  He knew exactly how nice the item he had was and promptly turned down my offer.  I walked away, ensuring this experience took a hallowed position in my pantheon of antique investing mistakes.  I shouldn’t have walked away.  I should have just paid him the extra $100 and exited the shop with my new treasure while thanking God for my good fortune.

But the economy was bad at the time and I was doing contract work.  I didn’t feel comfortable paying full price.  I really, really should have though.  Years later in 2010, the price of good quality blue sapphires jumped by about 50% practically overnight.  The central sapphire from that brooch would be worth around $5,000 in 2017 by itself.  That $1,200 investment grade brooch would probably wholesale for maybe $7,000 or $8,000 today.  That represents a 13.42% annualized rate of return!

I hope that my investing mistakes can be a learning experience for you.  I knew that the superlative pieces I passed over were incredibly high quality.  I simply couldn’t bring myself to pay the extra $100, $200 or $300 that the seller wanted for them.  That tiny, additional premium simply seemed exorbitant at the time.

I could not have been more wrong.  The very best investment grade art and antiques often trade at premium prices.  Take my word for it.  Save yourself some heartache and pay the nice dealer his extra $100.  It will be well worth it in the long run.

In Praise of Amber – The Gold of the North

In Praise of Amber - The Gold of the North

Before there was Lucite, Plexiglas, Bakelite or Celluloid, there was amber.  In many ways it is the original thermoplastic – nature’s precursor to the age of modern luxury materials.  Every synthetic plastic that mankind has developed since has been a poor attempt to rival the natural, honey-colored perfection of amber.

And oh, what a plastic amber is.  The golden-yellow gemstone is warm to the touch and extraordinarily light.  With a specific gravity of only 1.05 to 1.09, it is hardly denser than water.  In contrast, most other gemstones – although glittering and beautiful – can seem cold and aloof.  But this is not so with amber.  Instead, it has an inner glow that reflects the best emotional qualities of humanity – welcoming, cheerful and warmhearted.  Perhaps that is why it has so fascinated people across the ages.

Amber typically ranges in color from a light lemon-yellow to a vibrant honey-gold to a deep, reddish black.  The most prized colors for gem quality pieces are a bright, golden yellow or an intense, cherry red.  But a very rare blue variety of the gem found in the Dominican Republic is also quite desirable.  Amber can be opaque, translucent or perfectly transparent, depending on the distribution and number of tiny air bubbles in the stone.

While often referred to as fossilized, amber is technically the partially oxidized, polymerized resin of certain species of ancient, extinct trees.  This treasured, organic gem can range from 2.5 million years old to an almost unimaginable 320 million years old.  However, most gem quality material is usually 25 to 40 million years old.  Due to its sticky origins as ancient tree resin, it also isn’t uncommon to find small insects, plants and even tiny animals, like lizards, frogs or snails, perfectly preserved in amber nodules.

This amazing phenomenon gives scientists and collectors alike an unprecedented window back in time tens of millions of year.  These unbelievably detailed fossils trapped in transparent gold burst into popular culture during the 1990s with the debut of the movie Jurassic Park.  The movie, adapted from the book of the same name by bestselling author Michael Crichton, depicts the cloning of dinosaurs from DNA derived from mosquito fossils trapped in amber.

The warm, golden hue of this organic gemstone has been coveted by man for thousands of years.  In fact, amber has been excavated from northern European archeological sites that are over 10,000 years old.  Its most important historical source in ancient and medieval times was the south Baltic coast, on the shores of present day Poland, Russia, Estonia, Latvia and Lithuania.  Because of this, amber has traditionally been known as the “Gold of the North”.

Demand for the glowing gem was so high in the ancient Roman Empire that an extensive trade network developed to move large quantities of the Gold of the North from the Baltic region to the Mediterranean Basin.  Due to its distant source, many myths surrounding the precious golden gem and its origins sprang up in the ancient world.  For example, some ancient Greeks romantically believed that amber was the liquid rays of the setting sun, condensed into a perfect, golden gem.

Amber was also considered a gem with powerful magical properties in ancient times.  This was at least partially attributable to its propensity to easily acquire a static charge, causing it to attract small fibers of cloth or shreds of paper.  In fact, our modern word for electricity is derived from the ancient Greek term for amber – “elektron”.

The Gold of the North continued to be highly prized by the wealthy and powerful throughout the medieval period.  By the 13th century, the crusading Teutonic Order, having captured much of the Baltic region from its pagan inhabitants, promptly enforced a total monopoly on its trade.  The late medieval demand for rosary beads coupled with the Teutonic Order’s monopoly on amber production helped make the Baltic region fabulously wealthy during this time.

European craftsmen in the countries surrounding the Baltic coast became experts at working the treasured material.  The greatest of their creations was undoubtedly the Amber Room.  As the name implies, this was an entire chamber of sumptuously carved amber panels backed with mirrors and gold leaf to increase their reflectivity.  This magnum opus was created from over 13,000 pounds (6 metric tons) of the finest Baltic amber by the master craftsman of the Danish court, Gottfried Wolfram, and two additional master carvers from the city of Danzig, in the Kingdom of Poland.

