Look To The Bottle

Bert e-mails to hep us to a story on what sales of Scotch may tell us about the economy:

For those trying to see through the current global economic fog and work out how bad things may get, enlightenment can come in many forms.

Sales of scotch whisky are regarded by some as a fair, if unusual, barometer of economic prospects and how confident people feel about the present and the future.

"I tend to believe there is a correlation between the two," says Paul Hughes, director of the International Centre for Brewing and Distilling at Heriot Watt University.

The reason for this is fairly simple.

Scotch is a truly global product sold in more than 200 countries.

Though it may not be a staple item

Well maybe not in your house.

or a commodity, like oil, which is traded by the second and whose price is tracked in minute detail, it is enjoyed in most corners of the world and therefore a decent indicator of broader buying patterns.

Historically, scotch sales have tended to follow the global economic curve.

In the last 30 years, the value of sales has only fallen three times: in 1983, 1998 and 2004.

This makes sense. If you are going to cut back, one of the areas that would likely be impacted would be booze. Not that you would quit drinking, but instead of a fifty dollar bottle of single malt Scotch, you might opt for a fifteen dollar domestic whiskey instead.

I used to think that the liquor industry was fairly recession proof, but a friend who owns a store here reports that rising gas prices and the softening economy have directly impacted his sales. Again, it's not that people aren't drinking anymore. They're just drinking more frugally.