Wine Talk

Snooth User: dmcker

Utterly absurd

Original post by dmcker, Mar 1, 2012.

A couple of news items I was pondering today.

First, Robert Parker came out with his ratings for the 2009 Bordeaux vintage. Ever the masochist, I decided to go look at some prices in the marketplace after the ratings were released. Some samplings:

2009 Chatau Latour                        100 points                  $21,500 a case

2009 Chateau Margaux                   99 points                   $17,500 a case

2009 Chateau Ducru-Beaucaillou  100 points                   $ 4,000 a case

2009 Chateau Pavie                       100 points                   $ 5,400 a case

2009 Chateau Palmer                       97 points                   $ 4,500 a case

2009 Chateau Pichon Comtesse      95 points                   $ 2,900 a case

2009 Chateau Leoville Barton           93+ points                $ 1,490 a case

2009 Chateau Troplong-Mondot        99 points                  $ 2,150 a case

2009 Angelus                                     99 points                  $ 4,925 a case

2009 La Clarence (Haut Brion 2nd)   92 points                  $   950 a case

2009 La Croix (Beaucaillou 2nd)        91 points                 $   580 a case

 

$333/bottle, current release for Beaucaillou? $1,458 for a bottle of Margaux?? $450 for Pavie??? $375 for Palmer???? We're supposed to feel we've scored a bargain with Leoville Barton at $124, or the worst 1st growth 2nd label at $79, or the 2nd of a 2nd at nearly $50????? Again, these are all current releases! None of these wines should be drunk for several years, anyway. And, BTW, these prices are on the low side of the market for each label.

So my question is, who's buying these? And why, when there's so much good wine from other areas at much saner levels of pricing, that will give at least as much pleasure (even though I'll admit I do have an unfortunate weakness for Latour, initiated back when it was affordable--unfortunate in that it can undo small fortunes if excercised these days!)? And what kind of thin-aired atmosphere do the Bordelaise want to try to keep living in? After the Chinese economic bubble bursts, good luck, I want to say, but the devil on my other shoulder then pipes in with 'tough luck, you've earned it'.

To put things in perspective, GregDP's series of articles on the $2500 and $5000 dollar cellars would be made totally irrelevant if someone wanted to buy any of the above. Personally, I'd *much* rather have his $5,000 cellar than a single case of the 2009 Angelus!

The second news item was a marketing director for a Wall St. firm, earning $350,000 a year, crying poor and saying he can barely consider himself a full member of the middle class, living as he does in Manhattan. In that part of that town, trying to keep up with the real players in those firms (marketing directors are just support team players, anyway, with no real playing time in the big games), I can almost commiserate. Especially if he wants to buy a bottle of good Bordeaux out at a restaurant (add their markups to the costs above)!   ;-(    But then he also probably pays a higher percentage of tax than Warren Buffet...

Replies

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Reply by dmcker, Mar 5, 2012.

A further update from LiveEx. Note the radical movement for SHL, doubling in one day! Though the table at bottom shows it wasn't just that label, one still wonders who would ever have predicted that rating for SHL, thus being in a position to reap serious profits over a very short term...

 

 

02 March 2012 Bordeaux 2009 trade powers on

This morning we reported that many of Parker's "perfect" wines were trading on Liv-ex at premium prices. The torrent of 2009 trade continued into the afternoon, with numerous wines reaching record highs. Among those on the up was Haut Brion 2009. After falling to a low of £6,200 per case in February, the vintage changed hands at £7,500 today - its highest level since June 2011. The most exceptional transaction of the day, however, was Smith Haut Lafitte '09. As you can see, the wine's value has more than doubled to £1,400. 



The table below shows a selection of recent 2009 trades. Alongside them are the prices that the wines were trading at in February (i.e. prior to the release of Parker's scores). 

Liv-ex members can view live markets here


All prices are for 12x75cl cases stored in bond.

 

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Reply by dmcker, Mar 5, 2012.

