Diamonds: Articles of Interest #11

Episode Summary

Title: Articles of Interest #11 Summary: The episode discusses the history and cultural significance of diamond engagement rings. It explains how diamonds used to be extremely rare and only affordable by royalty until large deposits were discovered in South Africa in the late 19th century. The De Beers company then acquired most of the world's supply of diamonds and launched advertising campaigns in the 1940s promoting diamond engagement rings as a cultural norm. This marketing ploy was highly successful in making diamonds seem rare and essential for proposals, despite their abundance. The perceived value and ethics of the diamond industry have been questioned over concerns like conflict diamonds funding wars, poor mining conditions, and environmental damage. Lab-grown diamonds emerged as an affordable, ethical alternative, but they are still distinguished from "real" mined diamonds. Though they are chemically identical, mined diamonds command higher prices based on the perception of authenticity and value constructed by the industry. Ultimately, diamonds are valued for their symbolic meaning more than monetary worth or aesthetics. The tradition persists because diamonds represent commitment, love, and values within relationships. Even when the history is tangled, diamonds hold sentimental significance passed down through generations.

Episode Show Notes

Diamonds represent value, in all its multiple meanings: values, as in ethics, and value as in actual price. But what are these rocks actually worth?

Episode Transcript

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SPEAKER_02: We're sitting at the bar and we got a couple drinks and we were kind of just killing time before our flight. I reach into my bag and I pull out this small leather box that I had been holding on to all weekend. And I'm like, will you marry me? Like, I think those are the words that I said. It all was kind of a blur, but inside of the box wasn't a ring. It was a Pokémon game cartridge. SPEAKER_09: Courtney and Sean love Pokémon and they've been wanting to play two versions of it called Ruby and Sapphire. Things that were very special to us. SPEAKER_02: And they're both gemstones. Why not a ring? SPEAKER_02: For a lot of reasons, I was just like, I don't think that a ring is that important. I think that something important to both of us, that'll be really meaningful. But what I didn't realize about my like flawless plan to propose with something more meaningful than a ring was that it's not understood on the surface as a proposal. SPEAKER_09: At first, Sean wasn't sure if Courtney was serious. And I have to admit, when I saw a picture of Sean holding up a Pokémon cartridge with the caption, I said yes, I absolutely thought it was a joke. People were texting us like, are you actually getting married? Is this real or is this like a joke? SPEAKER_02: And I was like, yeah, of course it's real. SPEAKER_09: Real. As real as this 2018 Diamond commercial. I will spend my future with you and I will be honest with you. SPEAKER_05: And it will be wild. It will be kind and it will be real. SPEAKER_09: And as it fades to black, the tagline across the screen reads, real is rare. Real is a diamond. But reality and rarity are subjective. In matters of love, definitely. And certainly in the matter of diamonds. Articles of Interest. A show about what we wear. Season 2. SPEAKER_00: People don't realize it's fantasy. There's always this thing that you have to work extra hard to get. SPEAKER_01: Mmm. That's so good. SPEAKER_00: No one dresses like a king anymore. SPEAKER_11: How do you make money? That's how I make money, love. SPEAKER_08: There are lots of things that we take for granted that would once have been considered luxuries. SPEAKER_09: I'm walking down West 47th Street. I mean, come on, what kind of radio producer would I be if I didn't start a story about diamonds exactly where you'd expect? Manhattan's Diamond District, baby! SPEAKER_00: I am open, miss. Are you shopping or something? SPEAKER_09: Oh, I'm just looking around. I'm just wondering how it varies store to store. Is that really that much of a difference? It's not. Everybody basically has the same freaking thing. SPEAKER_09: Julian is out here in front of his diamond shop just hustling. He's been working this storefront for 20 years. In the Diamond District, it's all a crazy game with everyone just trying to beat each other's prices. Listen, up there I sold for a thousand. Okay, I'll give it to you for $950. SPEAKER_00: $50 is going to make a difference for you? Fine. How are sales? SPEAKER_09: It's a little tough. It's a little tough. SPEAKER_05: We're working on smaller profits than ever before. SPEAKER_09: This new generation of marriage-age people makes diamond sellers nervous. A lot of us millennials are in crippling debt and we're struggling to pay exorbitant rents and we really don't have a couple thousand dollars