DIAMONDS COMMERCIALLY 35
to pay as much for stones as they were selling them for at retail; in some cases more.
As
the retailer does not usually turn his stock of diamonds more than
once a year, his profits are, comparatively, less than most staples
which are turned more frequently at a smaller profit, and they are
actually less than the percentage of profit afforded by many of the
necessities, as shoes, scarves, and clothing both for male and female
wear, and a large number of foodstuffs.
In
ordinary times the diamond trade is not a money-making business. The
volume of sales, compared with the stock necessary to do the business,
entails an interest account which eats up a large part of the profits.
Panics usually find the dealer with a large stock on hand, and notes
out for a considerable part of it. As a result, much of the money made
during the flush period preceding, melts away before all the notes are
paid.
Good-sized
fortunes have been made in the States out of diamonds, usually by
shrewd importers who have been able to extend large credits to jobbers
and retailers who were better able to market the goods than to finance
their affairs without the assistance of the firms from whom they bought
their stocks. In carrying such accounts, the importer not only makes
larger profits, but a constant income from renewals of notes, as he can
generally borrow for one or two per cent, less than the six per cent,
he charges. The method is about as follows: the importer noting a
wholesale or retail jeweler of moderate capital who is doing a good
business and whose character is good, approaches him with an offer of
large credit and long time, payment to be made by notes, but
