As has been pointed out, clicking on it enough times reveals "Perfect Gem Activated" nowadays. Long ago it would display something like "Moooo". I'm not sure if it changed with each patch or not, but the three strings for it are in STRING.TBL in PATCH_D2.MPQ (can't remember what the patch filename is for the expansion.)
As for what it does, well, I always assumed it granted a better chance of finding gem shrines since I'd always activate it and then find a gem shrine in my game more often than not. Of course, there's no factual data to substantiate this. :)
With the latest patch, gem shrines have become as rare as useful item drops (and even shop sales) so I no longer attribute anything to the chat gem other than purple text and the occasional special message.
(Edit: spelling mistake)
As for what it does, well, I always assumed it granted a better chance of finding gem shrines since I'd always activate it and then find a gem shrine in my game more often than not. Of course, there's no factual data to substantiate this. :)
With the latest patch, gem shrines have become as rare as useful item drops (and even shop sales) so I no longer attribute anything to the chat gem other than purple text and the occasional special message.
(Edit: spelling mistake)