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  • Juanita Schwartzkopf

A Christmas Take on Inflation

Over the past year, FMG has provided many articles addressing inflation, commodity price changes and other trends that are impacting the financial performance and the liquidity of businesses. We have discussed the Consumer Price Index (“CPI”), the Producer Price Index (“PPI”), and the Personal Consumption Expenditure (“PCE”) index.

But, here is a new one for us all to consider.

The PNC Christmas Price Index

(trademarked as PNC CPI®)

Who knew that for 38 years PNC bank has been publishing the PNC Christmas Price Index!

Here is a link to the PNC CPI® website:

Focus Management Group - christmas

The 2021 PNC Christmas Price Index shows an inflation rate of 5.7% over 2020, with the total purchase price of the 12 days of Christmas gifts at $41,205.58 compared to $39,993.59 in 2020. The first year of the PNC Christmas Price Index was 1984, when the 12 days of Christmas gifts would have cost $20,069.58.

A common trivia question is to ask what the 12 days of gifts include. The gifts are:

  1. A partridge in a pear tree,

  2. Two turtle doves,

  3. Three french hens,

  4. Four calling birds,

  5. Five gold rings,

  6. Six geese a-laying

  7. Seven swans a-swimming,

  8. Eight maids a-milking,

  9. Nine ladies dancing,

  10. Ten lords a-leaping,

  11. Eleven pipers piping,

  12. Twelve drummers drumming.

The gifts with the largest inflation factors are two turtle doves, which increased 50% to $450.00, three French hens, which increased 40.5% to $255.00, and six geese a-laying, which increased 57.1% to $660.00.

The gifts with the smallest inflation factors were four gifts that all had a 0% inflation factor. Those gifts are four calling birds at $599.96, seven swans-a-swimming at $13,125.00, eight maids a-milking at $58.50, and nine ladies dancing at $7,552.84.

The most expensive gift is the seven swans-a-swimming with a $13,125.00 price tag, while the least expensive gift is the eight maids a-milking at $58.50.

It is interesting to note that the latest CPI was reported at 6.2% in October 2021 and the latest PPI was reported at 8.6% in October 2021. The most recent PCE reporting was at 4.4% in September 2021.

It looks the PNC CPI® is in the same ballpark as those more well-known inflation indices.

Focus Management Group - christmas

Inflation isn’t the only issue Santa is dealing with this year as he works to meet the requests of children around the world. This year Santa will also be impacted by labor shortages in the elf population, and his cash flow will be impacted by the cancellation of fourth quarter ERCs in the Bipartisan Infrastructure Bill. Santa’s cash flow has been negatively impacted by the increased price of feed for his reindeer as a result of the commodity price changes. His deliveries of feed have been negatively impacted by truck and sleigh shortages, but he has used his line of credit to fund a higher level of feed inventory to ensure his reindeer are well fed and ready for the busy Christmas trip season. Looking to Christmas Eve Santa is planning for ways to reduce the wait time at ports around the world, and is working to find the seasonal elf workers to support his increased deliveries during Christmas week.

Santa’s management team has been proactively planning for the holiday season for months and has been preparing sensitivity analysis and alternative work flow scenarios to ensure the entire Santa structure is ready for the peak activity period.


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