The story starts before Christmas, and Greg wants to behave well to get really good gifts for the holiday. In addition, his mother obtains a doll which she calls "Santa's Scout" that is meant to keep track of how he behaves and make his behavior better. Greg is afraid of this doll because his brother makes fun of him using it.
Greg starts playing a game called "Net Kritterz" that is based on treating a virtual pet and requires paid features. Susan doesn't want to give Greg money for that purpose so he has to earn money on his own. Greg tries some bad ideas for getting money until he finds out that he can buy "Drummies", tasty fried chicken snacks that are sold in his school's holiday bazaar, for less than his school sells them for, so he decides to start his own holiday bazaar and invites his best friend Rowley to do it with him. They first try to build a cardboard home-made version of Pac-Man, but their plan fails as the cardboard of the game falls apart. They then realize they need to advertise their bazaar and they try to ask the local newspaper to do it. However, they find out that this is very expensive, so they try to establish their own newspaper. Their newspaper doesn't succeed, so they decide to hang up posters that advertise their bazaar in their town, starting with the school, but rain causes all the ink to bleed on the school's walls, leaving multicolored stains that won't come off. The school administrators and police start looking for the cause of the "vandalism": they ask the whole student body to tell them who did it anonymously. Rowley leaves a note at the principles desk anonymously saying "Me and Greg Heffley vandalised the school" (due to Rowley's naivety and stupidity) so the only one who gets in trouble is Greg. As a punishment, the principal makes Greg clean the walls, which takes him two hours.
A sudden blizzard hits their town so all of Greg's family have to stay home, except for his father who can't return home from work, so he stays in a hotel near the highway. The electricity goes off and his family becomes extremely cold. After several days of no power, Rowley comes and tells Greg that everyone else in their street has electricity, so Greg checks the power box. Greg realizes that the power is shut down in all of the rooms except for Manny's room. Greg finds Manny living luxuriously in his room surrounded by food, warmth, and toys without notifying his family because, as Manny claims, nobody taught him how to tie his shoes. Susan switches the power back on, and the blizzard soon ends, but Manny escapes punishment, to Greg's dismay. Greg's father returns home with food.
Afterwards, Christmas comes and Greg looks for the gift for which he asked in the giving tree of his church by shoveling all the snow near the church. This results in an article in the local newspaper praising him for helping residents by shoveling off all the snow.
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