Bailout 2007 is a wine that's fermenting in oak barrels at Crushpad, a custom winemaking operation in San Francisco. But you can pre-order the Bailout 2007 now and receive a stimulus check of sorts if the stock market sours.
Here's how the Bailout 2007 buying plan works: You pay $39 per bottle of Bailout 2007, and the closing value of the Dow Jones Industrial Average is pegged on that day of purchase. When the wine is bottled on Aug. 14, 2009, the Dow's closing value will be noted. The difference between the Dow from the date of purchase to bottling will be tallied, and customers will receive $2 for every 100-point drop in the Dow.
Think of it this way: If the Dow was at 8,800 on the day you bought Bailout 2007, but dropped to 7,300 by the end of Aug. 14, Crushpad will cut you a "stimulus check" for $30. That $39 bottle would ultimately cost the consumer $9.
Even if the Dow increases during this time, customers won't be charged more than $39 per bottle. Crushpad brands its Bailout 2007 as "Napa's answer to, 'Dude Where's my 401(k)?'"
"It's a good deal either way, and might even turn into a really good deal," says Noah Dorrance, the marketing director for Crushpad. "We're hopeful that we won't have to send big checks to people in August, but we wanted to have fun with this. It's a good and topical (selling approach) with all the bailouts happening."
But besides the prospect of a potential bargain, why plunk down money for a wine that's not blended or bottled yet?
The concept of purchasing pre-arrival wines -- better known as "futures" in the wine industry -- is a staple of French producers from Bordeaux and other regions, but not common with California winemakers.
Buyers of wine futures are typically serious wine collectors and investors looking to get the best prices on bottles. The wine producer sets the futures price, which is typically the cheapest fetching price for a fine wine. By the time a wine has passed through brokers, importers, wholesalers and retailers, that price will inflate significantly. That's why futures can be a relative steal.
"Depending on the hoopla of a vintage, and economics, I've seen wines more than double or triple (from its futures price)," says Elizabeth Grubel, director of wine buying for Vinfolio, an online wine merchant and collectors services company. "But many times you have to put 100 percent of your money upfront and you might not get your wine for a year and a half. I can't stress enough that if you want to start doing this, work with a reliable and trustworthy retailer."
The Bailout 2007 grapes are sourced from some prime spots in the Napa Valley, including vineyards on Pritchard Hill and sources near Oakville, Calif. But the finished product is still a ways off, with blending scheduled for the spring.
About 550 bottles of Bailout 2007 futures have already been sold, which represents two barrels of wine. And speaking of barrels, these containers are also part of Bailout 2007's marketing plan -- but in a way that connotes the money-strapped masses instead of fermenting.
"We had a guy wearing a barrel and handing out (2007 Bailout) cards in the financial district in Union Square," says Crushpad's Dorrance, about one recent marketing strategy. "Soon enough we may all be wearing one."
E-mail Chris Macias at cmacias(at)sacbee.com
(Distributed by Scripps Howard News Service, www.scrippsnews.com.)
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