Diamonds Are Forever

The gem traders of West 47th Street maintain a timeless world

Just before 9 a.m., a dusty yellow bus pulls up to a corner in midtown Manhattan and lets out a dozen black-coated, bearded Hasidic Jews from Brooklyn. Others, similarly dressed, come pouring out of the subway entrance. Swiftly, the narrow, dirty street begins its daily transformation. Pale hands splay rainbows of gems across velvet cloths in store windows, magically making each an entrance to Ali Baba's cave. This is West 47th Street, a tiny world of its own that handles about half of the diamonds entering the U.S. Here brokers play middleman between American buyers and the supplying De Beers syndicate in London, and the deals amount to more than $2.5 billion worth of rare gems a year.

No one is sure of the exact figure because of the legendary secretiveness of the diamond trade. But business is obviously booming. In the past five years, prices have quintupled, and the working population of the street has more than doubled, reaching about 15,000.

Inevitably, such growth in an area dealing in such a precious commodity is accompanied by friction and occasional sparks of violence. Earlier this month, Martin Paretsky, 71, left the street with $500,000 in diamonds, heading for a meeting at the nearby Hilton Hotel. No trace of him has been found. Two days later, Satya Narian Gupta, 27, one of the handful of Indian dealers on the street, left his office with $300,000 worth of stones. Three days later, his body was found bound and strangled in Pennsylvania's Pocono Mountains. There have been no arrests in the case. The well-publicized incidents have made the merchants even more tight-lipped than usual. They fear that any talk with outsiders could lead only to greater vulnerability.

The insularity of West 47th Street stems from the homogeneity of the diamond dealers. The vast majority are Jewish. Until the end of World War II, there were only a couple of diamond shops in the 47th Street area. Then came the influx of survivors from the Nazi Holocaust, many bearing the tattoos of their concentration camps. The newcomers entered a business that had been a specialty of Jews since the Middle Ages, when the trade was one of the few professions that did not come under the purview of a tightly controlled guild. Diamonds were also perfect wares for a persecuted and wandering people who had to carry their means of livelihood with them.

Almost a third of the workers on 47th Street are Hasidic Jews, a Yiddish-speaking, fundamentalist sect. The men let their beards and forelocks grow, as admonished by the Old Testament book of Leviticus. Deeply religious, the Hasidim from Brooklyn travel in a bus that is divided down the aisle by a curtain, segregating men and women for prayer sessions on the way to work.

The high value the Hasidim place on personal honor sets the tone for the street, where packets of diamonds worth hundreds of thousands of dollars are traded by verbal agreements. Says one dealer: "If I broke my word in a deal, the word would be passed, and I would be dead in the business. No one would talk to me. I would be shunned."

The hub of the street's activity is the Diamond Dealers Club, which is on the ninth floor of one of the street's newer buildings. The club has 1,750 members, who are among the most respected and established dealers on the street. Election to the club is restricted, coming only after a person has secured a reputation and been fully scrutinized by club members.

Packets of diamonds in the rough, as well as polished stones cut by the street's manufacturers, are traded in the club's nondescript 200-ft. by 200-ft. room. Reports TIME'S John Tompkins: "You get into an elevator with a crowd of Hasidim and feel them staring, wondering who you are. All the brokers know each other by sight, if not by name. A set of electrically operated bulletproof glass doors leads to the room's lobby, and another automatic door, with the legend NO VISITORS ALLOWED, and operated by a guard, leads to the trading floor. As in every store and office in the area, there are plenty of closed-circuit cameras and hidden alarm switches. The windows are high, and there are dozens of 20-ft.-long tables, lit by fluorescent study lamps, where diamonds are inspected and traded."

A broker with a diamond to sell produces a small paper packet from a leather pouch. The method of folding the paper, white on the outside and pale blue on the inside, has been in use for generations, here and in Europe. For 25-c-, the diamonds are weighed on one of the room's electronic scales, and the result written on the packet. The seller has told the broker what price he wants, and the broker wanders the room soliciting bids. When he gets a good offer, he "seals" the packet, which pledges that he will talk to no more potential buyers until he presents the offer to the seller. If the deal is closed, the broker says "Mazel" (luck in Hebrew) and the buyer replies "Mazel un brucha" (luck and blessing), a ritual used around the world, whatever the ethnic background of the participants.

Deals are also made inside the street's ground-floor stores, many of which are actually indoor public markets, where merchants can rent booths for prices of up to $2,500 a month. Unlike the hushed elegance of a room at Tiffany's a few blocks away, the market is a bustle of good-natured haggling, questioning and exhorting in many languages.

The trading also involves flocks of individual entrepreneurs, who often make their main living by cutting stones for manufacturers. A typical diamond cutter last week sat in his office, high above 47th Street, and dealt with an elderly broker standing before him. The cutter examined a packet of raw stones with his loupe. He shook his head, wrapped the packet up and handed it back to the broker. The old man wearily placed it in his old leather pouch, held together with tape and rubber bands, and produced another packet. The two haggled for a moment in Yiddish and then the second packet was also rejected. That day there would be no sale between the broker, who carried the diamonds around on consignment, and the cutter. The visitor took his worn pouch, holding stones worth thousands of dollars, and concealed it in an inside pocket of his coat. Then he headed off to another shop.

Casual dealings like these would seem to make the area ripe for robberies. It is hard to say how much is stolen per year--$1.1 million worth of diamonds was reported taken during the first 2 1/2 months of 1979--because the dealers shy away from police. Says Lieut. Edward O'Connor, commander of the Manhattan robbery squad and a former detective in the diamond district: "It's a very clandestine business. Very few people will cooperate or tell you anything."

Justice is something the community prefers to handle itself. Disputes are arbitrated by a panel of the Diamond Dealers Club composed of three or more men whose logic has been sharpened by intense study of the Talmud, the volumes of Jewish law. The decisions of these scholars, who act like the Jewish religious courts that existed in Europe hundreds of years ago, are law to those in the diamond trade.

One growing problem on the street is that the traditional codes revered by the Hasidim are not as deeply ingrained in what they refer to as the street's "new element." There has been an influx of younger, Middle Eastern Jews into the trade. Says one oldtime cutter: "They are aggressive, irresponsible, not steeped in tradition." Broker Pinchos Jaroslawicz, 25, made the mistake of trusting one of these new diamond workers, a young Israeli named Shlomo Tal. Jaroslawicz took along his pouch of diamonds one day in September 1977, when he went to call on Tal. The young Israeli and an accomplice were found guilty of murdering and robbing the broker and stuffing his body, wrapped in plastic, into a wooden box in Tal's office.

Despite the problems, the street is resisting change, reluctant to move away from dealing in nods and trust and credit. On a sunny spring day, small groups of Hasidim, shaded by their wide-brimmed hats, stand on the sidewalk in front of the delis, speaking Yiddish, holding diamonds up for study and striking deals. Antwerp must have had similar scenes in 1608, when there were 104 Jewish diamond cutters in the city. On 47th Street, the old ways are still the best. They always have been in the diamond business.

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