burning a hole in our pocket that we want to spend on a diamond. Especially given the bad associations they carry. Blood diamonds. No, like really not just in a cartoon evil villain voice. SPEAKER_02: I grew up hearing a lot of the same stories that Courtney did about how the diamond industry is exploitative and horrible. SPEAKER_09: So blood diamonds or conflict diamonds are diamonds that come out of war zones where warring groups have been fighting SPEAKER_11: over the alluvial fields where the diamonds exist in order to raise cash for their effort, which is violent. Rachelle Bergstein is the author of Brilliance and Fire, a biography of diamonds. SPEAKER_11: And then when they were getting the diamonds, they were sending them into the marketplace and diamond companies like De Beers and other traders weren't really asking questions about where they came from. And they could easily have been funding devastation and violence and horrible things and no one was really thinking that much about it. SPEAKER_09: That was until the late 90s when a torrent of news and long-form reporting came out about conflict diamonds and how they were used to fund insurgencies and warlords. And all this attention eventually led to stricter protocols and tighter regulations within the diamond industry. SPEAKER_07: Almost 90 percent of diamond supply is produced by very large corporations and they're very heavily regulated and they're very transparent. SPEAKER_09: That's diamond industry analyst Paul Zimniski. And he says now these big diamond companies are not funding human rights abuses, although there are still conflict diamonds out there. SPEAKER_07: I think it represents a very, very, very small part of supply, but it can create a PR problem for the industry. SPEAKER_09: Listen, I'm not trying to give the diamond industry a pass here. The ethics of diamond mining are complicated. Like, diamond mines might not be funding armies of child soldiers anymore, but in a lot of cases the working conditions are not ideal, especially in countries without a lot of labor oversight like the Democratic Republic of the Congo. I mean, mining is still a hard job. And just creating a mine at all, digging an unfathomably huge crater in the earth, that is environmentally devastating no matter how you slice it. But truly, diamonds aren't that different from other extractive industries. A lot of materials around us have been mined and manufactured in questionable ways and we don't talk about them. Take, for example, cobalt. SPEAKER_07: We use cobalt in Teslas and we use it in our iPhones and, I mean, almost all of that's produced in the Congo and it's the exact same issue that the diamond industry has with diamonds produced in the Congo. Diamonds are held to a different standard. SPEAKER_09: I think people think that a Tesla is providing enough good where even if we're providing some bad by creating demand for cobalt that comes out of the Congo, we'll kind of let that one go. SPEAKER_07: But since we don't need diamonds, there's zero room for any illicit goods. SPEAKER_09: We don't need diamonds, even though it doesn't exactly feel that way. Diamonds are almost culturally mandatory. They've become almost a requirement if you want to get married. Which leads to the other big thing that made Courtney skeptical about diamonds. Maybe you've heard this too. That diamonds are a scam. SPEAKER_02: The sort of bonkers inflation of the worth of a diamond, which is not actually that rare or valuable, but it was just like a gigantic marketing play. Concerns about diamonds are concerns about value in both senses of the word. SPEAKER_09: Values as in ethics and morality and also value in terms of price. So let's talk about what these rocks are actually worth. SPEAKER_11: The diamond industry and one of the things that I found so fascinating about it in my research. Author Rachelle Bergstein again. SPEAKER_09: They're forever walking this tightrope, right? SPEAKER_11: How do you convince people that diamonds are accessible enough that every woman should have one, but also keep them in the public imagination so rare and glamorous and special that you don't ruin it? Right. And that's what they've been working on forever. Diamonds were rare. Once. They were exceedingly rare. SPEAKER_09: In the ancient world, diamonds were something only royalty could afford. And then suddenly in the late 19th century, there was a huge supply of them. Diamonds became an industry when a whole bunch of them were discovered in South Africa on a property owned by brothers Diedrich and Johannes De Beere. They were farmers. Okay, so De Beere's actually had nothing to do with the De Beere's company. SPEAKER_09: A massive diamond deposit was discovered on the De Beere's property, which you'd think would be a blessing, but it was too much of a good thing. The land became overrun with international mining interests and eventually the British government would force the De Beers to sell