THE TWELVE DAYS OF CHRISTMAS PRICE INDEX
From the PNC Bank Web site http://www.pncbank.com/12days/cardindex.html 12/98.
In an odd twist on historical patterns, women's wages rising more than men's contributed to a 6.53 percent rise in the one-time cost of the gifts in the song "The Twelve Days of Christmas," which totaled $14,214.90 this year, according to the PNC Bank 1998 Christmas Price Index.
The price jump is even more striking if someone were to buy all 364 gifts listed when the song is sung in its entirety, according to Rebekah McCahan, investment strategist for PNC Bank, which has been monitoring the cost of the items in the song since 1984. For instance, at the end of 12 days, carolers have crooned about the 364 presents in the song – including 12 partridges in a pear tree, 36 calling birds, 40 maids-a-milking, 22 pipers piping and so on – for the grand total of the song's "true cost of Christmas" of $58,405.09 this year, a 6.02 percent increase over 1997.
The 6.53 percent increase in the one-time cost of buying the gifts in the song for one day is much higher than the government's Consumer Price Index inflation rate of 1.5 percent. Although the two indices do not track together this year, they did so last year. "The variance in the two rates shows how difficult it is to forecast inflation using such a small and unusual basket of goods," McCahan said.
In a significant triumph in the age-old wage dispute among the sexes, the song's nine ladies dancing received a wage increase to $3,932.72 or 20.69 percent, this year, moving their salaries further ahead of the carol's men, the 10 lords-a-leaping, 11 pipers piping and 12 drummers drumming (based on the assumption that during medieval times, when the song was written, pipers and drummers were male). 1998 wages for the lords, pipers and drummers also rose, to $3,433.99, $1,179.36 and $1,277.64 respectively, for a percentage increase of less than 4 percent across the board.
Alas, the dancing ladies experienced better fortune than their female peers on the farm: the song's 8 maids-a-milking, whose compensation depends on the minimum wage, saw no rise in their income because the minimum wage held steady in 1998. In addition, their jobs are being phased out by automation. They cost $41.20 this year.
Despite the steady wage of the maids-a-milking, 1998's total wages for the other four groups representing the service industry in the song registered a 9.91 percent overall gain over the prior year. that compares to the 2.7 percent increase in service wages in the overall U.S. economy.
"The higher salary earned by our service group represents classic characteristics of a tight labor market in a good economy," McCahan said.
This year's Christmas Price Index also revealed another interesting shift in trends: women's taste in wedding bands is changing from a plain yellow gold band – the version traditionally measured by the Christmas Price Index – to a ring mounted with diamonds or other gems. Due to this supply vs demand phenomenon, as well as low inflation and a fall across the board in commodities prices, the price of the five gold rings in the song has fallen 23.08 percent this year to $250.
And the cost of a partridge in a pear tree rose 133.31 percent, now costing $104.99. That was because the pear tree, which was on sale last year, is now selling for its regular price of $89.99 (a 199.97 percent jump); the $15 partridge stayed the same as the previous year.
The price of the other items in the song also remained the same: Two turtledoves command $50, three French hends still cost $15, four calling birds can be had for $280 and six geese-a-laying are $150. In addition, you'll still have to plunk down $3,500 for seven swans-a-swimming.
1999 UPDATE
From: http://www.pncbank.com/12days/index.html 12/99
Labor costs and inclement weather pushed PNC Advisors 1999 Christmas Price Index up 5.1% over last year's cost of purchasing the 12 gifts in the age-old song, "The Twelve Days of Christmas." Each year since 1984, PNC Advisors has provided a tongue-in-cheek tracking of the goods and services purchased by the "True Love" in the holiday classic. This year a set of your loved one's gifts, from the Partridge in a Pear Tree to the twelve Drummers Drumming, will cost a total of $14,940.17.
If you followed the literal gift giving within the song, with no substitutions, you would purchase a total of 364 gifts because on each successive day you would repeat the prior day's gifts. If this were the true cost of gift giving, then the total bill in 1999 would come to $59,719.33. The good news is that the labor-intensive gifts near the end of the song are not repeated as often, so the annual cost of the total bill rose only 2.3% which is less than the 2.6% increase in the Consumer Price Index over the last twelve months.
Contract negotiations with one of the most expensive components, ten Lords-a-Leaping, rose 3% with a cost in 1999 of $3,537.00. The most labor-intensive gifts, eleven Pipers Piping and twelve Drummers Drumming, demanded a 25% increase over last year to $1,474.20 and $1,597.05 respectively.
"Although not consistent across the entire service sector, increased costs for specialized positions are inevitable in the current tight labor market," said Don Berdine, chief investment officer for PNC Advisors. "In fact, the rise in these particular costs is an area of concern expressed by Federal Reserve Board Chairman Alan Greenspan this week."
PNC Advisors stated that they waited until after the Federal Open Market Committee meeting to release this year's data so as not to push the Federal Reserve beyond the recently announced 25 basis point increase in interest rates.
Weather was also a significant factor in influencing the Christmas Price Index, with the drought in the mid-Atlantic states pushing pear trees up almost 9% to $98.00. The price of the other eight gift items remained the same as last year.
"Each year, we try to pinpoint major economic trends or factors that affect the Christmas Price Index," said Rebekah McCahan, Investment Strategist for PNC Advisors. "Next year, we will see if global procurement of goods and services through e-commerce will keep prices flat or even generate a decline in costs."
PNC Christmas Price Index
Gift 1996 1997 1998 Change 1998/97 1999 Change 1999/98
One Partridge in a Pear Tree $27.50 $45.00 $104.99 133.31% $113.00 7.63%
Partridge $15.00 $15.00 $15.00 0.00% $15.00 0.00%
Pear Tree $12.50 $30.00 $89.99 199.97% $98.00 8.90%
Two Turtle Doves $50.00 $50.00 $50.00 0.00% $50.00 0.00%
Three French Hens $15.00 $15.00 $15.00 0.00% $15.00 0.00%
Four Calling Birds $280.00 $280.00 $280.00 0.00% $280.00 0.00%
Five Golden Rings! $325.00 $325.00 $250.00 -23.08% $250.00 0.00%
Six Geese a Laying $150.00 $150.00 $150.00 0.00% $150.00 0.00%
Seven Swans a Swimming $3,500.00 $3,500.00 $3,500.00 0.00% $3,500.00 0.00%
Eight Maids a Milking $38.00 $41.20 $41.20 0.00% $41.20 0.00%
Nine Ladies Dancing $3,258.54 $3,258.54 $3,932.72 20.69% $3,932.72 0.00%
Ten Lords a Leaping $3,182.57 $3,309.87 $3,433.99 3.75% $3,537.00 3.00%
Eleven Pipers Piping $1,137.24 $1,137.24 $1,179.36 3.70% $1,474.20 25.00%
Twelve Drummers Drumming $1,232.01 $1,232.01 $1,277.64 3.70% $1,597.05 25.00%
Total Christmas Price Index $13,195.86 $13,343.86 $14,214.90 6.53% $14,940.17 5.10%
True Cost of Christmas in Song $54,478.36 $55,086.26 $58,405.09 6.02% $59,719.33 2.25%
PNC Bank, Asset Management Group