Although originally commissioned in 1701 by Frederick I of Prussia for his wife, Sophie Charlotte, the Amber Room was given to Russia’s Peter the Great in 1716 as a gift to seal an alliance.  For centuries this masterpiece was widely considered the Eighth Wonder of the World until it was looted from the Soviet Union by the Nazis during World War II.  Tragically, the Amber Room was either destroyed or lost in the German city of Konigsberg (the modern Russian city of Kaliningrad) at the end of the war in early 1945.

Amber is truly an amazing substance.  At once lustrous and mellow, it radiates an inviting warmth absent from other, inorganic gemstones.  Is it any wonder that man has cherished the soft glow of the Gold of the North since he first discovered it upon the shores of the Baltic Sea so many millennia ago?

Etsy and Investing in Contemporary Jewelry

Etsy and Investing in Contemporary Jewelry

I was looking at Etsy recently for interesting investment grade contemporary jewelry.  Etsy, if you aren’t already familiar with it, is an online Indie craft-oriented sales platform.  As usual, most of the pieces I encountered might have been fine as fashion jewelry, but most definitely did not merit investment grade status.  Unfortunately, determining if a specimen of jewelry is investment grade can be a bit of an art form in itself.  To paraphrase a former U.S. Supreme Court justice, identifying investment grade contemporary jewelry is a lot like pornography; I know it when I see it.

In any case, I found a few desirable examples swimming in a sea of mediocrity.  This is actually not an unusual state of affairs.  Truly fine, investment grade contemporary jewelry is fabricated from the best quality materials into an artistically compelling design.  This is harder to do than it might seem at first – actually an awful lot harder to do than it seems.

For one thing, most jewelers pursuing artistic pieces work on spec – meaning they create the jewelry without having a buyer first.  They bear the cost of paying for all the materials upfront.  And they must dedicate substantial design and fabrication time without any assurance that a buyer will eventually materialize.

This is one of the reasons artists – jewelers included – are often starving.  It is also one of the reasons a lot of jewelers create their more experimental works out of silver, quartz and other relatively low value materials.  If they misjudge customer demand and make an unsalable piece, at least they’ve only wasted some time instead of valuable materials as well.  Unfortunately, the use of low priced materials tends to disqualify jewelry from investment grade status – although this rule of thumb is not absolute.

It is much safer for an artistically minded jeweler to take work on commission – meaning finding a client first and having him pay either part of or the entire fee upfront.  This removes most or all of the risk associated with working on spec.  But commission work is difficult to get unless an artist has already cultivated a client base over many years.  And developing a client base only happens after first creating captivating or intriguing jewelry – you guessed it – on spec.  It can be a discouraging catch 22 situation.

A few daring jewelers just don’t care though.  They will sink copious amounts of time and money into daring and evocative pieces with no potential buyer lined up – profits be damned.  These are the sorts of works I am constantly searching for on sites like Etsy.  But, as I stated before, they aren’t easy to find.

Artists looking to create the very finest contemporary jewelry face other challenges as well.  If you’ve ever spoken to artists about the creative process, they will usually admit that it can vacillate wildly between being joyfully easy at some times and frustratingly difficult at others.  And, of course, there is no guarantee that the product of their artistic endeavors will be good, even if the process is relatively painless.  So there is always an element of chance in creating a great work of jewelry.  This is the reason nearly every artist will regularly abandon works throughout his career before they are fully completed.  Sometimes you just can’t save a doomed piece, no matter how much you try.

But when everything goes right – when all the unpredictable stars in the creative process align – a jewelry artist can create a truly magical, special piece.  These masterpieces are physical manifestations of the genius of the creative mind.  They represent the apogee of human culture distilled into a single, small glittering object.  They are miniature works of art expressed through the coveted medium of colorful gemstones and precious metals.

The difficulty of investing in contemporary jewelry is often underestimated.  Let me share some shocking Etsy statistics that underscores this point.  Right now there are almost 7 million pieces of contemporary jewelry on Etsy that are categorized as “handmade”.  However, according to my best conservative estimate, only about 2,000 of these pieces are definitively investment grade.  Perhaps another 4,000 to 6,000 pieces are borderline in nature, straddling the edge of investment grade status.  If you add up all the possible investment grade contemporary jewelry on Etsy it amounts to no more than 8,000 pieces in total.  This represents less than 0.12% of all handmade jewelry on Etsy, using extremely generous assumptions!

If we assume that the average price of a piece of contemporary, investment grade jewelry on Etsy is $2,000, we can infer that there is somewhere between $4 million and $16 million worth of them available on the platform as of early 2017.  Ten million dollars might seem like a lot of money.  And for most of us ten million dollars is a lot of money.  But if institutional money management companies ever figure out how rare, special and desirable investment grade contemporary jewelry is, it would sell fast.  A medium sized hedge fund could easily purchase every investment grade piece currently listed on Etsy in a busy afternoon and the total cost would be a rounding error on their balance sheet!