China Contagion: Diamonds & Wine Plunge To 4-Year Lows
As classic Ferraris break records on the shores at Pebble Beach, the "poor" rich-man's (and girl's) best friend (fine-wine and diamonds) has tumbled to 4-year lows. On the heels of a crackdown on corruption in China, as Bloomberg notes, Fine Wine prices have plunged over 30% from July 2011 highs and the end of the "show-off" era in Xi's new normal has sent 1 carat dimaond prices also down over 30% from their highs. It would appear the world's wealthiest are done with such small increments of wealth as fine wines and diamonds, preferring $100 million apartments and $38 million ferraris.
As Bloomberg concludes,
Wang said China’s wealthy are being less ostentatious not only in their choice of ornaments. Bans or limits on official banquets and gift-giving have forced premium wine brands to “re-adjust their positioning and present more middle-end products with lower prices,” he said.
China last year passed France as the largest consumer of red wine, Les Echos reported in January. Under Xi’s anti-corruption campaign, the Central Commission for Discipline Inspection can detain indefinitely and investigate any of China’s roughly 87 million Communist Party members.
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