The global economy was rocked and shocked today by an astonishing revelation: the entire French currency system is not backed, as most people thought, by a gold standard, but by a wine standard.
Unlike the United States, in which the value of paper dollars is supported by a gold reserve, the value of French francs is supported by vaults and cellars of wine.
This heretofore little-known fact was brought to light earlier this week by the highly publicized scandal involving a relatively low-level French government employee who managed to squander the equivalent of $7 billion U.S. through ill-timed and unauthorized attempts to profit from wine futures transactions.
Claude DeFaraude was arrested without incident Monday at his modest home outside of Lyon. He is being charged with the largest fraud in French history, a scheme so simple yet one that managed to remain undetected for at least two years.
DeFaraude purchased huge amounts of futures in various wines, among them Screaming Eagle, Italian Super Tuscans, and boutique wineries in California and Oregon that had yet to even bottle their first vintage. He was counting on the value of these wines to show astronomical increases, at which time he would sell his futures stake and realize enormous gains.
It didn’t happen.
He was hit from all sides: The recent subprime mortgage crisis in the United States caused many of the boutique wineries to go out of business prior to issuing their first vintage; the demand for Super Tuscans bottomed out because for many of them, their prices turned out to be the most super aspect of the wines; and it was discovered that Screaming Eagle does not even exist and is in fact a myth.
The value of DeFaraude’s futures went down, not up.
In a mad scramble to cover his losses, the government employee, who had been a low-ranking clerk for four years, sneaked into the National Wine Vaults and removed ten mixed cases of wines from the 2005 vintage produced by the Domaine de la Romanee Conti. The value of these ten cases was approximately $7 billion in U.S. dollars.
Discovery of the theft provoked an uproar within the government. Investigating reporters learned, as a result of their probing, that the National Wine Vaults hold incomprehensible numbers of valuable French wines whose value runs into the trillions of dollars. Petrus, Guigal Cote Rotie, Leroy Burgundies, and hundreds and thousands of other priceless treasures reside within vault walls, all supporting the value of the franc.
Embarrassed officials were at first reticent to even discuss the matter but after much cajoling, admitted that the ten cases of Romanee Conti are gone for good.
“Somehow they wound up in the hands of an American, a Ms. Lindsay Lohan, who apparently has, along with some of her friends, consumed the entire ten cases,” admitted a high-ranking official who requested anonymity.
“The precious, precious liquid is gone,” he sighed. “All that is left are empty bottles tossed from an automobile that are now strewn along the Malibu coastline and in sections of Beverly Hills within the United States of America.”
President Bush, when asked for his reaction to the French fraud at first appeared unaware of the matter but then a look of recognition came to his face. “Yeah, I like ‘em that way,” he said, “but I prefer ‘em mashed or in hash browns.”
On a serious note, I noticed in my Google Analytics today that there have been a few referrals to this site from the Wall Street Journal Online (WSJ.com). The source of the referrals was their recent article on the Budometer, which I mentioned a few posts ago. Unfortunately for those who clicked on the WSJ link, my post was pretty much a rehash of the article so their readers gained nothing new from visiting this site.
But what I wanted to point out was that bloggers are being given recognition by major publications (we knew that, but I thought it was something that they would find tiny little onewineperweek) and links are being placed on their pages.