The Rotgut Economy

Yes, everyone drinks more in a recession, but they drink the cheapest, vilest swill they can find. The New York Times reports while wine sales are up, the industry is hurting because high-end wines are in a tailspin.

Beer too: Sales of Heineken and other mid-market beers are down while the kind of beer you used to drink before wearing the empty cardboard 12-pack container around as a mask is flying off the shelf.

From the Times:

Growers are behind on sales of grapes, which are fetching much lower prices than last year. Sales are sluggish for wines retailing at $15 a bottle and higher. Meanwhile, distributors, restaurants and retail shops are reluctant to buy more wine, preferring to sell through what they already have.

[snip]

"People are drinking out of their cellars, the big distributors are throwing their weight around, and you add these things up, and from the winery perspective, the cash flow is brutal," said Steve Matthiason, a vineyard consultant who also grows grapes and makes small quantities of wine. "Everybody figures this is kind of a temporary thing, that when restaurants burn through their inventory they're going to have to start buying again, and distributors, too. But everybody is wondering when the levee is going to break, and you have harvest coming up."

"Drinking out of their cellars" is exactly what we like to imagine laid-off bankers are doing when they're not busy fending off $2 million-a-year offers from Citibank. But we digress. The beer industry is also seeing a flight to quantity, the Wall Street Journal reports—astonishingly, people can't even afford to buy Budweiser anymore:

Heineken sales sank 18% from the previous year in grocery, convenience and drug stores during the two-week period ended July 5, followed by Budweiser at 14%. Corona Extra sales dropped 11%, while Miller Lite declined 9% and Bud Light fell 7%. Coors Light sales held up better, falling less than 1% from a year ago.

Meanwhile, sales of "subpremium" beers including Busch, Natural Light and Keystone posted "substantial gains", according to Ad Age, which didn't provide the specifics.

Subprime borrowers drink subpremium beer. Of course, the rich will always be with us, so when it's not busy writing about how the wretched poors are mopping up the floor with rags at bartime and squeezing foul remnants into their mouths for a few moments of relief, it's writing about rich people drinking from ostentatiously oversized bottles of precious wine:

Frank DeSalvo's dinner guests have come to expect a bit of spectacle when their host serves wine. The process sometimes involves a wooden cradle, holding an exquisitely blown glass vessel containing the equivalent of 24 bottles of wine, being lifted by several men onto the table.

After dinner, they go out and light bums on fire for kicks.