U.S. economy slow to recover!
Reflecting a steep decline in energy costs, lower inflation and slow-but-steady economic growth, the 2015 PNC Christmas Price Index® (PNC CPI) experienced its lowest growth rate in six years at 0.6 percent in the whimsical economic analysis by PNC Wealth Management. Except for years in which the PNC CPI fell, this is the lowest rate by which it has risen in its history.
According to the 32nd annual report, which measures the cost of the gifts in the holiday classic The Twelve Days of Christmas, the price tag for the PNC CPI is $34,130.99 in 2015, a mere $198 more than last year’s cost and in-line with the U.S. government’s Consumer Price Index, which has increased 0.2 percent over the past 12 months.
The cost of 10 lords a-leaping increased 3 percent over last year, but the price of nine of the other 12 gifts listed in one of the most well-known Christmas carols, The Twelve Days of Christmas, were unmoved from last year, according to the 32nd annual PNC Wealth Management Christmas Price Index released Monday.
"The headline, I think, is that inflation in this economy, with the sort of tepid recovery we've seen, is almost nonexistent," said Jim Dunigan, chief investment officer of PNC's asset management group.
While the good news is that the price of consumer goods isn't rising very much, it also means demand for those goods is down, at least partly due to wage stagnation, a shrinking middle class, and people working longer hours for lower wages (I wonder where we've been hearing that lately?).
The government's Consumer Price Index has pegged inflation at about 0.2 percent, Dunigan said.
The only other items to increase in price since last year were a partridge in a pear tree and two turtle doves:
The bird in the bush rose 3.5 percent overall, mostly because partridges now cost $25 each, up from $20, because partridges are increasingly popular as gourmet food. Pear trees inched up from $188 to just under $190.
Turtle doves increased 11.5 percent, from $260 to $290, due mostly to increased grain prices that increased feed costs.
The lords a-leaping are more expensive this year in part due to increased labor costs, raising their price from $5,348 in 2014 to $5,509.
PNC calculates the prices from sources including retailers, bird hatcheries and two Philadelphia dance groups, the Pennsylvania Ballet and Philadanco.
As part of its annual tradition, PNC Wealth Management also tabulates the “True Cost of Christmas,” which is the total cost of items gifted by a True Love who repeats all of the song’s verses. The ultra-generous True Love will have to fork over $155,407 to pay for all 364 gifts, nearly $900 more than last year.
Included in the data contained in their press release is this hidden item: the cost of purchasing the items on the Internet rose more this year than via traditional brick & mortar shopping.
The total PNC CPI for Internet-based purchases for 2015 increased 1.6% over last year, with the Total cost of Christmas rising 2.1% to a staggering $196,477. Interestingly, the cost for a partridge in a pear tree fell 3.1% from 2014 to $234.94 and the price of three French hens from the 'net dropped a hefty 15.1% to $281.50.
PNC offers this explanation to explain why the cost of the 12 Days of Christmas is more expensive on the Internet: For those True Loves who prefer the convenience of shopping online, PNC Wealth Management calculates the cost of “The Twelve Days of Christmas” gifts purchased on the Internet. As Internet prices tend to be higher, True Loves will have to splurge $43,626.73 ($9,495.74 more than buying “in person”) for the convenience of online shopping this year.
It just goes to show that you don't always get the best deal in price by shopping online, which could spell good news for the nation's struggling mom & pop stores -- those small businesses people tend to overlook during the holiday season.
Despite the PNC CPI rising 0.6% -- at worst -- the news isn't cheerful at all this year for the millions of people who receive Social Security payments: the Social Security Administration announced that there was no increase in COLA (Cost of Living Adjustment) and, as such, there would be no increase in the Social Security payments in 2016 for individuals who are disabled or retired.
While the government's core CPI rose nearly 2% in 2015, the COLA -- on which the SSA bases its decision to increase social security payments every year -- saw no change.
The manner by which the Social Security Administration calculates increases for beneficiary recipients needs to be changed. If the government calculates an increase in the core CPI, which does not even include items like energy and food (not that we need these to live, mind you), then it is even more absurd to say that the cost of living has not risen a single cent!
This is almost as insane as the fact that the prices for the Eight Maids-a-Milking, the only unskilled workers in the index, held steady for the sixth straight year -- reflecting the federal minimum wage, which has not been in creased since 2009!
Here is the full set of prices, taken from PNC's press release (sorry for not providing a text-based copy as well but Tables aren't easy to create in Google's Blogger!):