And WineSpectator has weighed in, as well, with the table of crtiics' top scores also borrowed from LiveEx. No 100s for Molesworth, with Latour and Petrus the standouts. Molesworth is more conservative in several ways than Suckling and Parker.

The full set of tasting notes is at www.winespectator.com.

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Reply by dmcker, Mar 5, 2012.

Obviously, all these scores are for people (whether producers, consumers or middlemen) who either don't want to think for themselves, or, increasingly, want to speculate. Purely a tool of a certain type of marketplace that enters almost no way into my drinking life other than how it affects the price I have to pay for the wines I want to drink, and in a way that can hardly be viewed as positive. Then there's the absolutely deleterious effect that the economic impact we've noted above has on winemaking in regions all across the world, whether it's Bordeaux or CA or Oz or just about anywhere else. All that fruit and wood and immediate drinkability and creeping homogenization of style. So it also affects the wines I buy in that I can no longer palate an increasing number of wines I used to love thanks to their 'Parkerization'.

I haven't wanted to take this thread off onto a tangent where the whole 100pt scale is questioned, because other threads have done that in the past. I still will throw in a 'manifesto' that I just ran into when looking into the wines made by a vineyard in Washington State that, along with a number of others, doesn't submit its wines for ratings. From scorevolt.com. I don't know much at all about the people behind it, but thought it did provide good impetus for a moment of reality-check meditation...

 

Wine is a gustatory expression of the place where its grapes grew and the methods by which they were farmed, these methods having been developed over time to address the variability of nature. The combination of land, climate, culture, and philosophy is terroir. Ideally a wine will evoke an understanding of the region and perhaps the individual vineyard that was its place of origin. The subtle expression of wine is best understood through the context of its geography.

There are many inputs to the system that will ultimately affect a wine, but if the goal is to approach the subject from a minimalist mindset, to alter or influence the process as little as possible, while still preventing infection and spoilage, then surely the essence of terroir is preserved.

If we rely on the biased palates of a select few – and no palate can ever be unbiased, as the process of tasting is supremely personal – to tell us what is good, great, and perfect, then haven’t we sacrificed our own personal understanding of the wine, and as such, what would be the point of drinking it?

The 100 point rating system is a clumsy and useless tool for examining wine. If wine is, as we believe, a subjective, subtle, and experiential thing, then by nature it is unquantifiable. Wine scores are merely a static symbol, an absolute definition based on a singular contact with a wine, and thus completely ineffective when applied to a dynamic, evolving, and multifaceted produce.

To discuss a wine’s tannins, acid, balance, structure, fruit, etc, is essential. To share our thoughts and experiences with other humans is arguably one of the most important parts of drinking wine. To introduce a score to this process is condescending, overly simplistic, and often largely inaccurate.

Wine is infinitely variable. This is the nature of terroir, and also of humanity, which is inextricably twined with terroir.

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Reply by JonDerry, Mar 5, 2012.

Little bit more of a classical look for Molesworth.

Not really surprising that the SHL has doubled, it's hard to find 100pt. wines under $200 these days, inflated Parker scores or not. Also further proof that there are plenty of point chasers out in the world.

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Reply by Richard Foxall, Mar 5, 2012.

Thanks for that post, Brugman.  After the 1987 stock market crash, I did some work related to the Hong Kong Stock Exchange. One thing that stood out is that pump and dump is utterly legal in Chinese-run markets, and has been historically.  Caveat emptor is the closest thing to a rule in the market, and, as a result, it's treated like the casino it is by the Chinese.  A great number simply stay away and the rest, presumably, know they are trading on insider information or will be taken for dupes unless they are lucky.  While HK was a protectorate, the English would reform it along western lines, and the Chinese would (literally) move down the street and start a new, unregulated exchange.  When that became dominant, the English would move in and regulate that.  Lather, rinse, repeat.  The rule of law was not present.  But will  the current real estate and speculative boom that's fueling these wine prices, at least from China, end with the government stepping in and forfeiting estates or businesses?  There's no 5th Amendment rule against takings that I am aware of, so it could.  And the rules largely seem to get made up as they go along by the Party. 

