Drunken Speculation

MR | Fourth Edition, July 2014 – With no apologies to Stone

Whatever_People_Say_I_Am,_That's_What_I'm_NotLast week on Drunken Speculation, I pitched an idea about tracking brewery production and ammo wrote about the latest Sniff & Sip session featuring Ekim Brewing.

Interestingly both posts last week got a similar number of shares – the former on Twitter, the latter on Facebook via one C.Potts – but it was Sniff & Sip which had noticeably more hits. The lack of response to my idea is somewhat expected and not at all disappointing but it is, at best, a sign that this is an idea whose time has not yet come. On the other hand, much less work for me and also my blog posts are getting a bit too econo-wonky lately (see below).

We hit up the Archive (and Sling) for the first time in a long time on Saturday night, so Beer of the Week comes from the taps of our favourite West End establishment: New Englander Frederick India Brown Ale. I thought this was a standard brown ale until I got up and checked the tap decal more closely, so I don’t know if the brewers achieved what they wanted, but they still ended up with a great malt-forward beer.

To the Tweet(s) of the Week!

I don’t always agree with everything Alan McLeod writes – he’s a touch too cynical even for me – and I find it annoying that I always confuse him and Alan McCormick but he’s often got an incisive witticism up his sleeve about the state of beer.

To the best from last week:

The Stone Brewing crowd-sourced fundraiser was the biggest bit of news in the last seven days. I’ve read nothing positive about it but these were some of the better dissections:

Another question you might be asking yourself: “Freetail is a for-profit business, couldn’t you just… like… you know… use your own money for this Delivery Lambo?”Another easy one. Yes, we could. But what fun would that be? It is time to cast aside the archaic economic philosophies of our forefathers that puts corporate funds at risk for ventures that only might possibly generate a positive return. Crowd Sourcing has revolutionized capitalism. Since you aren’t expecting a return on investment, there is no risk for either of us. You get a cool prize (in this case, mostly high fives) and we get a Delivery Lambo, risk free. Business will never be the same now that risk has been eliminated from the investment decision. I’m an Economics Professor, you should trust me on this.

I’m not going to write a post on this because there are already plenty and quite frankly I don’t want to do the research required to delve into the details, however, I have had a few speculative thoughts:

  • There’s not a lot of detail on how the non-crowd-funded money has come about. Most people are assuming that Stone got a massive loan from the bank but it is likely that it’s a mix of cash on hand, bank loans and flogging off equity, perhaps to the nice gentlemen banksters who own a chunk of Brewdog or people like them.
  • Interest rates are at historical lows, especially in the US and Eurozone. Indeed, the rate for a business loan in the States is 3.3%, down from 8.1% in 2007. Depending on the size of their loan (if there is one), Stone have exposed themselves to massive interest rate risk. In other words, as rates begin to rise (as they almost certainly will again in 2015 or 2016), Stone’s interest bill correspondingly rises. On big loans, the interest repayment goes up quickly and it will be interesting to see if Stone’s revenue can grow at a commensurate rate.
  • While getting a bank loan has never been cheaper, treating crowd-sourced funding as free money or not risky is massively shortsighted. Banks can provide an almost infinite number of US dollars, if you can afford the interest repayment, but your fanbase does not have infinite dollars to give away. So while there’s no real cost associated with crowd-sourced funds, their supply is extremely finite and the backlash (as described above) can be severe if the funding scheme is inappropriate.
  • Greg Koch may look like a scraggly homeless guy (or der Bier-Jesus, if you prefer) but he’s almost certainly a millionaire. Without knowing the personal details of his financial situation, I’d wager large sums he’s a member of the 1% and therefore not at all like you.
  • This guy won’t bring his beer to Australia but wants to build two breweries simultaneously. How’s that for a perspective on the risk to the business?
  • If this goes tits up, how will that impact banks’ perception on the risk of brewing and will future brewery expansions be perceived as more risky and worthy of higher rates? The converse case also applies: if it’s a success, will that lower borrowing costs for other breweries?

If Stone’s expansion does end up being a massive disaster, I don’t expect it to be the end of the beer boom, however, we might look back on this as the first sign that “craft beer” is not the miracle industry that it’s been for the last six years or so.

Randy Mosher c/o Allaboutbeer – Beer as a Path to Self-Awareness

For perception to be translated into language, it has to be encoded semantically: organized into a logical framework, like the rainbow for colors as mentioned above. While we do group aromas into broad categories like floral, spicy and others, trying to organize them further is almost impossible for us. Where in the brain this coding is done is not totally clear, but evidence suggests that it may occur at a level far below our conscious awareness and importantly outside the semantic organizing networks our brains use for so many other things. And one more thing: The encoding we do use to tag various aromas likely includes a strong emotional component. Try organizing that.

