While iPads and Nintendo Wii U may top the holiday wish list this year, another Christmas gift list talks of filling stockings with golden rings, french hens, and milk maids. The classic carol ‘The 12 Days Of Christmas’ may be more fanciful than realistic, but what would it cost to acquire all of the items on the list? For the past 29 years, PNC has calculated the ‘Christmas Price Index’ to tabulate the true cost of Christmas. The holiday ‘CPI’ closely resembles the traditional CPI (Consumer Price Index), with the fluctuating prices of milk maids and rings reflecting the U.S. Department’s measure of inflation.
Given the country’s current economic condition, it’s no surprise that the Consumer Price Index saw an increase in 2012 compared to 2011; through September, the CPI stands at 2.2% for the past 12 months. The Christmas Price Index, however, saw an even more significant jump in 2012, with the price for all 78 items on the list rising 4.8% from 2011. Christmas costs more than ever at $25,431.18, an increase of more than $10K compared to the price in 2000.
Why the rise in costs? The gifts on the list responded to the same challenges we’ve seen in 2012– a severe drought raised the price of feed for birds, causing the price for the three french hens, six geese, and seven swans to all see double digit increases in price. Gold prices also rose, making it even pricier for the ‘true love’ to give the gift of five golden rings. Housing prices, as we are well aware of in NYC, also soared this year, which are reflected in the soaring price for the partridge’s pear tree ‘home.’
While reports indicated that more consumers planned to shop for holiday gifts online during Cyber Monday than in physical stores on Black Friday, the Christmas Price Index shows the hidden costs of ordering gifts on the Internet:
The Internet makes it easier to find the gifts from the song online, but these goods and services tend to be expensive, due to added shipping and handling costs… fuel costs [also] have a major effect on the cost of shipping. And, as we know, fuel prices have been especially volatile over the past few years.
But whether you’re shopping online or in stores, Jim Dunigan, managing executive of investments for PNC Wealth Management, says there is reason for hope during the holiday season:
The rise the PNC CPI index is larger than expected considering the modest economic growth we’ve had over the past 12 months. Despite some weak spots in the economy, consumer balance sheets are improving along with consumer confidence, which means this may still be a spirited holiday season.
The price for iPads and Nintendo Wii Us may seem steep, but be thankful kids don’t have twelve drummers drumming and nine ladies dancing on their list– if you were to add up every item on the ’12 Days Of Christmas’ list every time it was repeated in verse, the bill for Christmas would stand at a hefty $107,300.24 for all 364 gifts.