Log In / Join Now

The Stock Market and Birthday Wishes

Posted: Sep 30, 2008 12:55pm ET

I am recovering from three days of birthday celebrations at my house in Tuscany. I celebrated my 50th. Yes, I am a half of a century old now. I drank a number of 1958s and I have to say that I think I am aging better than any of them, except for the 1958 Sandeman Vintage Port. (It is much better than what I rated in my book, Vintage Port, back in 1989. 90 points, non-blind, on Sunday night.)

But 1958 was never a great year for wine in general – much better for humans. There are exceptions in 1958. I still remember bottles of 1958 Beaulieu Vineyard Cabernet Sauvignon Napa Valley Georges de Latour Private Reserve that I drank with my father about two decades ago. It was as good as many first growths from 1959 or 1961. My dad had bought a lot of the BV 1958 in the 1960s when he was in wine collecting mode in Los Angeles.

This weekend I had at dinner friends from all over the world including Canada, United States, China, United Kingdom, France, Germany, Australia and, of course Italy. I missed a number of friends from Mexico! But the 40 or so of us had some great food and wine including double magnums of 1990 Paolo Scavino Barolo Bric dël Fiasc, 1997 Altesino Brunello di Montalcino Montosoli, 1998 Tenuta San Guido Bolgheri-Sassicaia Sassicaia, 1998 Château L'Église Clinet Pomerol, and 1978 Château Cheval-Blanc. Tuscany’s top chef Francesco Berardinelli, who has been working in Paris with super chef Alain Ducasse until recently, cooked the dinner.

Obviously, apart from all the kudos and kind words from my friends, we also spoke a lot about the current economic crisis in the United States and the world. Everyone agreed, including a handful of top wine merchants and wine producers in Italy and France who were there, that prices are going to come down, especially on high-end blue chip names such as first growths, California cults and super Tuscans. Prices just have to go down as stocks, currencies and real estate take a beating.

The problem is that a lot of people bought those wines without any intention of ever drinking them. So it’s hard to have a lot of sympathy for them. It’s like the speculators who lost their shorts in the sub-prime.

Moreover, a lot of the new vintages of blue chip wines were bought as some people’s diversification of investment portfolios. Lots of young vintages of top name Bordeaux are apparently coming on the market right now. Or at least, they are trying to sell them to wine merchants. I heard about hundreds of stock brokers a few years back in London and New York who took part of their six figure bonuses and bought “investment-grade wines.” I wonder what they are going to do now with their wines, since many of them no longer have jobs, or their stocks are worth very little? They're going to sell the wines.

This is a terrible situation at the moment with the global economy. I hope we are not badly hurt. But the value of wine, particularly collectible bottles, has to go down. I heard one highly regarded vintner in Bordeaux say he expected first growths to go down as much as 40 percent in value.

I am listening to CNBC as I write this. The economic drama continues and we are all going to be on edge for a while – perhaps a long time. But don’t be too upset if you invested in wine. The only thing I can say to any of you who have wine investments is that the worse-case scenario is investing in a good cork screw if things really go to hell.

Karl Mark
Geneva, IL. —  September 30, 2008 3:30pm ET
Wine prices may come down, but the people who are actually buying these wines to drink also have less cash to spend on wine, and more options than before. Producers who have been fair with pricing over the last few years will be rewarded because I believe that brand loyalty has been tested over these last few years....Oh, and happy birthday.
Ken Koonce
Dallas, Texas —  September 30, 2008 3:38pm ET
Happy 50th! I'm so glad I buy wine to actually drink it. It's easier to time drinking windows than markets!
Jeffrey Ghi
New York —  September 30, 2008 4:14pm ET
"The only thing I can say to any of you who have wine investments is that the worse-case scenario is investing in a good cork screw if things really go to hell."

