“COME with me Daaahlink,” the glamorous old Iranian lady beckoned from the corner of New York’s 47th Street.

Moments later, and six floors up in a tiny office, she took a dozen pieces of greaseproof paper from her handbag and unwrapped each one to reveal a dozen gleaming diamonds. “There, you see why I am nervous outside,” says the woman, who is known only as Nayer. “I have $100,000, maybe more, of gems in my purse when I wait for you.”

On her right index finger she wears another huge diamond.

Americans buy more diamonds than any other nation. Last year they spent $30 billion (£17 billion), about half of the total world diamond jewellery market. Of those stones, about two-thirds passed through the scruffy commercial block between Fifth and Sixth avenues where Nayer plies her trade as a broker.

47th Street is the centre of the universe for diamonds. The likes of Harry Winston, Graff, Cartier and Tiffany, whose windows sport rocks the size of fists with price tags that run to more than seven figures, are only half a mile to the north, but they might as well be a world away from the street Nayer calls “the office”.

“Tiffany, Cartier, they use stones from 47th Street,” Nayer says. “They all come through here but the prices they charge are 50 per cent to 60 per cent more than you get here. For the same thing.”

She is right. One of the gleaming 1.5 carat stones in her purse, with near flawless colour and high quality sells for about $10,000. Nayer will set it in a ring of any design, of any material, for a few hundred dollars more.

A Tiffany ring made of the same quality diamond, in a virtually identical design, costs $16,000 or more.

Ayzik Kohan, a diamond dealer and president of Sako Diamonds who supplies Nayer, advises anyone thinking of buying diamond jewellery to come to 47th Street, even from Britain. “You will save thousands of dollars here,” he says. “Tiffany and the rest market their diamonds very well. But they are like Prada or Gucci. You can pay a lot more for a leather purse made by these companies. But wouldn’t a woman rather have something hand-made just for her?”

Nayer has worked on 47th Street for 20 years, her daughter Ruth and son-in-law Scott, her brother and her husband when he was alive were once or are now in the business.

Nayer’s family are Iranian Jews who left Tehran for London before the revolution. In the 1980s they moved to New York, but wherever they have been, the family traded in diamonds and gold. “We have always been merchants,” says Ruth.

47th Street has been the diamond centre of New York since the early 19th century. Then Ashkenazi Jews from Eastern Europe fled persecution to begin new lives in America. Their cash and property were taken from them but a few families were able to sell what they had for diamonds, which were small enough to sew into their clothes. When they arrived in New York they had gradually to convert their stones back into liquid currency, so diamond cutters, polishers and jewellery makers were needed. Over the years Iranian Jews superseded the Ashkenazim, and now Russian Jews have come to the fore — as they were the last group to arrive.

At street level, shop windows sparkle with diamond rings and gold chains. But it is in the basements and upper stories where the real business is done.

Below stairs, diamond cutters and polishers, who are largely Hassidic, toil in tiny workshops, producing beautiful gems from rough stones. Up above, crammed dozens to a floor, the buyers and sellers run their lucrative operations.

Mark Auclert, the head of jewellery at Sotheby’s, says: “It is truly a phenomenon. They are multi multimillion-dollar businesses and they operate out of two or three square metres. It is incredible.”

Mr Kohan says that it is rare for someone from outside the industry, especially one who is not a customer, to come into his office. “We do business here on a handshake. It is all about reputation,” he says. “If I give Nayer or someone else maybe $100,000 of stones her credit is her name. She does not need to pay for these stones, I know her. I know her family.”

Mr Kohan’s brother David hands an enormous four-carat stone through a little window to be examined by their assistant Yoriko.

“You would have to put up a lot of money to get this on credit if I didn’t know you,” Mr Kohan says.

But this is a dangerous business, which is why Nayer, who runs a company called Nayer Fine Jewelry, will not give her full name and will not be photographed. There are frequent robberies on 47th Street, mainly by gangs of armed Colombians connected with the drug trade. “They won’t rob ordinary customers buying a ring or a stone,” she says. “But they watch the brokers and the runners. They try to find out who is carrying a lot of stones and then, boom! they hold you up with a gun.”

The brokers have an unspoken agreement with the Colombians that they will hand over the stones without a fight if they get caught and the Colombians in turn do not engage in indiscriminate violence. “I’ve been tied up and robbed in a gold dealers, my husband Scott is a jeweller and he’s been robbed at gunpoint. It happens all the time,” Ruth says.

A new retail diamond venture being launched by Sotheby’s is just the latest high-class offering in New York gems.

Last month De Beers opened its first high street store in the country, after it settled a legal action last year, and Tiffany is expanding.

But such designer names are no threat to 47th Street. “They are good for business,” says Mr Kohan. “The diamond trade is growing, diamonds are more fashionable than ever, the prices are rising. Supplies are getting tighter.”

But there is one thing greater than market forces that will ensure 47th Street is around for many years to come. “If you don’t know jewellery, you should know the jeweller,” Mr Kohan says with a broad grin. “He is as important to you as your doctor.”

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