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The Cost of a Bottle of Wine With The Euro @1.54...


Joe H
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I've simultaneously put this on CH but I think it is a very important discussion that I would like to hear others' opinions on.

I drink a lot...of wine. Over the years I've built something of a cellar with almost one thousand bottles now. My neighbors insist that if the world is coming to an end they are all coming to my house since I have enough wine to drink the entire neighborhood into blearly eyed oblivion-happily! Still, I enjoy wine a great deal. It is a pleasure, an indulgence and a shared moment with friends and with clients who become friends.

Over the years the cost of indulging my passion for wine has become increasingly more expensive with first, the introduction of the Euro and later, the depreciation of the US Dollar vs. the Euro. I've travelled on business in Europe for many years and have consistently brought back 8 to 12 bottles or more on each trip. I once had to open my suitcases at Washington's Dulles Airport when a hungry beagle sniffed my Chianti laced salami revealing to the inspectors a total of 18 bottles of serious Super Tuscans, Reserve Chianti and Amarone. They reacted as if I was a wino and, for me, that was fine since they laughed and only confiscated the salami not the wine. (Over time I've grown to know the beagle; today he is a friend. I've learned to applaud his good taste and sense of smell for what I am certain is his eventual dinner. I can only be thankful that his handler never introduced him to wine. The beagle would then be a complete gourmand!) Prior to the Euro when wine was priced in Lira, Francs, D marks, etc. a bottle purchased in Europe was generally half the eventual U. S. price when sold here. (I remember Solaia at 120,000 Lira with the exchange rate putting this at $60 or so!) With the switch to the Euro this changed, sometimes dramatically, but it was still cheaper to buy the same bottle of wine in Europe than in the U. S.

That is no longer true today. With most importers buying futures (does anyone reading this remember when Costco bought 2000 bordeaux futures and sold those wines at the second futures' price?) the wine that we see in a store, shop or wholesale club today is wine that was purchased with the Euro considerably lower than it is today. Americans' first introduction to the weakening of the dollar for a wine drinker was with the pricing of 2005 bordeaux which was/is through the roof. Please note that much of that seemingly exhorbitant pricing was with a dollar in the low $1.40 range.

I can offset the disproportionately expensive Euro by buying Australian, Chilean, New Zealand, Argentinian, etc. Except that the Australian, New Zealand and Canadian dollars are all at either 100+ year highs to the US dollar or close to it. I'm not certain how much longer Chilean, Argentinian-even South African wine will continue to be a bargain.

Ideally this could be offset by buying wine from California, Washington and Oregon except that all of these are going to be more expensive with winemakers believing that the market will tolerate their incrimentally higher prices with the other alternatives (read everywhere else in the world!) being disproportionately more expensive.

Summarily, we are entering a time when many of the things we have taken for granted are going to challenge what we are able to afford. Whether arborio from south of Verona or Biella, epoisses from France, Jamon Serrano or wine from Jumilla-it is all becoming increasingly more expensive.

I wonder if those who are reading this understand that we are approaching a time when that which we love to eat or drink may no longer be affordable to many of us. Not a political comment but a practical comment: the continually weakening U. S. dollar is going to have a significant impact in our pockets if we want to continue our love for wine and the food which we import.

Of course the current administration will suggest that those in Italy/France/Spain will drink more American (i.e. California/Washington/Oregon) wine since we now have such a price advantage. Having spent a few days overseas recently I know this is simply not true. Someone in Tuscany, in Provence, in Jumilla could care less about Napa or the Alexander or Walla Walla Valleys-if they could even find their wine there. The real loss is to us, here, who drink wine from overseas that we have grown to love which now has literally doubled in price over just the past few years.

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The best buying strategy right now is to find wines with as few middlemen in the way as possible. In DC, this means buying wines that have been directly imported by the store. The "official" three tier system only makes the problem of the weak dollar worse. Small local imorter/distributors offer the best prices in stores and restaurants today. Look for wines imported by Vinifrance Inc.,Simon N Cellars, Elite Wines, Roanoke Valley Wine Company, Kysela. They buy direct from the source.

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As I type this I would "kill" for an exchange rate of 1.54. Currently it is approaching 1.57!!!! Unbelievable how anyone can make any money is an environment like this.

Here's how it works in an "environment like this": Boeing is making money selling jets to China, Chevrolet is making money selling crappy American cars in Romania. Apparently, we, here, don't really matter anymore in the scheme of things.

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The CEO of Caterpillar was on CNBC several weeks ago. Maria Bartiromo interviewed him and suggested that Caterpillar must be doing extremely well with the "weak" American dollar and the ability to sell overseas. He simply said that it didn't make any difference to Caterpillar. They had a plant in India and another plant under construction in China and it was irrelevant that the American dollar was weak.

An American company.

We're all getting screwed badly by this. More than likely Chevrolet has a plant under construction in Romania and Boeing outsources engineering to India and subcontracts to Malaysia....

To the best of my knowledge I've never had a decent red from Kuala Lampur.

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The CEO of Caterpillar was on CNBC several weeks ago. Maria Bartiromo interviewed him and suggested that Caterpillar must be doing extremely well with the "weak" American dollar and the ability to sell overseas. He simply said that it didn't make any difference to Caterpillar. They had a plant in India and another plant under construction in China and it was irrelevant that the American dollar was weak.

An American company.

We're all getting screwed badly by this. More than likely Chevrolet has a plant under construction in Romania and Boeing outsources engineering to India and subcontracts to Malaysia....

To the best of my knowledge I've never had a decent red from Kuala Lampur.

If I thought George W. Bush was the architecht of this, I'd say thank him, but I'm 100% sure he's not. He's just the happy face on TV telling us about it. The Republicans have figured out a way to let big business run the world economy and this country at the same time. The tip-off was a few months ago when I went on the Metro here in Washington and was called by the creepy recorded voice a "customer". I am no longer a rider or passenger on the Metro. I'm a customer. Period. End of story. Colonize Mars please, soon.

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The tip-off was a few months ago when I went on the Metro here in Washington and was called by the creepy recorded voice a "customer".

You'll know that it's gotten REALLY bad, when the Metro's recorded voice has an Indian accent. They're outsourcing everything these days.

Here's my fantasy:

(sound of phone being dialed) <ring-ring-ring> clickety-clickety-clickety

(sound of male voice with thick Indian accent)

"Yes. Hello. This is the suicide hotline. Customer service. My name is John. It seems that you are wanting to take your own life. So, how can I assist you today?" ;)

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