I love a good, inexpensive wine, but I also find that the near-ecstasy that I get from a Mauritson or Talty Zin, or a great Napa Cab, easily justifies the extra money.  I just want some correlation and a degree of predictability at those prices--not a possible bottle of cooking wine. 

dmcker, thanks for all these posts.  99 points is just silly, too--and smacks of a response to RP. "Oh, sure, it's great, but perfect? Well, we're not sure, but we might've tasted better."  The degree to which they match up is suspicious, and I want to know who drank these blind and against what benchmark?

D'you think this is gonna do anything for my SHL from a lesser vintage? Like, make it taste better?  ;-)

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Reply by BrugmanRose, Mar 6, 2012.

JonDerry probably says a lot of what people feel today about the prices going so high they make it difficult to buy what one use to drink. But I will bet you if you push your retailer to ask his wholesalers for odd bottles in the warehouse or some importer trying to find a home for a wine, you may come up with some interesting bottles.

For all of you who are not in the business, let me tell you that importers often bring in odds and ends for two reasons. One it fills the container and cuts the cost of shipping. And he is hoping someone will pay attention and buy the wines at low prices so he can try to establish a buying market for the label in the future. What is that expression I kept hearing after returning from Japan: “ Been there, Done that”. Well it is appropriate for me to say.  I always brought in 50 to 200 cases of wine I wanted to introduce to the market in Japan with my regular order. It help cut the costs and I usually got it very inexpensively because the exporter wanted to build a market. More than often I was successful in introducing the wine to the Japanese market in Tokyo and Osaka because I knew what my retail customers were looking for in flavor and price.  In Japan quality if very important and a high price for good quality is not a combination that slows sales down but actually increases sales. But the quality and price had to be proper in value.  I build a lot of labels for importers in my time in Japan using this technique so ask your retailer to start asking questions what their wholesalers have in the odds and ends bin.

Hello Foxall, it is nice to find an old China Hand. This is an expression usually bestowed on businessmen who went to China or Far East on their own and started their own company with their own capital. But by the time I arrived in Taiwan, such titles were no longer issued as there were no more rich individuals coming to  start major trading companies. Another name for the more prosperous men was Taipan. Most of these men came to Chine in the 1800’s  I was an individual who came on his own and not under salary from New York or any other American headquarters and I made my own way for 12 years. So I might be called Old Little China Hand. Because I think there are so few of me, that I have to extend the title to Foxall. It is good to read another Old little China Hand thoughts about what is going on there and what the possibilities could be.

If the market does collapse as it should, I am sure the Government will take over the private wine cellars and sit on the wine. Then is the time for you, Foxall, to buy a ticket to Shanghais and claim that you are the man who knows how to care for the wine and keep it in a good state of being so the government can serve it at foreign dinners and impress immensely their guests.  They certainly would not want to sell such a prestigious collection of wine that may very well  age for many more years and possibly decades.

To those of you who think I am making fun of Foxall, beware that I am not. There is opportunity for people with good strong wine fundamentals to work in China. People who are buying the wines today have not the slightest idea of how well the wines will age and what needs to be done to care for them. If the Government does take up many private collection they will need people with expertise. They may not pay you well so you may have to teach English as a second job but rest assure you will be honored amount the important people there and treated very well. Bon Voyage mes amis.

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Reply by shsim, Mar 6, 2012.

Thanks dmcker for sharing scorevolt.com.

Brugmanrose, in chinese, we would call you in a sense 'daring' for doing that. And right time now that the chinese market has opened up alot more than before and theres alot of wealth that people are eager to spend... thus the lack of knowledge. Alot of times they just want the satisfaction of buying the expensive bottles and drinking them with others to show it..

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Reply by Richard Foxall, Mar 6, 2012.