Tasting Nitch – Are we taking beer too seriously?

That beer porn is important to you. And if it were a picture of your wife, with all her bubbly glory in a high resolution close up, then yeah sure by all means, give me the “hey, that’s mine!” message. But, your site was cited and commented on, the picture isn’t trade marked and, it isn’t like I’m making big bucks off this blog. I’m not upset. I took the post down. It was a shitty old post that I had completely forgot about. What does grate me is this serious approach to selfishness with beer.

People die every day over beer related disputes.

Also yes.

Growler Fills – Who Will Save the Idea of Craft Beer

But Papazian’s organization defines it anyway.  The BA chose to adopt cutoff points and most definitely turned “craft brewer” into a literal definition. Remember the BA’s chart showing who did and did not qualify under their definition?  Sorry, Charlie, but your idea got hijacked.

Other industries are not having this battle.  Grocery store giant Safeway sells an Artisan™ line of breads baked daily at its stores.3 Some of it is even pretty tasty.  Yet, we don’t see hoards of local bakers crying foul over corporate America hijacking a term that “should” be reserved for small, independent, and traditional bread makers.  You know, the community folks who are having to compete on price, location, convenience, distribution channels – and quality – with the big boys.

What do these local bakeries offer? A way to support local business, of course, but they also enjoy the presumption – though not necessarily the reality – of better quality.

The New Yorker – What We Really Taste When We Drink Wine

Plassman found that people’s expectations of a wine’s price affected their enjoyment on a neural level: not only did they report greater subjective enjoyment but they showed increased activity in an area of the brain that has frequently been associated with the experience of pleasantness. The same goes for the color and shape of a wine’s label: some labels make us think that a wine is more valuable (and, hence, more tasty), while others don’t. Even your ability to pronounce a winery’s name can influence your appreciation of its product—the more difficult the name is to pronounce, the more you’ll like the wine. In 1999, psychologists from the University of Leicester found that the type of music playing in a store could influence which wines were purchased: when French music was playing, people bought French wines; when German music was turned on, German wines outsold the rest. The customers remained oblivious.

Ed’s Beer Site – Lager yeast has Tibetan origins

Recently, a Patagonian origin hypothesis of lager yeast has been proposed based on the discovery of a new cryotolerant Saccharomyces species from Patagonian native forests of Argentina . This yeast, named S. eubayanus, exhibited the closest known match (99.56%) to the non-ale portion of lager yeast and, thus, was believed to be its progenitor. However, we now show that this yeast species is likely native to the Tibetan Plateau. One of the Tibetan populations of the species exhibits closer affinity with lager yeast than the Patagonian population as inferred from population genetics and genome sequence analyses. We thus provide strong evidence for a Far East Asian origin hypothesis of lager yeast, which apparently corresponds better with geography and world trade history.

Brewer’s Association – The (Non) Beer Bubble, Part Deux

While I’m a bit hurt that the mass media doesn’t read the blog, here goes round two in dispelling the notion that reaching 3,000 breweries means the country simply can’t take any more. It all stems from a simple concept:


While one would normally ignore the economics coming out of a lobby group, the guy has a point and one I’ve made previously. Interestingly, BA seem to be working off some rough survey data rather than something closer to a census.

Queen City Drinks – Randall the Enamel Animal Jr. (Beer Infusions) + Recipes

In the simplest sense Randall the Enamel Animal Jr. is a heavy plastic bottle, a metal mesh screen, and a cap. These 3 parts screw together with rubber gaskets at each level so the beer doesn’t go flat while infusing..

Yes, it is just a fancy French press. I’m not a coffee drinker, love the flavor though, so I don’t own a French press. If you are a coffee drinker then save yourself the $20 and just use a French press.

Larsblog – Voss – farmhouse ale central

Much of the talk centered around all the open questions we had. Were all the kveik strains in Voss similar? Was it really just one strain, given how much sharing there obviously was? Did it exist elsewhere? …

And then I’m woken at 0730, by desperate hammering on my door. “Lars! Lars! Come quick!” It’s Martin. I’d really like to sleep longer rather than rushing off yet again, so I try stalling and ask what it is. “There’s a home brewer from Hardanger in the kitchen!” Now that got me out of bed.

Lars also noted later in the week:

Which is disappointing. The kveik mystery continues.

Other highlights were:

Anything I missed?


  1. “Greg Koch may look like a scraggly homeless guy (or der Bier-Jesus, if you prefer) but he’s almost certainly a millionaire. Without knowing the personal details of his financial situation, I’d wager large sums he’s a member of the 1% and therefore not at all like you.”
    Great point – wish I thought of it.

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