their property. The De Beers mine turned out to be one of the most productive mines in the area. SPEAKER_09: The De Beers brothers could have never known that their name would get adopted by the foremost diamond company in the world, which was run by a man named Cecil Rhodes. He was a sickly Englishman who followed his brother down to South Africa and down to the Diamond Rush. SPEAKER_11: And there are funny pictures of him where he was like a dandy. Very much in the Beau Brummell way. SPEAKER_09: He's among all of these people digging and covered in dust and carrying buckets and he's like sitting there on an overturned bucket in a white suit looking, you know, glowering. SPEAKER_09: Maybe it looked like he was glowering, but Cecil was scheming on behalf of his motherland. He felt this really strong internal drive to elevate the status of the United Kingdom. SPEAKER_11: He felt like the Queen's special envoy, even though she had not given him this job. Cecil Rhodes is like the archetypal colonizer capitalist. SPEAKER_09: You think of an old timey European guy in a piff helmet dressed from head to toe in khaki with a mustache and a rifle at his hip and that's Cecil Rhodes. He started by buying up all the little mines in South Africa and consolidating them. SPEAKER_11: He grabbed up lands in Africa left and right and colonized. SPEAKER_09: Like in modern Zimbabwe, formerly named Rhodesia after Cecil Rhodes. SPEAKER_11: He created the Rhodes Scholarship to instruct and elevate young men who might follow out his mission as well. SPEAKER_09: Yeah, they should consider changing that name. Cecil Rhodes created a dynasty that grew and grew and grew, eventually buying up all the diamonds coming out of Russia and Australia, until the De Beers company had amassed more diamonds than had ever been thought possible. But come on, Rhodes didn't want the public to know that. SPEAKER_11: He realized that in order to preserve the specialness of the diamond, you had to somehow control the output. You had to find a way to make them feel rare even if they kind of weren't anymore. So did that mean literally stockpiling them somewhere? SPEAKER_09: It did. SPEAKER_09: When jewelers like Tiffany's and Harry Winston and Cartier wanted to buy diamonds, they had to come to De Beers' stockpile in London. Rhodes intentionally limited the supply to jack up the price. But even as he limited the supply at the same time, his company was pushing public demand. SPEAKER_11: They were both a mining company and a marketing company. SPEAKER_09: De Beers wasn't allowed to advertise in the U.S. because they were a monopoly and America enforced antitrust laws back then. But as a workaround, De Beers decided to market the general idea of diamonds. After all, they mined most of the diamonds in the world anyway. If De Beers could get people to buy diamonds from whatever jeweler, they'd still be making money. And so De Beers created the tradition of the diamond engagement ring. Because if you can't sell diamonds for millions of dollars to royalty, you can sell diamonds for thousands of dollars to everyone. De Beers created this idea that every single couple must buy a diamond. Don't get me wrong, wedding rings have been around a very long time. But diamond engagement rings are decidedly 20th century. Is this the very first Diamond Dad? This is the first. Oh my god, it's so verbose. Looks like a page from a book. Okay, this is so funny. SPEAKER_11: These early diamond ads are not what I would call compelling. SPEAKER_09: The beautiful flame of a diamond is unquenchable. SPEAKER_11: However modest, your wife will never relinquish it to meet more affluent circumstances. That's one of my favorite lines. But then in 1948, De Beers launched what is arguably the most successful advertising campaign of the 20th century. SPEAKER_09: Really incredible young copywriter named Frances Garrity. She worked for N.W. Aaronson, the advertising company. SPEAKER_11: And Frances Garrity was given the task of coming up with a tagline for the ads. SPEAKER_09: Legend has it, Frances was really coming down to the wire the night before the tagline was due. She stayed up all night and she couldn't think of anything. SPEAKER_11: And then at 5 a.m. she scribbled out, SPEAKER_09: Uh, diamond is forever. She came into the office and said, here's what I've got. SPEAKER_11: And the senior copywriter gave her side eye and said, well, I don't even think that's grammatically correct. But they had run out of time, so they just rolled with it. SPEAKER_11: But nobody, nobody foresaw what this tagline would become. A diamond is forever. SPEAKER_01: A diamond is forever. Forever. SPEAKER_05: Forever. Visit adiamondisforever.com. SPEAKER_09: And in this way, through engagement rings, De Beers convinced the world that diamonds are the rarest, truest, most valuable of the stones. So, aside from just generally convincing the customer that he should buy a diamond or that she should demand a