What’s so plain about vanilla?

January 20, 2009

There’s an expression that’s been circulating – plain vanilla finance (See ex here).  The question is, what’s so plain about vanilla?

Derived from a specific variety of orchid native to Mexico, the vanilla bean was once a rather exotic delicacy. According to Wikipedia it was originally impossible to cultivate the vanilla plant outside Mexico and Central America […] because of the symbiotic relationship between the tlilxochitl vine that produced the vanilla orchid and the local species of Melipona bee”.  Thus, the history of vanilla – from exotic local ingredient to the definition of plain for the palate – raises interesting questions about how things become standard fare in flavors as in finance.

Vanilla’s transition from particular to plain passes through chemical sciences.  It was when vanillin was isolated as a pure compound by Nicolas-Theodore Gobley that it became possible to synthesize the essence of vanilla.  So while purists will argue that there is no substitute for the complexity of the vanilla extracted from whole pods, the plainness of vanilla as a basic flavoring is due to its translation into a mass production compound through the commercial development of vanillin.

Vanillin, like a financial product, is synthesized through complex processes mediated by science and technology.  Just as vanillin has changed the nature of vanilla, it would be interesting to trace just how some financial operations have made the transition to becoming quite so plain.  A scoop of ‘vanillin finance’ anyone?

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