No recession in the wine market

I know that we can be a bit “glass half empty” here at WF blog central, but what do you expect of people in the lending business? So, for all of our handwringing about a U.S. recession (see prior posts “Some U.S. Recession Hints” February 14-07 and “Buckle up – the wheels have come off” August 13-07), here is a bit of good economic news.

It wasn’t that long ago, maybe 21 months, that Ontario’s LCBO was marketing their 2005 Bordeaux Futures. You could have snapped up a bottle of 2005 Chateau Latour for the princely sum of $995 per bottle. With wine experts giving the lot a potential rating of 96-100 points, there was some hype about the vintage.

Today, if you wanted to buy that same bottle from a U.S. retailer (not yet in stores up here), the prices are astronomical:

California’s Aabalat markets the bottle for US$1,687.95
New York’s Pops Wine & Spirits is sold out at US$1,495.00
Dallas’ Le Cave Winehouse prices it at US$1,695.00
Miami’s Kendall Fine Wine & Spirits wants US$2,495.00 (but says “please call”)
Scarsdale’s Zachys has rounded it off at US$2,500.00

I suppose that a call to these wine shops could produce a better price, but the interesting thing is that they think wine buyers won’t be irreparably turned off if they show these types of prices.

For all of the time you might spend trying to figure out the stock market, 2005 Chateau Latour futures are “trading up”. What you could get for your own bottle(s) on eBay isn’t quite clear, but unlike owning units of Kevin O’Leary’s investment vehicle (see prior post “O’Leary Fund promises to share the wealth and wisdom” May 8-08), you can “drink while you wait”. Which sounds so much more appropriate, particularly in recessionary times, than Mr. O’Leary’s promise of getting “paid while you wait“.

Perhaps someone should start a hedge fund to play these futures. Can’t be a worse idea than the fund that is being started to invest in Thoroughbred Racehorses. As JR once said to me, “never own anything that eats while you sleep”.

MRM