diamond, SPEAKER_11: these ads also had the intention of saying, these are the different cuts, this is how much they cost, things like that. In their ads, and in pamphlets made for diamond sellers, De Beers informed the consumer about exactly how much money they should spend. SPEAKER_09: And to a degree, this is still true for diamond engagement rings today. The person selling you the diamond is probably the one educating you about them. SPEAKER_03: I mean, it's high purchase price, there's a lot of education involved, and it can be emotionally weighty. SPEAKER_06: So, we really want people, when they're coming into the showroom, to feel relaxed, like they're having fun. Brilliant Earth is a diamond retailer with six showrooms around the U.S. SPEAKER_09: I'm Catherine Money, vice president of merchandising and strategy at Brilliant Earth. SPEAKER_06: So, you are not the person who will come to greet a couple? SPEAKER_06: Typically, no. Typically, we have a jewelry specialist who's working with a couple, and they're having this one-on-one interaction, very focused on education, sitting down learning about the four C's. The four C's is a shorthand created by De Beers to assess the rarity, and therefore value, of a diamond. SPEAKER_09: It's still in use today. The four C's are cut. SPEAKER_06: Cut measures symmetry, polish, and proportion. Color. It's rated on a color scale from D, which is the most rare, and we will sell D through J. Carrot. It's a measure of weight. And clarity. Clarity is determined under ten times magnification by a trained gemologist, since most of the characteristics can't be seen by the naked eye. SPEAKER_09: So, that's the thing. If you can't see it with the naked eye, like if it's not for aesthetics, then what is this for? Is a rare diamond, one that's got good color or cut or clarity or carrot, actually worth anything? Is it an asset? Is it like investing in a house or buying a piece of art? SPEAKER_11: In fact, a diamond is much more like a car, where once you've taken it out of the lot, the value plummets. SPEAKER_09: Rachelle Bergstein's answer is, most typical engagement diamonds aren't worth much. Unless the diamond is exceedingly special, like it is ridiculously preposterously big, or was cut by Harry Winston himself, or worn by Elizabeth Taylor. Those are worth a lot. But for the most part, the value of a diamond ring comes from who wore it or touched it or cut it. So unless you're a celebrity... You can't flip a diamond. No one's going to buy it back from you for the same price that you paid for it. SPEAKER_11: Why? First of all, because you paid retail, and whoever you're selling it back to is not going to pay that same retail markup. You're going to take a loss. And second of all, if it's just your run-of-the-mill diamond engagement ring with a decent quality stone, they're a diamond dozen. And there are dozens more beautiful, brilliant diamonds being grown every single day. SPEAKER_09: This is the other thing that feels freshly ridiculous about the myth of diamonds. Like, how can we possibly think they are rare if you can grow them in a laboratory? Real diamonds, not knockoffs like cubic zirconia. Stones that are chemically identical. There are literally diamonds growing in that room with this incessant hallucination-inducing hum that never stops. SPEAKER_10: Are you OK? SPEAKER_05: I'm fine. I'm fine. SPEAKER_10: He's getting over it. SPEAKER_09: Jonathan Levine-Miles is the CEO of J2 Materials. John Seraldo is the CTO of J2 Materials, and the fact that they're named John and Jonathan is why they're called J2. They grow and sell diamonds used for engagement rings. But that's not why they got into the diamond business. They aren't particularly interested in rings. They're interested in the way diamonds can be used in future technology. Every time we sell a gemstone, it will inevitably help fund our diamond semiconductor research. SPEAKER_09: As computers get more and more advanced, silicon might not be able to handle all their processing power. So diamond might become a good alternative material for computer chips. But this would require large plates of diamond that are perfectly clear and smooth. And John and Jonathan can't sit around and wait for the Earth's crust to produce that. Which means it has to be grown in the lab. SPEAKER_10: And so fundamentally, that's what we are trying to do here. SPEAKER_09: J2 Materials is in a strip mall in the suburbs of Chicago. It's the kind of space that could just as easily be a dentist's office. But it's filled with reactors. The moment we turned on our first reactor, when it was just the two of us, it was on 24-7. SPEAKER_10: It shuts down just long enough to take out the diamonds, to clean the chamber, and to start it up again. So we never shut down. SPEAKER_09: These reactors look like rice cookers blown up to the size of washing machines. And normally we think of diamonds being created in the Earth under a lot of pressure. But