Why Futo is a Buy

This month, about 800 lucky individuals were given the opportunity to buy 3-bottle cases of Futo, the new cult-wannabe from CA, for merely $600. Yes it costs too much. A good friend of mine, who has been on the Sreaming Eagle allocation list (and others) since inception, confided in me that "almost none of these wines are worth what you pay for them."

I bought it, because the speculator in me thinks that this wine is a good bet - to rise in value. The wine has not been reviewed yet, so the true market price is anyone's guess. But how bad does it have to be to stay at $200? The makers of Futo, Abreu and Aubert, both have impressive track records - and they have experience making wine together. Consider their last joint venture, Sloan, had a 92+ (RP) for their premier vintage (2000) today's price: $255. Now, I need to assess what are the odds that Futo (2005) can beat 92+? The winemakers have 5 years more experience than when they made Slaon, and the vineyard is next to Harlan. It could be a bust, but I'm in.

1982 Grand Puy Lacoste

Given the high prices of the 1982 first growths, it may make sense to pursue some of the other 1982 Bordeaux. Last night, I opened the Grand Puy Lacoste, which has risen from $130 to $160 over the last several years. A more rigorous analysis might show that when valued in constant dollars, the price has changed very little, if at all. This wine had a fabulous nose during the decanting process. After decanting, the wine went back in the (rinsed out) bottle. The '82 Grand Puy Lacoste is at peak maturity now, and does not benefit from extended exposure to air. It does benefit, however, from a slight warming. Cellar temperature (55F) is too cold for this wine. Although many big, high alcohol reds benefit from a bit of cooling, the Grand Puy is not in their league. I warmed the wine by placing my hands around the glass, and felt that it showed better when over 70F (temperatures measured with an infrared laser thermometer from Sears). If you are looking for a full-bodied cabernet from a classic year, then the Grand Puy Lacoste is probably not your wine. It is a classic Pauillac, medium bodied, easy to drink, and yes, graphite on the nose. The secondary flavors of leather and tobacco are present, but not overbearing. This wine is little changed from when I last tasted it 3 years ago.

1982 Bordeaux at Historic Levels

Is it irrational exuberance, or are we at the beginning of a new wine economy?

I started collecting wines in 1998, and I have never seen anything like this. The chart on the right shows the evolution of fair market prices of Chateau Cheval-Blanc and Chateau Mouton Rothschild over the past 10 years. In the late 1990s, I used to buy Mouton at auction on dips, usually at $350. Earlier this year, I (foolishly) passed on several opportunities to buy it at $850.

The chart is beginning to look like a bubble, and I have to wonder what is driving this market? Bubbles can be very difficult to recognize while they are on the upswing, so it comes as no surprise that my gut tells me that the days of sub $1000 Mouton are over. (Buy it! Before it hits $2000!) It may be true. The '82 Bordeaux just passed the 25th anniversary of their harvest, and they are (substantially) at peak maturity now. But before making any impulsive wine investments, consider that the 1961 first growths have not appreciated at nearly the same rate. My impression of today's price for the 1961 Mouton is $2500 (for problem free bottles, mid-shoulder can be had for much less). That represents a 60% increase over its price of $1500 a little less than 10 years ago. Contrast 60% with the 300+% increase of the 1982, and it begins to look as though the younger vintage has some room to the downside. Time will tell, but the rational side of me recognizes that the current rate of appreciation in the 1982 first growth market is unsustainable.