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The 12 (very expensive) days of Christmas |
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21 December 2010 |
Mr Urquhart Stewart, the proficient author of this column is going under the knife this week, having his leg seen to by some top class surgeons. That however, did not stop Justin from showing off some moves, and spinning me and several other lucky ladies around the dancefloor at the 7IM Christmas party last week.
Mr Urquhart Stewart, the proficient author of this column is going under the knife this week, having his leg seen to by some top class surgeons. That however, did not stop Justin from showing off some moves, and spinning me and several other lucky ladies around the dancefloor at the 7IM Christmas party last week. Rest assured Justin, should dancing be part of your post surgical treatment and therapy, you have no shortage of dance partners who would happily stand up with you.
Although Justin alluded to my having 'fascinating insights into the investment world,' unfortunately the only discerning news I have for you this week is that even the finance industry is caught up in the yuletide spirit:
"What about the sovereign debt crisis? How likely will a rescue package be needed for Portugal?"
"Who cares?"
"Are there concerns that the US has lost fiscal credibility as the result of the surprisingly large stimulus proposed for 2011, and if unsuccessful will increased protectionism be used as a tool to support US demand, culminating in a trade war between the US and China, that could spill over to other countries?"
The exciting piece of data to be most concerned with during this time of year is, of course, the Christmas Price Index. The index released by PNC Wealth Management measures true love's real cost this Christmas. If some inspired/misguided romantic was to fork out for 12 drummers drumming, 11 pipers piping, and so on down to that partridge and the pear tree, he would spend $23,439 this year. This is a staggering 9.2% increase on what he would've spent last year, and the second largest jump in the index's 27 year history. It will probably come as no surprise to you that the jump in the PNC CPI's index is largely attributed to the staggering rise in the price of gold this year. The price of 5 golden rings has surged 30%. And if just out of curiosity, you were wondering where you would go to find 10 Lords-a-leaping...try the Houses of Parliament during an expense audit.
While the index is a light hearted look at inflation, there are some real world parallels that are interesting and important to note. The wages of 8 maids-a-milking were unchanged; which reflects the fact that with developed economies struggling to maintain a sustainable level of growth and fighting high unemployment, a lid has been kept on wage inflation (banker bonuses aside of course!).
The cost of birds in the PNC CPI index was reported to have increased partly due to the cost of feed. You don't need to look further than your local supermarket to see the real world parallel here. You might also remark on how much more you are paying for breads, cereals, meat, flour, and other wheat related products. Wheat prices have come under incredible strain this year following severe droughts and fires in Russia and Kazakhstan, an invasion of locusts and floods in Canada, and rotting stocks of grain in India. In fact, year-on-year food and non-alcoholic beverage prices rose by 1.6%, playing a significant part in the UK inflation rate rise of an incredible target busting 3.2%, as reported by the Office of National Statistics last week.
The result is that you are going to end up paying more for your Christmas turkey this year. And for that relative who inevitably ends up on the wrong side of tipsy before the turkey hits the table, you will quite possibly have to pay more for their beer or cider of choice. Even the humble sprout hasn't escaped the clutches of inflation with the big UK freeze damaging this year's harvest. The BBC reports a kilo of sprouts to have cost |
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