Bob Peale
angeli ribelli
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- Sep 4, 1999
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Cost of Christmas marches higher
PNC Advisors finds the items in the “12 Days of Christmas” carol cost 3.5% more this year than last, or a whopping $15,748. They also show a few recession hints.
By CNBC Staff
How much would it cost you to surprise your loved one with all the goods and services of “The 12 Days of Christmas” – from 12 drummers drumming to a partridge in a pear tree?
The whole package will set you back $15,748 this year, according to fund-management firm PNC Advisors. The 2001 figure is up 3.5 percent from last year’s $15,210 – a faster rise than the overall inflation rate.
Research experts at PNC Advisors have tracked the Christmas Price Index every year for the past 17 years. They say the index provides a good assessment of changing prices for goods and services across the economy.
“The Christmas Price Index supports the National Bureau of Economic Research’s assessment that we are in a recession,” says Jeffrey Kleintop, chief investment strategist at PNC Advisors.
PNC’s Kleintop on Power Lunch
He told CNBC’s Power Lunch that while most prices didn’t increase this year, the cost of gold rings shot up 50%. “During times of recession, people prefer to have hard assets with a global, intrinsic value,” he explains.
Kleintop points out that the most expensive items back in 1780, when the song first emerged, would have been the products. Now, it’s the services and specialized labor that hurt your wallet – such as the nine ladies dancing, 10 lords-a-leaping, 11 pipers piping and 12 drummers drumming.
When PNC first computed its index, goods prices accounted for 60% of the total price tag. Now, goods contribute 30% of the price, while services make up 70% -- another recession hint, Kleintop says.
Some very sensitive prices
Turns out the 12-days list is sensitive to all manner of factors economic and mundane. For instance, the reproductive rate for doves seems to have slid since last Christmas.
“The fertility of turtle doves was a little weaker this year, and prices rose [16%] as a result,” Kleintop says.
Meanwhile, good weather jacked up the fruits and vegetables on the list.
“The conditions were good for pear trees, yielding taller crops and heartier trees that cost more,” Kleintop says – 27.5% more. But the price of a partridge in that pear tree was $15, the same as last year.
Some advice on where to buy
If you’re still determined to buy a loved one the goods and services mentioned in the famous Christmas carol, keep in mind that you would get a better bargain if you stayed away from the Internet and shopped through traditional outlets instead. PNC Advisors claims that using the Web will tack on $8,000 to your overall bill, mainly because of expensive shipping and travel services.
For example, it would cost you about $17,800 if you were to use the Internet to hire the maids, ladies, lords, pipers and drummers (for a total of 50 people). By comparison, your bill would be about $11,000 for similar services bought locally.
In case you’re wondering about the repetitions – recall that the partridge in a pear tree is repeated 12 times – the “true cost of Christmas” is up to $62,935 this year from $60,307 in 2000.
As Kleintop muses, “an investment in the true cost of Christmas would have yielded a better return than the stock market over the past year.”
http://moneycentral.msn.com/content/CNBCTV/Articles/Dispatches/P12793.asp
PNC Advisors finds the items in the “12 Days of Christmas” carol cost 3.5% more this year than last, or a whopping $15,748. They also show a few recession hints.
By CNBC Staff
How much would it cost you to surprise your loved one with all the goods and services of “The 12 Days of Christmas” – from 12 drummers drumming to a partridge in a pear tree?
The whole package will set you back $15,748 this year, according to fund-management firm PNC Advisors. The 2001 figure is up 3.5 percent from last year’s $15,210 – a faster rise than the overall inflation rate.
Research experts at PNC Advisors have tracked the Christmas Price Index every year for the past 17 years. They say the index provides a good assessment of changing prices for goods and services across the economy.
“The Christmas Price Index supports the National Bureau of Economic Research’s assessment that we are in a recession,” says Jeffrey Kleintop, chief investment strategist at PNC Advisors.
PNC’s Kleintop on Power Lunch
He told CNBC’s Power Lunch that while most prices didn’t increase this year, the cost of gold rings shot up 50%. “During times of recession, people prefer to have hard assets with a global, intrinsic value,” he explains.
Kleintop points out that the most expensive items back in 1780, when the song first emerged, would have been the products. Now, it’s the services and specialized labor that hurt your wallet – such as the nine ladies dancing, 10 lords-a-leaping, 11 pipers piping and 12 drummers drumming.
When PNC first computed its index, goods prices accounted for 60% of the total price tag. Now, goods contribute 30% of the price, while services make up 70% -- another recession hint, Kleintop says.
Some very sensitive prices
Turns out the 12-days list is sensitive to all manner of factors economic and mundane. For instance, the reproductive rate for doves seems to have slid since last Christmas.
“The fertility of turtle doves was a little weaker this year, and prices rose [16%] as a result,” Kleintop says.
Meanwhile, good weather jacked up the fruits and vegetables on the list.
“The conditions were good for pear trees, yielding taller crops and heartier trees that cost more,” Kleintop says – 27.5% more. But the price of a partridge in that pear tree was $15, the same as last year.
Some advice on where to buy
If you’re still determined to buy a loved one the goods and services mentioned in the famous Christmas carol, keep in mind that you would get a better bargain if you stayed away from the Internet and shopped through traditional outlets instead. PNC Advisors claims that using the Web will tack on $8,000 to your overall bill, mainly because of expensive shipping and travel services.
For example, it would cost you about $17,800 if you were to use the Internet to hire the maids, ladies, lords, pipers and drummers (for a total of 50 people). By comparison, your bill would be about $11,000 for similar services bought locally.
In case you’re wondering about the repetitions – recall that the partridge in a pear tree is repeated 12 times – the “true cost of Christmas” is up to $62,935 this year from $60,307 in 2000.
As Kleintop muses, “an investment in the true cost of Christmas would have yielded a better return than the stock market over the past year.”
http://moneycentral.msn.com/content/CNBCTV/Articles/Dispatches/P12793.asp
