Karen (aswanargent) wrote,

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A little Christmas merriment (from an economist's point of view)

The Christmas Price Index 2011

If you’re in the market for seven swans-a-swimming, you’ll be shocked (shocked!) at the price increase from last year. A novel take on the Christmas classic.

Every holiday season, PNC Financial Services (formerly Pittsburgh National Bank) calculates the inflation rate of the cost of gifts in the holiday classic, “the Twelve Days of Christmas.” This tongue-in-cheek look at the economy has been a great source of amusement for the past 28 years.

(The following analysis was provided by someone whose earns his living managing fixed income investments, so he knows whereof he speaks.)

“The “True Cost of Christmas,” which is the total cost of the items gifted by a True Love (the one who repeats all of the gifts given in each verse) is $101,119.84, a 4.4 percent increase over last year. This is the first time it is over $100,000. These prices reflect an economy that still continues to struggle and exhibits weakness in some areas of demand.

“Among all the gifts, the biggest dollar increase this year was the price of the Seven Swans-a-Swimming, which rose 12.5% to $6,300. In contrast, the Four Calling Birds dropped in price by 13.3% to $519.96. And, while the 11 Pipers Piping and 12 Drummers Drumming both saw modest increases of only 3.0%, the Partridge increased 14.2% and the Pear Tree increased 13.3%, for a total cost of $184.99. The percentage increase for the Pear Tree alone serves to contradict the national trend of declining house prices. Many hope that Federal Reserve Chairman Ben Bernanke will see this as a solid signal that stronger house prices are coming back.

”Finally, only four items this year maintained their same price from last year: Three French Hens, Eight Maids-a-Milking, Nine Ladies Dancing, and 10 Lords-a-Leaping. It is important to note here that the Eight Maids-a-Milking, as unskilled laborers, did not see an increase in pay for the second straight year because the federal minimum wage did not rise, either. This benefit will pass on to the local merchants who are attempting to maintain their prices on these items in order to attract reluctant, if not late season, buyers.”

To me, the one conspicuous absence here is any analysis of the year over year price change of five gold rings....

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