Vol 2 No 21…what’s in a rating?

Readers here know that TB has little or no use for ratings or wine snobs. Here’s why:

  1. a rating is simply someone else’s opinion of a wine…it doesn’t mean either you or your friends will like it and that means you may be throwing money away or at least spending way more than you need to. The cost is exacerbated by the ratings themselves with the goal to get at least a 90! Can anyone explain the difference to TB of an 89 versus a 90 point wine…because I couldn’t give you a clue.
  2. Prior to the late 1970’s ratings were not used except in professional tastings, and the primary one was the UC Davis 20-point system. Then came attorney, Robert Parker who decided there was too much compression in the ratings so he developed the 100 point system that he posited was easier to understand since it is the way the grading system in school works. That was fine when there was just ONE rater using it. Now there are at least a dozen and possibly double that number or more. Some of them are not independent or are compensated in one way or another for the rating. The stupidity is as one wine shop owner quipped: I can sell all the 90-point wines I have but can’t get them, but can’t sell the 89-point wines I have in stock.
  3. Looking inside the 100-point system you find the following: 50 of those points are a ‘given’. Plonk rates a 50! So why confuse things with that many extra points. Then there are categories for color, clarity, nose, and more with – get this…25 points that can be added to the score. Wow…so one judge might give it a 75 and another 100??? I am exaggerating the differences but you get the point (sic).
  4. One well-known early wine writer, Gerald Boyd, I believe, once wrote why would you buy a wine just because I like it IF you don’t know what I look for in a wine. Fair question, because many accept a rating without questioning and I can tell you I have had many 90 point or higher wines that, not only did I not find astounding, but guests at dinners failed to comment on. Nowadays, at $90 or more a bottle, that is throwing money ‘down the drain.’
  5. What prompted this post? After all, TB has discussed ratings before, including the 10-point system devised by another blogger who boasts of never paying more than $20 for a bottle of wine. Hence, he ‘deducts’ points for prices above $10 and adds points for cheaper ones. So let’s say two wines both end up with ‘7.5’. Which would you prefer? Dunno, but I do know that looking for value and a complex wine are not mutually inclusive.  It is a totally irrelevant system. It is like saying a Ford is as good as a BMW, adjusted for price…really? To whom? To someone you wouldn’t listen to! It began with an article called A Mathematical Approach to the Judgment of Paris, by David Morrison in (The Academic Wino) blog.
  6. Morrison begins with the scores of the Stag’s Leap Wine Cellars Cabernet Sauvignon. “Its scores (out of 20) were: 10, 13, 14, 14, 14, 14, 14, 15, 15, 16, and 16.5. This means that the wine was judged to vary from Passable (10) to Very Good (16). More to the point, only three of the judges ranked it as their best wine of the day, whereas no less than five of them ranked the Château Montrose wine as their best, although it ranked second based on its average score.” If memory serves, the 11 judges tasted twice, the second time reversing the order, which no doubt led to the wide range of scores. This has been proven in the past and note that even for an experienced taster, the lingering taste of the prior wine can affect the score. Also, note that the point of the tasting was never to prove which area produced the best wine but that California wines could stand up to French wines. Trying to be fair, the tried to pick a vintage which would allow both wines to have matured, difficult since American wines due to higher alcohol (and perhaps more time in tannic French oak?). So they settled on what made them as equal as possible, at that time. Every year since , the  tasting has been replicated with  varying results proving that BOTH countries produce  great wines that mature at different times. Jancis Robinson wrote a great book, Vintage Wine Charts, which you can usually find for a couple of bucks on line. Incredible value. She has dozens of wines in it that she has tasted every year and shows them graphically so you can see where they plateau, sometimes dip for a couple of years, then eventually peak – some in five years or less, some in 30 or more. That is the test of a great wine. A good way to replicate this is with a case of a good wine. Have one bottle, or two a year, about six months apart and see when it tastes the best. When it has ‘peaked’, drink up!

In conclusion, there is only one wine critic that matters: you! If you don’t like it, you aren’t going to care if Parker, The Wine Enthusiast, or any other critic says…on the other hand, if you wish to be a wine snob, that is your prerogative too. But you are wasting your money. If you like Two Buck Chuck (which TB happens to find repulsive), so be it…or any number of cheap wines…including ‘pop’ wines. But try to take one night a week and try something new…that is a good goal. I would say that for most people you should be able to get a high quality wine for $30 or less…and anything over $50 is likely due to the rating – unless you have tried it and found it absolutely thrilling.

That’s my opinion…go get your own! Just enjoy your wine, whatever it may be!

TB

 

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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

3 thoughts on “Vol 2 No 21…what’s in a rating?”

  1. I am a big fan of this article, Bill. I have yet to read your others, but imagine (based on the tone of your blog) that I will enjoy them as well. I’m new to the blog scene, but not new to wine. I work in retail alcohol sales, and find the rating systems to be often flawed when selecting wines; I also have no time for snobbery. This article is filled with very solid points.

    Like

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