In this delightful holiday special, Santa Claus gives Elmo three wishes - and Elmo wishes for Christmas every day!

Elmo tries to wait up on Christmas to see Santa Claus descend from the chimney. He falls asleep, but is awakened when Santa is stuck. Elmo nobly pulls Santa out, where they discern the cause of the extra weight -- a stowaway reindeer named Lightning. In gratitude, Santa offers Elmo a gift: a pink bear, or a magical snowglobe that will grant three wishes. Elmo wants the pink bear, but then chooses the latter, and uses his first wish to obtain a glass of water. Santa tells him he could've wished for anything, and to not waste the other wishes.
On Christmas Day, Elmo wishes that it could be Christmas every day. Santa tries to talk him out of this, but Elmo refuses. At first, everyone is thrilled about it being Christmas again, thanks to a news report given by Kermit the Frog. Elmo thinks it's a wonderful wish, until Santa gives Lightning to Elmo and instructs them to visit the future and see how Christmas every day is not a great idea. Elmo sees Big Bird mope over the fact that Snuffy is in Cincinnati, spending Christmas with his grandmother for a whole year, Maria and Luis get crabby over being closed all year, everyone get annoyed at It's a Wonderful Life always playing on TV, and general unhappiness is evident. The elves, too, are annoyed at their continued work shift, and slack off on the job, producing a cow-bunny combination called the "Moo-Bunny". Easter and Independence Day aren't as fun anymore either. Also, obviously, the only Sesame Street resident of who isn't getting tired of Christmas every day is Oscar the Grouch. He loves to see all the broken toasters piled up by the Fix-It Shop, a whole lot of trash piled up by his trash can and there's nothing on TV but It's a Wonderful Life. He says it's a "bah, humbug" Christmas every day.
A year after that first fateful Christmas, the Fix-It Shop has gone out of business, and even Santa is about to retire from his job. Elmo decides to use his third wish to undo his second, but the snowglobe flies from his hands in a freak accident and smashes to the ground before he can make the wish. All looks lost, until Lightning flies Elmo back in time to the chimney, where Elmo decides to pass on the snowglobe, and winds up with the Moo-Bunny.