Vol.1 No. 19 …how sad it is…

As mentioned in TB’s last post, it was hard to focus on writing (impossible?) following that awful tonsillectomy. That said, time wasn’t wasted as he read several valuable wine books, and some that he found irritating but good tools of how he did want and did not want to write ‘his’ book. In later posts, I will provide names of the ones I found of value and a brief synopsis.

As one of the authors started out, “why another wine book?” That in itself is a valuable question as most aspects of wine and the industry have already been written abuut, both by ‘experts’ (pseudo-experts?), and those who are very angry…how can one be angry about something that lends to socializing and relaxation to life? Dunno. Who is the best judge of what is good wine? You, the consumer…all that matters is your taste and price range, not what TB or anyone else says. Therefore, while TB might mention a wine he truly likes, he won’t tell you to like it, nor will he EVER accept anything of value for any comments or recommendations – there are far too many that do!

What they are angry about is wine prices! One says “you should never pay more than $20 for a bottle of wine.” Never? Who says? That blogger and now author, who has never (by his own admission) even taken a wine appreciation course, and has devised a ten point rating scale where after HE has tasted it and evaluated it, and then subtracts points for each dollar above ten! This says that economics drives supply and demand, not pleasure. Of course with all those 90 and 95 point scores facing you when you go to purchase, you are influenced by them (or at least until you realize that your tastes might be different from the scorer, be it Robert Parker or some other ‘eggspurt’).  But do you buy a car based on price or on a rating provided by Consumer Reports or a car magazine? Would you buy a house based on price rather than location, location, location?

Winemaker Fred Franzia says, “you should never pay more than $10 for any bottle of wine.” Oh, how special! But who is Fred Franzia? He is the head of Bronco Wines…never heard of them? Then what about Charles Shaw, aka Two-Buck Chuck, the most popular (sic) wine in America? Frankly, if TB was Fred, he might say the same thing, but he isn’t! Just as some critics rate quality, or their definition of it, a growing number of writers and bloggers rate based on price (and some are compensated, either directly or indirectly for their comments), and again, who says that my taste in wine is the same as theirs?

There is a laboratory in Napa where a winemaker can take a sample of his wine and have it analyzed. By chemical analysis and especially phenol’s, they can tell her what she needs to do to make a 90 point wine…guaranteed! …and it works as they have been doing this for well over ten years! So much is this process utilized (some call it ‘chemical soup’), that the number of 90 point wines has gone off the charts…how many times have you seen a wine in a store with an 80 something rating? One store owner even said, “I can’t keep a 90-point wine in stock and I can’t sell a wine with a 88 rating.” If that 90-point only buyer is you, you have become a wine snob…but isn’t just as bad to say ‘never’ pay more than $20 or some other arbitrary number…by the way in 1970’s prices that is about a $5 wine…about what Mondavi, and other major producers were able to get for their wines (if you doubt this, I have bottles with $4.95 price tags on them…one is a Mondavi Cab. I also paid a ‘huge’ $25 a bottle for the Heitz Martha’s Vineyard, which I purchased a case of from Joe when it was released. It was so good I suddenly realized that I was down to ONE bottle! There is one bright side to those high ratings (Robert Parker, who was extremely stingy with his 100-point ratings on a scale he devised or at least made famous, has now give well over one hundred wines a 100-point rating…absolute perfection, and not just a bit of grade escalation): while the 90 plus ratings attract buyers, the awards are not causing the prices to jump as much as before…just bought more.

I held on to that bottle and finally sold it at auction with my Bordeaux wines and a bottle of Screaming Eagle. The Eagle sold for $800 at auction and the Heitz for $400! I couldn’t afford to drink either one, and as then-winemaker at Screaming Eagle, Heidi Barrett said after a Jeroboam of her wine sold at the 2000 Napa Valley Wine Auction for $500,000 (to put that in perspective that equivalent of six bottles worked out to just under $23,000 for a four-ounce glass): “It’s wild. You drink it, and it’s gone. My brain doesn’t get it.” …and if Heidi’s doesn’t, ours shouldn’t even be able to fathom the idea.

This brings us to another conclusion: most wines at even $100 aren’t within the reach of (or desire?), most people. Back in the late 1980’s it was being touted that the Japanese would buy up all the great wine in the world…well, they didn’t since their economy imploded in 1989 and hasn’t recovered since. Then in the documentary Red Obsession, they projected that the Chinese would do it…and like the Japanese their obsession was with only the top first growths from Bordeaux and Burgundy. There was a setback however since much of those purchases were for ‘gifts’ to business associates and to grease the palms of government officials. That put a damper on the price escalation but not enough to stop the top Bordeaux from selling for well over $1,000 a bottle!

But where are these wines going? Again, dunno. But they are being shipped to warehouses where they are traded – much like bitcoins – with no actual deliveries made. Some of these warehouses have sustained losses and at least one went bankrupt…still the prices continue to rise. To TB, it is a toss-up between who is the bigger fool: the bitcoin or the Bordeaux buyer? Meanwhile, the winelover is being cheated by not ever being able to taste these wines.

Back to the anger. In the preface to one wine book, an author who has asserted to teaching more than a thousand wine classes, and even more wine expos, states: “I am beholden to no one in the wine industry. I am a nonlistener to wine talk and a nonbeliever of wine publicists, and I have zero interest in winery owners, winemakers, and their glad-handing gunsels. ‘Shut up and put it in the glass,’ I say. I am difficult, I admit it. But it’s the best way I’ve found to wade through oceans of mediocre wine in my search for pearls.”  You aren’t difficult…you are impossible!

