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.