National Jeweler reports that affluent households in the United States spent $16 billion on jewelry in the past 12 months. These findings, which are derived from the 2009 Mendelsohn Affluent Survey, indicate that affluent Americans are not bothered by the financial crisis, or at least, not as bother as they were in January.

The survey reveals that 31% of affluent households purchased fine jewelry, in addition to 46% of the upper echelon who didn't let the global downturn get them down. The survey was conducted among 13,275 households with an annual income of $100,000 and above.

Overall, it was concluded that 15.1 million affluent Americans have spent $21 billion on fine jewelry and watches, while some 0.5 million are preparing to purchase engagement rings in the upcoming year. Most of the participants in the survey are described as "wealthy policy makers", the kind of people who purchase luxury brand jewelry and are determined to keep up with the latest trends in the field no matter what.

The optimistic data supports a consumer behavior study performed by Wells Fargo & Co among 1,600 households in the US. The study shows that despite the financial uncertainty, over a third of the households in the United States haven't changed their consumption habits.

It seems that fear is not enough to generate a real change in the American market. The survey reveals that younger households (18-41) have made the smallest changes compared to older households. No less than 60% of younger households reported a failure to change their consumption policy compared to 27% of the older households that reported an inability to change.

Why is there no change? The reasons vary from "no desire to change" (2%) to "no idea what to change" (10%) and "inability to implement plans for improving consumption behavior" (22%). The main reason for the lack of change was "the feeling that a change in consumption habits will not have a significant effect on the financial situation (24%). The study further indicates that spending on entertainment and vacations was cut by half compared to last year, and that most Americans are now comparing prices before they buy anything. Another data indicates that 37% of the surveyed only buy what they need.

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Earlier this month, Israel Minister of Industry, Trade and Labor Binyamin Ben Eliezer announced that his ministry will act to support the Israeli Diamond Industry. With the global financial crisis still at large, unemployment is high, and the diamond industry is low on “Excellent” diamond polishers. The solution is simple: the ministry would help finance professional training programs for diamond polishers.

The Israeli Diamond Industry, which has been deeply affected by the crisis, is expected to see an increase of hundreds of millions of dollars in local production of polished diamonds, and the 100 people who undergo the training will be hired by local manufacturers.

The Israeli Diamond Industry is doing everything in its power to pull through the crisis, as evident from our Together Works program. Other governments around the world are also trying their best to help their diamond industries.

The government of Russia, for example, has pledged to invest some $1 billion in diamonds produced by Russian diamond giant Alrosa. I can't imagine what Russia Prime Minister Vladimir Putin is planning on doing with $1 billion worth of diamonds, but it is nonetheless quite a noble gesture.

In India, the government has launched a new scheme to support the diamond and jewelry industry, which includes subsidized loans, support of safety measures and protection from occupational hazards, and the establishment of an institute for the development of gemstones and jewelry.

Meanwhile, Ontario launched diamond drilling training programs in two colleges in Northern Ontario. This is just one expression of Canada's Economic Action Plan, which includes a C$12 billion investment in infrastructures, some of which directed at the diamond mining industry.

Sierra Leone, which relies heavily on the export of diamonds, recently decided to lower the commissions for the export of diamonds and gold, in an attempt to encourage more mining companies to operate in its territory.

And finally, last month the Thailand government canceled the 7% value-added tax on the import of raw materials for the Thailand jewelry industry. This tax exemption will be valid until December 2011, by which time, hopefully, the global financial crisis will be over.

It's difficult to say that things are looking bright, but they are definitely looking brighter. The governments of the world continue to provide well needed and deserved support to the diamond industry, and hopefully, we will all soon pull through it together.

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Is the diamond industry truly collapsing? While the burden of the financial crisis is starting fade, although not truly behind us just yet, it seems that the diamond industry is still struggling to make do.

Diamond sales worldwide are plunging drastically, as indicated in De Beers' unprecedented drop of 99% in net profit during the first half of 2009. Namdeb, Namibia's biggest diamond producer, which reported a production of 2.1 million carat in 2008 and sales 24% higher than in 2007, foresees major challenges in 2009, and expects sales to drop 50%. The company, which is one of De Beers ' ventures, has also temporarily halted production in early-April, due to the drop in demand.

Although De Beers believes it can get back on track by performing massive layoffs and executing a reorganization plan, one has to wonder whether this is enough. The world is changing; even the diamond giant itself admits that the jobs it has eliminated due to the crisis will not be recreated once the crisis is over.

Meanwhile, Anglo American, which holds 45% of De Beers, has refused a merger proposal by its rival, Xstrata, insisting on staying independent. Such a merger would save up to $1 billion a year, Xstrata claims, but Anglo American believes it can survive on its own. Only problem is, now it has to prove it, and with weak results like De Beer's, it seems unlikely.

On the other hand, Russian diamond giant Alrosa recently declared its plan to sell $2 billion worth of diamonds in 2009. That is an admirable plan, but to whom is the company planning on selling the diamonds?

"A Diamond is forever", states the 60-year-old De Beers slogan, but empires come and go. If Anglo American eventually does succumb to Xstrata's merger, it could lead to an overhaul change in the diamond industry, and might finally take one of the major diamond company out of the picture, or at least change its status. If successful, it might lead other diamond giants to change their course and conform to mergers of their own, for example, the highly anticipated merger between Rio Tinto and BHP Billiton.

Perhaps the answer doesn't necessarily lie in the concept of mergers, but either way, cooperation between the different diamond groups is required. Heads of the industry, mainly De Beers, Rio Tinto, BHP, Alrosa and Harry Winston, realized this months ago when they decided to form the International Diamond Board, which is aimed at promoting diamonds and diamond jewelry in the consumer markets.

One thing is certain – diamonds need to make a comeback. Hopefully, it won't be long before the world's rich come out of their hiding and start buying luxury items again. The industry should also consider investing in more ordinary folks and coming up with creative ways to reach this population.

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