In the heady, sometimes snobby, but always trendy world of wine there's a genuine phenomenon going on. It's a frenzy around one winery -- Charles Shaw -- and its aptly- nicknamed "Two Buck Chuck" wine.

At Trader Joe's in Emeryville, "Two Buck Chuck" is rolling out the door at a rate of 3,000 bottles a day.

"I've heard great things about it," said Diane Luong as she stood in the store. "And it's so cheap. You can't beat the price."

Nearby, Andreas Schwarz, agreed.

"My sister actually had a party where they did a wine taste test," Schwarz said. "They took all the labels from all the wines and that one (Two Buck Chuck) actually won against a bunch of wines that were about five, six times more in terms of price."

Trader Joe' s 188 stores are doing a booming business in Charles Shaw cabernet, chardonnay and sauvignon blanc, each just $1.99 a bottle.

"Good wine, great price," said Adam McMickin, of Trader Joe's explaining the buying frenzy. "People are talking about it left and right -- at parties, at work -- and they seem to think they have to have it."

The frenzy also has Charles Shaw officials scratching their heads.

"I've never seen anything like it," said Harvey Posert, a winery spokesman. "Charles Shaw and 'Two Buck Chuck' is a kind of reverse cult wine. People are driving into Trader Joe's and driving out with cases in their car."

Arthur Damond is in his 26th year of publishing the highly successful bi-monthly newsletter -- Wine Discoveries -- and is arguably the guru of inexpensive wine.

"In the wine world, probably more so than in many other areas of life, quality does not necessary follow price," Damond said.

Especially so now because wine prices are collapsing in the weak economy and demand is way down. While sales have fallen off, the supply is way up. Adding fuel to the trend is the fact that California's wine industry has grown so large -- 1600 acres of vineyards -- that there is a glut of grape, sending prices spiraling downward.

"In addition, all over the world they are growing grapes and shipping wine into America," Posert said.

The strong dollar has made foreign wines a great bargain for U.S. consumers -- so much so that one in four bottles of wine sold here is foreign made -- up from sixteen percent just a few years ago.

"So you have the combined slow down in the economy dampening those sales and an over supply that we believe is temporary," said Karen Ross of the Association of Winegrape Growers.

But good, cheap wine may be here to stay.

"High-end wines have really become dead in the water," said Doug Canepa, of the Mill Valley Market. "And they simply aren't moving (off the store shelves)."

"In the past, it was always the ceiling. Who was gonna graze the ceiling and achieve the higher price. But 'Two Buck Chuck' has broken the floor…I've been told by some producers that if they missed an entire vintage, it wouldn't be a problem because there's so much wine in the pipeline."

For now, the entire wine industry -- from growers and vintners to cork suppliers and barrel makers -- will have to live in the shadow of 'Two Buck Chuck.'