that's not what's happening here. An extremely simplified way to explain J2's approach is that they're taking small bits of carbon and growing them into full diamonds. Almost in the same way you would grow a crop, where some turn out beautifully and some are duds. Like how some potatoes turn out hearty and strong and others end up small or lopsided or heart-shaped. It's not a mass-produced thing. It is an art. It is a complicated thing. SPEAKER_01: I'll probably put it a little more bluntly and say I think there's, as a scientist of course, big caveat, SPEAKER_10: there's tremendous beauty in being able to take essentially cow farts and converting it into this technologically advanced yet beautiful material. SPEAKER_09: Diamonds have been synthesized in laboratories since 1950. But it used to be mostly for industrial uses, like for surgical knives or the knives used to cut aluminum for iPhones. It's only very recently, like in the last couple of years, that laboratory-grown diamonds have started to look just as beautiful as the ones from the ground. Again, John and Jonathan didn't set out to make engagement rings. But businesses like theirs have put the traditional diamond industry on edge. We've definitely seen significant growth in lab diamonds. SPEAKER_06: So consumer acceptance, particularly among millennial consumers, has increased. And you sell those here? We do. SPEAKER_09: Oh, wow. Catherine Money of Brilliant Earth told me that lab-grown diamonds are sold almost interchangeably with mined diamonds. They are also assessed for rarity using the 4Cs. The main difference is that they're cheaper. SPEAKER_06: And generally, consumers are drawn to lab-created diamonds because they're beautiful, they're responsible, and they're affordable. Lab diamonds do use a lot of energy to keep the reactors humming. SPEAKER_09: But it's certainly less energy-intensive than digging a massive crater in the earth. Lab diamonds seem like an ethical, attainable option, especially to a generation of marriage-aged consumers who are broke and were raised in the 90s and 2000s among whispers of blood diamonds. The diamond industry is still reeling from that blood diamond reckoning over 20 years ago. Back then, De Beers was rightfully worried that people would boycott them and that the value of diamonds would plummet. So De Beers did something pretty drastic. They sold off a lot of their diamond reserve. They ended their own monopoly. Between, I would say, 2000 and 2004, De Beers liquidated their stockpile. SPEAKER_07: You saw other companies emerge in the space, other diamond producers. SPEAKER_09: De Beers relinquished control of the global diamond supply. Consequently, they stopped advertising for all diamonds. De Beers went from being the only player in the industry to one of several. And as a result, the mined diamond industry has slowed down a lot. Almost nobody's exploring for diamonds, nobody's building new diamond mines. SPEAKER_07: So I think we actually could run into a situation where there's a shortage of diamonds in the future. SPEAKER_09: Paul argues that in like 5 to 10 years, diamonds from the earth will become rare again. Because fewer mines are being cultivated, that scarcity that De Beers faked through their monopoly might actually come true. So this means there's two kinds of diamonds in the market right now. Mined, or natural diamonds, the kind that are getting rarer and more expensive. And lab-grown diamonds, or man-made diamonds, which are proliferating and getting cheaper. The question is, can you tell the difference, and does it matter? So I think it's important to make the distinction that man-made and natural diamonds can be distinguished with certainty. SPEAKER_07: Very good. Yeah, I mean that's interesting that you're doing all this work and you didn't even realize that. SPEAKER_09: Listen, Paul, I can't see the difference between lab diamonds and natural diamonds. You can't with the naked eye. And even with the official fancy equipment, some diamond sellers in the diamond district can't tell the difference either. SPEAKER_10: When you regular test, diamond test, you say diamond number. SPEAKER_09: When I visited the diamond district, I asked a couple jewelers to look at a pair of lab-grown diamond earrings. I know for a fact that these earrings are lab-grown. They were sent to me by a lab-grown diamond company. And these two diamond sellers, with booths across from each other, took turns testing each earring. And I am fairly certain that they both got it wrong. SPEAKER_00: What are yours doing? One, one. SPEAKER_02: Yeah, mine was one and all. SPEAKER_00: Yeah, two different sheets. That was actually a jackpot. SPEAKER_09: And Paul said, that one's a jackpot. Because both jewelers told me that one earring was quote-unquote real and the other was lab-grown. One diamond seller offered to buy the real diamond for between $500 to $1,000. $500 to $1,000 is not chicken feed, right? SPEAKER_00: And then