BrugmanRose, I take that as a compliment, although undeserved.  Though there were several assignments over the years, my business liaisons with China and the offshore Chinese in other parts of Asia never required me to learn any variant of the language or even took me off North America.  My one trip to Asia (for a wedding!) took me to Nepal and Bangkok--next time, at least one of the layovers will be in Tokyo so I can raid dmcker's cellar. ;-) My wife toured China on a  Gates Foundation-sponsored trip and had much to say about it.  

More likely I will wind up closer to the source of all that wine--Europe seems likely.  But that sounds like a great next chapter for someone like dmcker who is far more knowledgeable in wine and Asia than I am.

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Reply by JonDerry, Mar 6, 2012.

Yes, we of the Snooth board hereby nominate Dmcker at least for all things Japanese and perhaps China, should he accept.

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Reply by humpdog, Mar 6, 2012.

one case of 2009 chateau latour =$21,500

one 2012 honda accord LX=$21,380.

this is where humpdog math begins and ends.  i say that without even one iota of shame.

did i mention i have a 15 year old son?  i'm not buying him the 2012 accord though.  that one may be for me.

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Reply by shsim, Mar 6, 2012.

Haha!! That is a great comparison and it works for everyone! For me, I can think of the 40000 bowls of Malaysian street food I can get with the one case of the Chateau Latour that will last me a lifetime. Even if i want to eat it, I will feel better getting a bowl for the street kids.

And you know, I might just buy the case anyway.. sell it to some rich folk for twice the price (because they might just buy it) and get 80000 bowls of noodles.

This is making me hungry.

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Reply by jsncruz, Mar 7, 2012.

"People who are buying the wines today have not the slightest idea of how well the wines will age and what needs to be done to care for them"

 

Truth.

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Reply by Richard Foxall, Mar 8, 2012.

Ever ask yourself, "If I could afford to drive any car at all, what would I drive?"  So, after a hedge fund hotshot has answered that question a few times, and has a Bugatti Veyron, a Ferrari, a 600 Series Mercedes, and a few more, he moves on to DRC and first growths.  I would feel silly driving even one Mercedes 600. (I broke one in for someone once, nice, but didn't change my mind, and the comments I received from "admiring" friends made me more uncomfortable than proud.)  I've worked for a few billionaires and hosts of people in the 1% and I never got over how often they expressed that whatever they had, power, toys, cars, homes, it was never enough if their colleague/neighbor/competitor had more.  My sister asked a Silicon Valley entrepreneur when he'd would know it was enough, and he said, "When I have $10 mil more than my neighbor."  All the La Tache in the world won't fill that hole.

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Reply by JonDerry, Mar 8, 2012.

Very true Fox, that competition between friends, acquaintances, neighbors, business people, accounts for a lot of the meteoric rise in pricing. Wine is becoming much more popular and fashionable also, the more people in the pool, the more competition.

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Reply by shsim, Mar 8, 2012.

I agree Fox. Its an endless game if they choose to play it. And its not that fun. And JonDerry, it is true that wine is becoming more popular. Do you think it is an age thing too though? We start to shine away from hard liqour and beer of our youths and turn towards the more 'sophisticated' wine. Or it is a generation thing? Certain generations probably have drinks of choice etc? Probably a combination of both.

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Reply by shsim, Mar 8, 2012.

Though I should share this while we are on the topic.

http://www.huffingtonpost.com/2011/11/10/most-expensive-wine_n_1084988.html#s463475&title=1978_Montrachet_24000

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Reply by gregt, Mar 8, 2012.

 

one case of 2009 chateau latour =$21,500

one 2012 honda accord LX=$21,380.

I completely understand that.  You buy the car and it lasts you what, 10 years? And by the time it's 10 years old, it's an "old" model, no longer of interest and worth little.  The Latour isn't even peaking at 10 years, and as it continues to age, it apprciates in price.  Moreover, you have a lot more fun drinking a bottle of Latour than you do driving a little Accord. 