I purposely give no attribution to these two gentlemen, however I am indebted to them for focusing me on what I want MY book to be about: the faces behind the wine.

Contrary to the author cited, I have met dozens of winemakers and wine advocates (not you, Mr. Parker), in the U.S. and Europe. Most of them are hard workers who consider themselves in agriculture, as Joe Heitz told me. Look at their hands…some of the women in the industry have hands and faces weathered by the sun working in something they love. I first had wine when I was six years old! SIX! It was Christmas and it was decided I should have a very small sip of wine…but my dad was pouring and without realizing it filled my glass after I had had my sip. I liked it and soon my uncle saw my eyes rolling in my head and very discretely took me for a walk around the block. From about 18 I tended bar at my other aunt and uncle’s parties. I was fascinated by wine, and later Trader Vic, the greatest mixologist of all time. When I lived in San Francisco I was fortunate enough to meet him….that is where I settled on Trader Bill as a moniker – both for my earlier financial blog and now my wine endeavors (I like it that Trader Joe’s is also on a similar vein and will discuss theirs, Costco’s and now Total Wines in future posts), and  Now that I am 70, I have about 52 years of experience with wine…yet, I would consider myself an advocate…not an expert!

I have long contended that if you taste wine in a setting where you have access to the owner/winemaker, not some twenty-something college student being paid to pour and maybe recite a few lines about the wine and the winery, you will mentally score the wine higher…and that, folks, is a good thing.

That is enough for now, with more on the book in later posts.

Thank you for reading,

TB

©Copyright 2015 TBOW, all rights reserved.

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traderbill

How did Trader Bill originate? It was conceived by me as a way of providing information summaries of global financial markets so that friends and associates could bring themselves up to speed on events and changing market conditions upon their arrival at work. In addition, it provides information on speakers and economic releases that day with consensus estimates and level of last release so that the reader is prepared to react, or knows how the market might react upon the release of information. Who is Trader Bill? Initially any reference to me was as ‘i’. This is to remove the aura of ego and to suggest that i am but a humble reporter, albeit with 35 years of investment experience. Investments are demanding of ego, however, or one would not feel that he was qualified to manage someone else’s money in the first instance. Therefore i needed an ‘alter-ego’. Like Winchell and Mahoney, Edgar Bergen and Charlie McCarthy and especially Trader Vic and Mai Tai’s! Why Trader Vic? Because he was a likeable man who delivered pleasure to his customers and knew exactly what their desires were. The reason for the alter ego became obvious once I introduced Trader Bill into my commentaries: people started asking what Trader Bill thought. They had never asked me what I thought before, but suddenly they wanted to know what TB thought! Now mind you they KNEW that I was Trader Bill but for some reason he became bigger than life. Maybe it was the small ‘I’? What does Trader Bill try to do?His goal is to educate from his years of experience. Consider that most of the traders and people managing investments weren’t even around in 1987 for the crash! Consider that Graham and Dodd, and even Warren Buffet are not relevant to them, too old hat. Their historical perceptions of markets and fundamentals (earnings, price/earnings ratios, bonds, debt service coverage) are irrelevant in this fast moving world. This is the NEW ECONOMY, or is it? How did your style originate?Years ago i found that i had a knack and talent for writing. In addition, i developed an ability to analyze market news about 15 years ago. It took the Crash of ‘87. Prior to that i was just listening to what others said about the economy. But bond yields had been soaring in ‘87 yet the stock market just kept hitting new highs. That was when i began to learn about markets. i have both a dry and witty sense of humor (some call it inane!). Therefore i attempt to make even the worst news somewhat amusing: whether it is the absurdity of an economic release, or the comments of a CEO. This is trading desk humor (or gallows humor). It isn’t politically correct but it does ease tension. Ironically, it is seeing the light at the end of the tunnel (in the Navy they say: it’s always darkest before it’s pitch black!), that allows you to be more objective in your analysis, as bad as a situation is there will still be a tomorrow! You will see that i practice three-dot journalism, a style made famous by San Francisco reporter Herb Caen, whom i idolized. At least to me it is effective. What is so special about your analysis?Frankly, i don’t know that it is special, but at least it beats “the market closed down today on profit taking.” What i do know is that most of what you read is spat out without considering whether or not it is rational, like the above statement. Is it right? Sometimes yes and sometimes no, and that is the key to what is different about my analysis: it is meant to make you think. Is Dan Rather right or is Trader Bill right? If it causes you to stop and think about it, regardless of whether you agree, i win! Because THAT is my goal…not to have you think i am a guru, got that? Bet you never heard that ANYWHERE before in my business! Instead they want you to think just how smart they are but remember in this business if you are right 60% of the time you ARE a genius! Another thing that is different is when i am wrong on an analysis i will tell you, not hope you forget what i said. So now you have the tools to do what the speculators and hedge funds do: challenge authority, and if you make money it is because YOU did it not me. i was just a tool, your flunky to do the grunt work and let you decide…course you could be wrong too but at least you looked at the big picture. But the goal is also to have fun! This shouldn’t be a business of hushed tones and grim faces. It is a living, breathing thing and nowhere else in the world do you have the odds as much in your favor as here. Just beware of the guy who wants to put his arm around you and tell you he is your friend. So there you have it. I hope you select me as one of your sources for market information. If you do I promise to work my best for your financial success. Trader Bill

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