Rest assured, Bacchus and I shall fully enjoy every last drop. Can you imagine chewing on stock certs? At least you'd get the fiber =)...
Gilberto Salinas
Tijuana,Baja Califronia, Mexico —  September 30, 2008 5:33pm ET
Felices "50" - estimado James....Tu amigo, Gilberto - Tijuana,Baja California, Mexico
Lisa Ruyter
Vienna Austria —  September 30, 2008 5:39pm ET
Happy Birthday James! Sounds like a nice celebration. I had a big one this year too...spooky, the things going on now. I keep catching myself holding my breath.
Harold A Graziano
Charlotte, NC —  September 30, 2008 6:18pm ET
Happy Birthday James- As a guy who has a wine room (and many great memories) full of your recommendations/ratings, I wish you 50 more years of clear thought and superb tastings...God's richest blessings to you and all you hold dear.
Miguel Lecuona
Austin, TX —  September 30, 2008 8:21pm ET
James we are on the same wavelength. It's amazing that the news from the USA is so closely followed here in Bordeaux -- the financial situation, elections, congressional action. I think the Plan that was rejected in Congress on Monday was maybe not the ideal or best plan for the situation, and that other ideas can now come forth since the politics have been somewhat exposed. (ie, just raising the cap on FDIC Insured balances will help people believe their money is still safe, and that will stabilize the banking sector). The market's big rebound today is a hopeful indicator.

More interesting will be the impact on prices as the Euro adjusts downward vs the Dollar from it's peak -- two months ago it was $1.57, now $1.40. I see bottles of 2004 Lafite here for 450EU. So I'm not sure that "prices will go down" can apply universally -- but I think that some imbalances will correct in a few markets.

Last point -- Hong Kong and Macau (sp?) both have 0% duty on wine -- they will buy on the dips there, and that will serve to prop up some price levels.

Would love to see you in BDX next time you're coming thru.
Miguel Lecuona
Austin, TX —  September 30, 2008 8:22pm ET
PS - Happy Birthday!
James Peterson
San Antonio, Texas —  September 30, 2008 8:50pm ET
Happy Birthday. I can sympathize with the ''not a great year'' having been born in 1963. Regarding one of the wines you drank, I have a magnum of the 1997 Altesino Brunello Montosoli I bought when visiting Montalcino in 2002 (and had a very nice tasting visit at Altesino too, although they were sold out of the Montosoli -- no doubt thanks to your rating). So how is it holding up? Does your 98-point rating still stand? What was it like six years later? Enquiring minds, especially mine, want to know. Please. Thanks. - Jim
Bob Golbahar
Los Angeles —  September 30, 2008 9:21pm ET
James,you don't look a day over 40!! It's all the wine you drink (2 glasses a night) that keeps you looking young. Happy Birthday. With many more celebrations.....
B Vedaa
September 30, 2008 11:17pm ET
Birthday Boy! Can you share some of Chef Berardinelli's food pairings, particularly for the Italian juice? My girlfriend and I had the '97 Altesino Montosoli with her lobster cuisine and unfortunately, it wasn't the best pairing for my palate. The wine was excellent, the lobster delicious, but together, hmmmm, not so much.HAPPY BIRTHDAY!! -Jennifer
Matt Scott
Honolulu HI —  October 1, 2008 12:33am ET
Happy 50th James! I have a hard time feeling empathy for the "investors" who so kindly helped to raise the prices of these special wines in the first place.
Albert Jochems
The Netherlands —  October 1, 2008 4:01am ET
Happy birthday James!
I'm glad I decided to go for a solid structured wine investment with some real security. Apart from the occasional corked or cooked bottle I'm still making a wonderful ROI on my cellar.
Thanks to my AAA-rated cork screw!
Maynard James Keenan
page Springs, az —  October 1, 2008 11:30am ET
First one to go is my 1951 Penfolds Grange, Then the 52, then the 53, etc... Peter Gago maintains that the '53 is still holding up well. We may soon find out first hand.
Mark Reinman
NJ —  October 1, 2008 12:25pm ET
Happy Birthday, James! Do you think prices will ever return to "futures" level for those of us who were priced out of some of the first and second (and third, and fourth!) growths after they were released?
James Suckling
 —  October 1, 2008 12:38pm ET
Stranger things have happened...700 billion dollar bailouts, sub-prime meltdown, Lehman Brothers bankrupt...wait and see.
Jeremy Matouk
Port of Spain, Trinidad —  October 1, 2008 3:21pm ET
Happy 50th James. Had mine in January this year - some Chanson Gevrey Chambertin and Pio Cesare Barolo over a fine dinner at Prime in Port of Spain.50 is nothing to get too sentimental about, probably the best mixture of health, wisdom and wealth, if one looks at it philosophically. At least so far, that is.Wishing you many more great vintages!
Rosanne Quagliata
October 1, 2008 5:45pm ET
James asked me to post the dinner menu with the order of the wines as well as the food.

