Deflation

July 06, 2009

Recession Special: Wine Cheaper Than Water!
Published: Monday, 6 Jul 2009 2:52 PM ET
Text Size
By: Cindy PermanWriter
A lot of people are trading down on their meals, cooking at home and eating fast food, amid the recession.
Fill me up, Johnny—Just doing my part to help the economy!
But your culinary luck is about to change: Things are now so bad that you can eat and drink like a king at pauper’s prices!
Remember, we told you that the recession has hit the seafood industry so hard, you can now get lobster at lunch-meat prices on Cape Cod.
Well, pour yourself a glass of vino to go with that lobster tail tonight because wine prices have fallen so much, winemakers in Australia are complaining that wine is now cheaper than some bottled water.
WATER!
Dan Murphy, a major wine-retail chain in Australia, is currently selling cleanskins, bottles of wine without a label that are usually sold in a case, for 1.99 Australian dollars, or about $1.60, the Sunday Mail reports.
That’s less than half of what wine cost 10 years ago, the New York Times reported.
“Australia can’t even bottle air and make money selling at that price,” Jeremy Oliver, an Australian winemaker and critic, is quoted as saying in the Times. “The industry is in crisis.”
It’s so bad that some growers aren’t even picking all of their grapes. And Foster’s, the biggest winemaker in Australia, has already sold about 31 vineyards.
This is a rallying cry, people!
Forget the tea parties, raise your goblet high and say it with me: "We will drink until the last drop of recession has been swallowed!"
As Napolean once said, "In victory, you deserve champagne. In defeat, you need it."
I'll drink to that.
* CLINK! *

Beware of Deflation. Oil plunged today over $2.50 per barrell. While ultimately, the printing of trillions of U.S. dollars will lead to inflation, we first will have to deal with a devastating bout of deflation.

With all that has happened, gold has still not surpassed it's peak reached in February. A lower price below $750 an ounce would make a great entry. We look to that level in the near future.