The financial markets have been hit hard by the recent subprime mortgage crisis, but it has not been confined solely to that sector. Even the wine industry has been negatively affected to a great degree.
Consumers simply have less money to spend on wines. Large corporations that normally would spend lavishly on office parties and customer entertainment by purchasing the most expensive bottles of wine now find themselves teetering on the edge of bankruptcy.
Without those sales, what is a premium winery to do? Screeching Falcon, best known for its wines that cost thousands of dollars per bottle even on release, found out yesterday. With sales way down, they had no choice but to either ask the Federal Government to bail them out, or go bankrupt. The only way they could continue to fetch the normal $5,700 per bottle price of their wines was to have the government subsidize it.
The agreement worked out with the Feds calls for the United States BATF to purchase all remaining stock of Screeching Falcon wines at a discounted price of $5,650 per bottle. That will allow Falcon to remain in business and operate their web site so that customers on their mailing list will be assured of receiving their precious bottles of next year's vintage uninterrupted.
The other option considered by the Feds was to guarantee the resale value of the wine, akin to FDIC insurance. However, after extended discussion with representatives from both the winery and the Fed, it was decided instead for the federal government to purchase the wine stocks and thus prop up Screeching Falcon to prevent it from suffering financial disaster.
What is going to happen to the wines after being purchased by the government? They are not talking, although this reporter is investigating rumors that bottles of Screeching Falcon have been seen in various 99 Cent Only locations that have a license to sell alcohol. When we find out more, you will find out more.
When asked for their comments on this situation, both John McCain and Barack Obama were in agreement, something that has been very rare during this presidential election year. Both stated, "My position is that which will get me the most votes from the American people."