1958 Latour -- magnum

Pappa Pomodoro served with panfried scampi and arugla

1990 Paolo Scavino Barolo Bric d¿Fiasc -- double magnum

1997 Altesino Brunello di Montalcino Montosoli -- double magnum

Homemade Maccheroni and rabbit and black olive ragout

1998 Tenuta San Guido Bolgheri-Sassicaia Sassicaia -- double magnum

1998 Ch¿au L'¿lise Clinet Pomerol -- double magnum

Roast pigeon, Rosemary mash and gallinacci mushrooms

1978 Ch¿au Cheval-Blanc -- double magnum

Coffee gelato

Chocolate Mousse Cake

1958 Sandeman Vintage Porto

Sarah Warner
Los ANgeles —  October 1, 2008 9:07pm ET
Happy Birthday, James! Are you coming to LA soon? If so, where's the party? You must celebrate on the left coast here. Let us know, we'll bring some gems!All the best,Sarah WarnerJarvis Communications (of Dalla Terra Winery Direct, importer of Casanova di Neri--your fave!)
Karl Mark
Geneva, IL. —  October 2, 2008 10:07am ET
James have you heard any additional information from Bordeaux concerning the harvest conditions? Looks like they have had good weather most of September.
Caleb Smith
Lake Placid NY —  October 2, 2008 11:03am ET
Happy Birthday James! I really think that the greatest purpose of a cellar is to enjoy it and distract us from times like these. Wine can transport us to another world and thats why I love it!
James Suckling
 —  October 2, 2008 11:36am ET
Thank you all!
James Suckling
 —  October 2, 2008 11:38am ET
Karl. I have heard that the good weather is holding out. Bordeaux was going to have a pretty bad harvest until the good weather came in September, but I think it is too late to produce something outstanding. Nonetheless, there should be some very good wines from the top estates. We will see...
Thomas Hughes
Texas —  October 2, 2008 11:39am ET
Wine investing is not different from any other type of investment, it takes time to reap the rewards. People who speculated with internet stocks in the late '90s, housing in 2004, and commodities in 2008 think that their particular markets only go up. They lose most of their investments because of greed. Wine is different because it can be consumed. This means that every time one of us open a 1997 Brunello, that's one less bottle available to buy (reducing the overall supply). So wine prices may decrease in value temporarily due to a slowing global economy, but it will not last for long, because every year the supply for great years decrease and new consumers come of age that want to try this amazing product that brings so much joy to our lives. "Wine is constant proof that God loves us and loves to see us happy." -- Ben Franklin.So the economy and markets are slowing, all the more reason to open up a good bottle of wine that you were saving for a special occassion, invite some friends and family over to enjoy it. Life is too short, either get busy living or get busy dying!!T
Steven Balavender
Tampa, Fl —  October 2, 2008 8:01pm ET
The drop in the GLOBAL economy must have producers very concerned as it is inevitable that many wine merchants are going to have a very rough time weathering this storm......shops are going to be cutting their buying drastically as credit has vanished. China has all but disappeared.
Dr Evan Gold
Needham, MA —  October 3, 2008 3:46pm ET
Happy Birthday! I'm turning 50 myself in a few weeks and have to decide what to drink. I'm going to an inn, Twin Farms in Vermont and hope to raid there 26,000 bottle wine cellar for something special.

Would you like to comment? Want to join or start a discussion?

Become a WineSpectator.com member and you can!
To protect the quality of our conversations, only members may submit comments. Member benefits include access to more than 315,000 reviews in our Wine Ratings Search; a first look at ratings in our Insider, Advance and Tasting Highlights; Value Wines; the Personal Wine List/My Cellar tool, hundreds of wine-friendly recipes and more.

WineRatings+ app: Download now for 340,000+ ratings.