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yes and no. big difference being that the houses were purchased with highly leveraged funds, and with the pure intention of turning a profit.

unless i'm mistaken, these bottles need to be paid for in full at auction end, so at the very end the owner still owns something. the asset may be over-valued, but you own it. in the case of the housing bubble, nobody but the banks owned anything.

i definitely think there's a huge bubble, and we may see some correction. but i doubt we will see a massive implosion unless the very wealthy buyers of these wines go completely bankrupt, along with the next 1,000 extremely wealthy people standing a line right behind them who were just outbid.
Jorge, my point is the prices are at the point where the "next 1,000 extremely wealthy people standing a line right behind them who were just outbid" are no longer there. The prices are going up to the point where there are no buyers, like housing. The fact that houses were purchased with leveraged funds was irrelevant until they ran out of buyers to flip to. At some point the same thing will happen here. The cellars will fill up and there wont be any more buyers at that price point.

There is no rationalization in auction prices any longer. If that spreads to retail a collapse will soon follow.

Here is an example from last weekend in Chicago. I went to the HDH live auction. I had my eye on a couple of lots. I did my researcher before hand and had extensive notes on avg auction prices, what they were going for at retail, ect. A 2 bottle lot of 1985 Krug went for $950, not including the 20% buyers premium. There are bottles on wine searcher for well under $350. I was sitting at the table next to the guy who won and every time he raised his paddle I had to resist the urge to reach over and slap it out of his hand.

I buy some really expensive wine. Im not bragging, but I do. I buy more expensive wine than anyone I know except some of people on this board. I am now priced out of Lafite and the rest of the first growths arent far behind. Eventually the Asian market will find the next cool thing and prices will plummet.
Hi All.

I am a regular reader of the forums, even though I don't participate often.

I am always interested in 1st growth for my collection. If any of you are interested in selling you can reach me at WineJones at Gmail.com

send me your list and price. I don't believe in the auction values, but I have no problem paying fair market for well stored bottles. I figure that most of you walk the walk as much as talk the talk.

I look forward to hearing from you.
quote:
Originally posted by jburman82:
Jorge, my point is the prices are at the point where the "next 1,000 extremely wealthy people standing a line right behind them who were just outbid" are no longer there. The prices are going up to the point where there are no buyers, like housing. The fact that houses were purchased with leveraged funds was irrelevant until they ran out of buyers to flip to. At some point the same thing will happen here. The cellars will fill up and there wont be any more buyers at that price point.

There is no rationalization in auction prices any longer. If that spreads to retail a collapse will soon follow.

Here is an example from last weekend in Chicago. I went to the HDH live auction. I had my eye on a couple of lots. I did my researcher before hand and had extensive notes on avg auction prices, what they were going for at retail, ect. A 2 bottle lot of 1985 Krug went for $950, not including the 20% buyers premium. There are bottles on wine searcher for well under $350. I was sitting at the table next to the guy who won and every time he raised his paddle I had to resist the urge to reach over and slap it out of his hand.

I buy some really expensive wine. Im not bragging, but I do. I buy more expensive wine than anyone I know except some of people on this board. I am now priced out of Lafite and the rest of the first growths arent far behind. Eventually the Asian market will find the next cool thing and prices will plummet.


but that's the thing, from what i'm gathering, there are still plenty of people willing to pay the high prices. the Krug auction only got to $950 because there was someone right behind him willing to pay $900.

i don't think there's any argument that prices are extremely high, but at this point in time, the demand continues to exist.

like theweb said, so many markets are growing so rapidly around the world, that i just don't see a slowdown. China's GDP was considered "sluggish" this last reported quarter with just under 10% growth, India grew just under 7% during the "global economic meltdown" of 2009, and Brazil is a sleeping dragon.

a lot more people are able to play in the wine market now at a level where prices don't matter, and that's what drives things completely out of wack.

what i'm truly curious about, and completely clueless, is whether or not the people buying these wines are buying them to flip, or buying them because they have boatloads of money and are just collecting trophies / something nice to make sangria with.

if the people buying these wines are "investing" in them, then i can see a pretty big collapse, but from what i've read, the buyers are just rich people who don't care. they're buying wine as a luxury, not as an investment. if they can flip it a year later, great, if they can't then they'll just drink it up and not care less.

either way, totally sucks... all i can afford now are the yellowtail replicas

btw, working on heat tix for saturday....
I made some inquiries today and have commissioned a high end picture framer to design an ornate wall mounted picture frame that will hold a bottle of lafite in the centre of the frame, held by almost invisible twine.

I'm going to hang it in my cellar - I've always said fine wine is in the same category as fine art, so might as well have Lafite art on my wall Smile
quote:
Originally posted by WineJones1:
Hi All.

I am a regular reader of the forums, even though I don't participate often.

I am always interested in 1st growth for my collection. If any of you are interested in selling you can reach me at WineJones at Gmail.com

send me your list and price. I don't believe in the auction values, but I have no problem paying fair market for well stored bottles. I figure that most of you walk the walk as much as talk the talk.

I look forward to hearing from you.


Based on the article (and if my conversion factor of 1.6 $ to pound is correct) a bottle of 00 Lafite would be selling for about $12k Eek! that would get my attention. Otherwise, I will hang on to the few that I have and enjoy them myself someday. Welcome to the forums.

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