For those of you my age (gulp… 58), you likely well remember those wonderful game shows where the Bob Barkers of the world would yell “comm’on down” to the next contestant. She or he would scream in delight as they nearly tripped down the aisle and on to the stage, at times apoplectic with tears. Of course, this was all prelude to vying for the “deal of a lifetime”. Well, there have been times over the last few months when I have felt that “Bob Barker” urge to purchase the latest wine deal of a lifetime. It may have come from a local retailer or across my on line screen. Not a day ends without at least one or two of these “deals” scrolling across my screen….and they are convincing! It’s just amazing how many wines are competing for my palate and credit card. (To my wife’s chagrin, I have had a few weak moments during which I have relented and pulled the trigger……nothing bank breaking…… ……just….well you know….some truly good deals…… really dear!)

All of this is just another example of the dysfunctional economic times in which we live; retailers of all categories vying for what dollars and cents remain in consumer pockets. How deep the discounts may go in the retail wine market is yet unknown. While I have seen discounts on wine prices of between 20% and 40%, I received one on line the other day for 50%. Compare these discounts with the haircut that so many equities have taken since the summer, not to mention the free fall in the price of a barrel of oil (down to $36/barrel from the $147 last summer) and you understand that we may still have some distance to drop in the fair value of the high and intermediate priced wine market. Now to be fair, remember that each producer bottles a fixed amount of wine for given vintage. This supply then attempts to satisfy the demand. With the supply relatively static, pricing eventually falls to the demand side. If a producer offers only a small inventory for a given vintage and the wine is a highly collectible one, the pricing may not suffer as much as one that is in abundant supply. The equity markets and the commodity markets (i.e., oil), on the other hand, can easily alter supply, either offering secondary offerings or drilling new oil respectively. A vintner, on the other hand, can’t go back and harvest and issue more wine of a given vintage (unless some from that year is withheld in their cellars). Anyway, you get the point. It may be a far reaching extrapolation to expect wine prices to parallel the equity markets precipitous fall but we shall see…. Remember as well, the purchase of wine, is a discretionary want and, in most cases, not a need. As these discretionary funds have dwindled, we have witnessed their impact in both the art and wine auction markets with expected bids far beneath what was projected six months ago…sometimes 50% less. And in some cases, I have read of lots of wine or art work going unsold. Yes….these are extreme times.