So actually I'm with you all the way. I see your point and I'd pass on the car too.  Even tho the wine is only $120 more, it's clearly the better overall value

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Reply by dmcker, Mar 9, 2012.

Now Greg...  ;-)   Humpdog is likely the most sane of us here....

And Brugman, I'm sure, has plenty of experience in Taiwan, dealing with the mainland, and importing into Japan (as well as whatever visits over the course of however many years) that I'm sure would be uniquely interesting to hear. I, for one, would like to learn more about the ups and downs of his dealings with the Japanese, whether regarding US wine or European or from anywhere else!

One of the reasons you see sake on many of the winelists in upscale restaurants across NYC and other US urban areas is because the Japanese have been traveling tons and spending more over the past two to three decades. Does this mean we'll see shaosing wine and maotai on the great (if France-centric, with tariffs on several well-aged, rare bottles that put almost all the 100pointer prices above well in the shade) winelist at 11 Madison, or elsewhere, in the future?

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Reply by dmcker, Mar 9, 2012.

OK, guess we've gone on long enough without another tangent. Since China was mentioned, couple of things I saw today...

First, from an interview with Mathilde Chapoutier, daughter of Maison M. Chapoutier, famous in the Rhone, who's now located in Beijing:

"Is wine important for young Chinese women?"

'Mathilde Chapoutier:"Chinese people drink and enjoy wine. They demonstrated they were open-minded by moving from the eternal baijiu and beers to some wine. Young Chinese women have a passion for elegance and refinement from the Western countries. They’re keen on French fashion, cosmetic brands but also on wine. They are keen on all wines, both on the Cotes du Rhone Belleruche or on our prestigious Hermitage L'Ermite. Here, like everywhere in the world, women become emancipated, they show a strong desire for independence. Journalists, businesswomen, wine lovers... there are more and more women who are very interested in wine in general and French wine more specifically. You can feel it on the streets, in the restaurants and in their everyday. And, in the future, wine will continue to contribute to the emancipation of young Chinese women."'

 

Ah, that youthful enthusiasm--wine will change the world!

 

And second, it looks like the transition from a Bordeaux to a Burgundy focus in prestige wine marketing to China is gaining steam, one example being this auction at the end of the month. Unfortunately for us consumers elsewhere in the world, this now means attention shifting beyond merely DRC:

"One of the major collections of the auction, "The Golden Dragon Collection," comes from a prominent West Coast American collector. The roster of producers in this offering reads like a veritable "who's who" of France's Burgundy and Rhone Valley regions and includes such luminaries as Henri Bonneau, E. Guigal, Domaine Denis Bachelet, Domaine Dujac, Domaine Jean-Marie Fourrier, Domaine Meo-Camuzet, Domaine Mugneret-Gibourg, Domaine J-F Mugnier, Domaine Ponsot, Domaine Georges Roumier, Domaine Armand Rousseau, Domaine Coche-Dury and Domaine Leflaive, as well as the renowned Domaine de la Romanee-Conti. Other noteworthy collections include the "Legacy Collection," the "Empire State Collection," the "Rocky Mountain Collection," and the "Laguna Beach Collection," all of which encompass a superb selection of conscientiously cellared rarities from France's Bordeaux, Burgundy and Rhone Valley regions."

 

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Reply by dmcker, Mar 9, 2012.

As an addendum to the last post, I'll go out on a limb and predict that Champagne prices will be the next to get hammered by Chinese attention, at least until the bubble bursts. From an article in Decanter that talks about how last year was the third best year in history for Champagne sales--pretty good in the midst of a global economic downturn.

"The best performers in the emerging markets were Russia (up 24.5%), China (up 19.4%), and Hong Kong (up 15.1%) – but the rate of growth slowed in the second half of 2011; these three markets between them still only account for 4.1m bottles."

India, though at a lower level, grew 60% last year.

Lots of room to grow there (that's only a fifth of the size of the American market last year and a sixth of its peak)...



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