the other one you'd sell at a very low price. Like what's a really low price for that one? SPEAKER_09: Like a hundred, really? SPEAKER_00: Yeah, it's fake. It's not fake, but it's lab-grown. SPEAKER_09: I don't know if you could hear that, but he said the lab-grown diamond would only be worth about $100. So one earring was supposedly worth ten times more than the other. And again, I can't emphasize enough that this pair of earrings came from the same laboratory. We value diamonds for their perceived worth so much more than anything about the way they actually look. I sell an engagement ring for $2,000. SPEAKER_05: The guy goes, could you write an $8,000 appraisal? I'm like, well, I can't do that. I'm not doing that. SPEAKER_00: You know, because they want to put that in front of the girl, you know, and say I bought an $8,000 ring. I mean, it's kind of smart, but... Well, I would say if you're going to start a relationship that way, I'm not going very long. SPEAKER_09: You know, that's my point. Never mind. Not a good idea. Don't lie to your partner. But I guess it still just seems odd to talk about how much your proposal diamond costs if you can't see the difference. I mean, it shouldn't matter, right? And the question is, would proposing to someone with a $100 diamond, would that have kind of the same impact? SPEAKER_07: And this is something that's not practical or not rational. So I don't see a diamond as an investment in the material object, but it's probably an investment in a commitment that you're trying to portray. Catherine Money at Brilliant Earth gave me pretty much the same answer, SPEAKER_09: that diamonds are valuable because they are tied to our deepest relationships. It's a representation of commitment and love and values. SPEAKER_06: At the time, I thought this answer was a bit of an evasive cop-out, but it's not. SPEAKER_09: This is how real, tangible value has been created and assigned. By De Beers, sure, and by all of us. By everyone, myself included, who wondered if Courtney and Sean were really engaged without a ring. Without a diamond. SPEAKER_02: I thought that I was better than that. But you're not. But I'm not! Look at this friggin' sparkly thing. Let me see it. It's so beautiful. Courtney caved. I was like, OK, we can get rings. I give in. But we have to get them vintage. SPEAKER_09: If you really wanted to get a diamond and minimize your impact, a vintage diamond is the way to go. Compared to digging a massive hole in the earth or a room full of humming reactors, your grandmother's ring doesn't emit any fresh carbon. We went to the Alameda Fleet Market. SPEAKER_02: Courtney's ring has not one, but two diamonds. SPEAKER_09: And in the center is a ruby. Sean's ring has a sapphire. SPEAKER_02: It ended up being ruby and sapphire. I ended up with ruby, which is the Pokémon game I'm playing, and Sean ended up with sapphire, which is the Pokémon game she's playing. It's so cute. Their rings still fit into their nerdy little world. SPEAKER_09: And even though diamond engagement rings are built on a bedrock of BS concocted tradition, all traditions get made up somehow, and they become more authentic as they get ossified in time. Courtney and Sean love their rings because they love each other. It is not, and has never been, a rational thing. 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SPEAKER_09: Author Rebecca Mead says someone used to be a bride for a day, and now you're a bride for as long as it takes to plan your wedding, which has gotten more and more elaborate. SPEAKER_08: I found an article that was published in 1939 called The Cost of Weddings in the American Sociological Review, and a third of the brides didn't have an engagement ring. Sixteen percent were married in clothes they already owned. A third of them married without a wedding reception in addition to the ceremony, and about a third of them didn't have a honeymoon. So these things that we think of as absolutely core elements of what a wedding is just weren't necessarily core elements. The wedding industry has emerged to convince brides that you're not really a bride without a massive cake, SPEAKER_09: without a rehearsal dinner, without a lingerie set, without something old and something new and something borrowed and something blue. And we all know that no one needs a party that might cost tens of thousands of dollars. We live in a consumer culture. We're not ignorant of the fact that we're being sold stuff that we don't need. SPEAKER_08: We all have some discretion and some sense of distance on that. But when you're being told, this is how it's done, you just want to do it all the right way. And if you don't do it like this, then maybe you're not doing it properly. And if you're not doing your wedding properly, maybe you're not properly committed to your marriage. SPEAKER_09: Your next articles of interest are wedding dresses. SPEAKER_04: For a way of advertising online, go to Brave.com forward slash ads.