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Durable Goods Definition. Durable goods are a category of tangible (physical) products that last three years or longer. Typically, these goods are a bit more expensive because they tend to last for long periods of time. Durable goods are also known as durables and consumer durables.
Consumer durables make up a portion of durable goods sales, so changes in purchasing trends are important economic indicators. Because durables tend to represent big-ticket items, consumers typically make these purchases when they’re confident they can afford them. Before a recession – when consumers have less confidence in the economy ...
The PCE price index measures the price fluctuations and related consumer behavior for all domestic consumption of durable and non-durable goods and services targeted toward individuals and households. The PCE 'core index ', however, excludes the more volatile components of food and energy. Personal consumption is divided into two key categories ...
Economic indicators can help investors decide where to put their money. For example, as the economy slows, countercyclical companies grow. Investors attracted to stocks in countercyclical industries are faced with the arduous task of trying to time the market -- that is, to predict the bottom of the business cycle to sell at the optimal time ...
Examples of individual assets include: Property/Homes. Jewelry/Collectibles. Cash and cash equivalents. Certificates of deposit (CDs) Investments including bonds, mutual funds, and retirement plans. An investor’s portfolio is a collection of assets. It is widely believed that an individual's portfolio should include assets from several ...
Gross Domestic Product (GDP) is a quantitative measure of how much an economy produces. It includes the monetary value of both goods and services within a specific nation’s borders. From cars to machinery to hairdresser services, GDP is a vital factor for understanding the financial health of a country. Investors often use GDP to determine ...
Yet economists are quick to strip out the impact of spending on airplanes, which is a big factor in durable goods production -- notably volatile. The monthly durable goods report, issued by the Commerce Department, is seen as a strong complement to the ISM's NAPM surveys noted above. Taken together, these economic reports provide a clear ...
Inflation, however, changes the value of money over time. Accordingly, constant-price GDP measures the value of a country's goods and services in relation to a base year. For example, let's say we want to measure the real GDP of Country A. In 2000, the country produces $55 of goods and services. If we set 2000 as the base year, any future GDP ...
Personal outlays can be defined as personal consumption or spending, including durable goods, non-durable goods, services, interest payments and mortgages. Here is look at the Personal Income and Outlay report from January 2011: graph courtesy of bea.gov. The Personal Income and Outlays report is published four to five weeks after the reported ...
Barter Example. The barter system enables two parties to exchange goods or services based on mutually perceived value. To illustrate, a plumber can fix a baker’s sink, for which the baker would normally have paid $100 for the service. Instead, the baker gives the plumber $100 worth of his baked goods. Another example would be a photographer ...