How is gold superior to diamonds really? Both are stores of value, but their value based only on others' willingness to trade for them. No real intrinsic value. Granted a fiat dollar is less reliable as there is truly a limited supply of the metals, but that's true of diamonds as well.

I would think Gold jewelery is superior to a gold bar - it has decorative utility a gold bar doesn't have - but look at how gold jewelery is valued - at the current gold price and no more.

> How is gold superior to diamonds really?

Copied from an article [1] on why diamonds aren't worth the cost:

  A diamond is a depreciating asset masquerading as an investment. There is a
  common misconception that jewelry and precious metals are assets that can store
  value, appreciate, and hedge against inflation. That’s not wholly untrue.

  Gold and silver are commodities that can be purchased on financial markets. They
  can appreciate and hold value in times of inflation. You can even hoard gold
  under your bed and buy gold coins and bullion (albeit at a ~10% premium to
  market rates). If you want to hoard gold jewelry however, there is  typically a
  100-400% retail markup so that’s probably not a wise investment. 

  But with that caveat in mind, the market for gold is fairly liquid and gold is
  fungible - you can trade one large piece of gold for ten smalls ones like you can a ten
  dollar bill for a ten one dollar bills. These characteristics make it a feasible
  potential investment.

  Diamonds, however, are not an investment. The market for them is neither liquid
  nor are they fungible.

Also, despite thousands of years of attempted alchemy, no one has ever made gold. Carbon, on the other hand, is incredibly common and there are companies that have figured out how to make diamonds that are more flawless than naturally occurring diamonds. They've even figured out how to mimic the impurities after it was suggested that they were somehow not "real."

[1] http://priceonomics.com/post/45768546804/diamonds-are-bullsh...

> How is gold superior to diamonds really? Both are stores of value, but their value based only on others' willingness to trade for them.

Because gold is (relatively) easy to sell but "Selling individual diamonds at a profit, even those held over long periods of time, can be surprisingly difficult"[1]

[1] http://www.theatlantic.com/past/issues/82feb/8202diamond2.ht...

> No real intrinsic value.

Not necessarily true. Gold is an excellent conductor of electricity and resists oxidation. Diamonds are good at cutting stone and concrete.

Can a diamond be sold for what one paid for it? Gold has no concept of retail price as it's a commodity.

If that was the justification, people would be giving gold bars, not gold jewelry.

I'm from India and let me tell you that gold jewellery is primarily viewed as a store of value and not as a romantic gesture.

Buying gold is the main way that Indians save.

I initially came here to disagree. My argument was that if someone was going to give something "pretty and shiny" to someone, at least gold holds its value second hand over diamonds. However, I think of the Cash4Gold type scams out there and cant help but think that selling jewelry of any type second hand is going to get you screwed.

Who says there's a single justification? And how would you carry a gold bar about on your person? Part of the security of gold jewelry is arguably that you will have it with you in an emergency, or if you have to flee quickly. The gold bars sitting in your vault will be much harder to access quickly.

Depending on the legal system that one finds oneself subject to, jewelry is often considered a "personal effect" rather than an asset to be seized, such as gold bars, coins, or currency - and is therefore not subject to forfeiture.