Where are we going? To inflation indicators.
The Christmas Price Index
Eight items retained their 2015 price:
- three French hens
- four calling birds
- five gold rings
- six geese-a-laying
- seven swans-a-swimming
- eight maids-a-milking
- nine ladies dancing
- ten lords-a-leaping
- turtle doves (+29.3%)
- eleven pipers piping (+2.8%)
- twelve drummers drumming (+2.8%)
And the partridge’s price plunged from $25 to $20. But the pear tree was the same.
Why Prices Changed
An oversupply of game birds depressed partridge prices while the opposite was true for turtle doves. Because turtle doves produce relatively few offspring each year, we could say that their supply is inelastic and more susceptible to price changes. As for the eleven pipers piping, their paycheck went up but not the maids because unskilled labor retained the same minimum wage.
The Online Shopper
Calculating what an online shopper would pay for all 364 items, PNC came up with a $46,181.85 premium. It makes sense that shipping all of those birds can be pricey. But PNC also said that buying online, you can pay more. I wonder??
Below are specific prices. PNC even created a core index because historically volatile swan prices would have distorted our analysis.
Our Bottom Line: Inflation
With more of a gap this year (11/15 to 11/16), the PNC CPI was up .7% while the BLS CPI rose 1.7 %. Similarly, there is a 1% gap between each one’s core index in which they exclude volatile items. The PNC core CPI is up 1.1% and the BLS CPI, 2.1%. With the Federal Reserve saying their target inflation rate is 2 percent, we see that PNC provides less validation of the Fed’s recent interest rate hike.