Death, Taxes & Pappy Van Winkle
From Red, White & Bourbon on Sep 14, 2013
This post appears in the Best Bourbon Experiences roundup.
Death, Taxes & Pappy Van Winkle
Yesterday I saw a road that had collapsed under water and a duck floating down the street in front of my house. If that wasn’t enough to confirm that fall has officially arrived in Colorado, I saw pictures of the new Parker’s Heritage and Four Roses Limited Edition Small Batch on Facebook. Buffalo Trace also announced their BTAC will be ready to ship by the end of the month, and that means the cloak and dagger Van Winkle release is surely close behind. Yup, fall is here.
Three things in life are certain: death, taxes, and the fall shotgun blast of high end bourbon. With the first sighting of these bottles, bourbon enthusiasts begin salivating like Pavlov’s dog, but more importantly it indicates the fall bourbon blitz is finally upon us. Ladies and gentlemen, start your engines…or…don’t.
The bourbon bubble has provided plenty of people to run around town searching for these bottles, but the bourbon bubble has also caused a form of “bourbon burnout”. The work needed to get even just one bottle of this year’s releases seems exhausting, which has caused a lot of people to sit out this year's search. Some are abstaining because they are fine drinking whatever is on the shelf, others feel that prices have surpassed a reasonable price point. A rare few have enough stocked away from previous fall releases to make it through the year. I am choosing to sit this year’s hunt out because of a cheery optimism that someday soon, people will stop caring and all of this "hunting" will be for naught.
Of all the bottles that will be searched for this year, Pappy Van Winkle is no doubt the most prized. Pappy might be the most diverse beverage ever, splitting time between a highly enjoyable pour of bourbon, an investment, a status symbol and a classy piece of man-cave art, but it has also increased the popularity of other rare releases. With every new angle bringing consumers to the hunt, the odds of finding a bottle go down and the secondary market prices go up. Right now on the secondary market you are looking at a king’s ransom or a first born child. In some “exchanges,” the only thing missing is a ransom note made from individually clipped letters from a magazine.
So why not try even harder to get a bottle at retail knowing that there will be so much competition this year?
It seems like Pappy Van Winkle, and subsequently the BTAC and the like are going the road of Tickle-Me-Elmo, Crocs, Tamagotchis, iPads and Beanie Babies. These items were impossible to find when they were hot, just like Pappy, Stagg and Saz18 are today, but after their respective bubbles burst, prices and availability began to normalize.
There is no doubt that this bourbon bubble will pop, but ultimately the question is when? When I see people posting pictures of dozen bottle stashes of Stagg Jr, Wild Turkey Forgiven and Black Maple Hill NAS on Facebook, it reminds me of when one bedroom crack dens were selling for $300,000 at the peak of the housing bubble. Unfortunately when the music stopped, all they were left with was a bill for a $300,000 one bedroom crack den.
The housing market was a wild ride, but the buying frenzy created wildly inflated prices. These prices were based on value that never really existed. In our world, people are hitting up liquor stores, buying “special” releases, snapping pictures of the bottles in their car, and selling them before they get home. The buyers don’t see these bottles in their stores, so they assume they are rare. Everything rare must become “rarer” over time and everything rarer must be worth more than rare things so buy everything rare! Right?! Right?
Who knows what the prices will be when this ride ends and there is obviously a lot of money to be made in the mean time, but I encourage you not to be caught holding the one bedroom crack den when the music stops.
At risk of sounding crazy, I believe the end is closer than we think. The buy high, sell higher model has worked for a while now, but eventually the bourbon drinkers will be priced out of the secondary market and the investors and profiteers will be left selling to each other. Then, and only then will prices stop climbing on new releases, which will hopefully thin out the number of people looking for them.
Accepting the fact that life can be lived without a deep stash of high end bourbon, even if the bubble lasts a few years, it should only be considered a mere inconvenience. I mean, consider what might await when the bubble bursts.
A perfect storm could be brewing where bourbon distilleries increase production of their top shelf brands, and in a decade or so when they mature, the bourbon-bandwagon is only left with bourbon drinkers.
We are already starting to see the increased production of special releases with the 8,000 bottle Parker’s Heritage release and this year’s Four Roses LESmB. Even if slightly, other distilleries are doing the same, not to mention the dozens of newly opened distilleries that are producing high quality craft whiskey. Eventually, bourbon will loose its shine. Maybe aged rum, top shelf tequila, or something entirely unrelated to liquor, but something bright and shiny will catch the eye of the bourbon buyers that aren't bourbon drinkers.
You won't be searching liquor store shelves shoulder to shoulder with people only looking for Pappy or Stagg so they can flip it on the secondary market at four times what they just paid. Stores will actually have to create shelf space for the BTAC, the Van Winkle line, Four Roses Limited Editions and the Parker's Heritage Collection. Newcomers to bourbon will only be encouraged to stick around if they enjoy bourbon, not because they see dollar signs. I know, it seems like an alternate universe compared to what today's bourbon market is like but easy come, easy go.