Consumer Nondurables and Services
Categories: Index Funds, Investing
You’ve got durables...stuff that lasts a long time. The pyramids, Notre Dame cathedral, Tom Brady...and there’s the stuff you can buy: cars, refrigerators, jet engines, mail-order spouses.
Then you have nondurables. These are more disposable items...toothbrushes, razors, paper towels, plastic sporks, Tinder dates. They don’t last a long time. They're largely disposable. But they tend not to be very expensive.
Economists look at orders for durable goods as a good indicator of the strength of the heavy manufacturing sector. They look at orders for nondurables too, but take the number less seriously.
Demand for nondurables tends to remain steady even in times of economic stress. People still need (and can afford) things like toilet paper and Q-tips, even in the face of a recession. They may cut back, or buy cheaper brands...but the dip will be less pronounced than with durables.
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Econ: What are Consumer Nondurables and ...3 Views
And finance Allah shmoop what Our consumer nondurables and services
a durable and something that lasts a long time You
know like the pyramids Notre Dame Cathedral Tom Brady and
their stuff you can buy that lasts a long time
Like cars refrigerators backhoes of jet engines Who When Elsa
medieval torture devices for your basement All durable Well their
products meant toe last at least three years Will you
buy them today And you're likely to have them for
the foreseeable future Then you have nondurables Well these You're
more disposable items you know like toothbrushes razors paper towels
plastic forks tinder dates L they don't last a long
time And they tend Teo will not be very expensive
right Like they're kind of throw away dollars services fall
under a similar category as nondurables like get a haircut
And now you're good for a few months Well maybe
if you're these guys you're good for three years or
more But usually you'll be back for a service in
a short period of time Well economists look at the
numbers related to durable and non durable goods differently The
goal of economic statistics usually is to read Well what's
going on in the economy And generally experts feel the
stats for durable goods say a lot more about the
economy than those for nondurable goods Right Like you have
to think really hard about a very expensive durable thing
You'll keep forever figures for durable and nondurable goods Both
get reported on a monthly basis but the stat for
durable goods orders gets far more attention than a similar
readings for nondurables Even in bad economic times people can
probably still afford things like raisers and toilet paper Let's
hope aura as Este Lauder used to say You know
a new lipstick but they might put off buying that
new car or refrigerator or you know new pontoon boat
So in recessions you might see a sharp drop in
durable goods orders while nondurable goods remain in really stable
Orders in the nondurable category might dip a little but
the impact won't be a sharp right Well again people
can put off those big durable goods purchases if they're
looking to save money and then not so hopeful right
now But maybe we'll be in the future something like
that But the smaller nondurable goods are more immediate kind
of hard to get along without him for any length
times people just buy him good times and bad Meanwhile
the economic performance of these stats are tracked in dollars
The prices of the average nondurable is much less than
the average price of a durable good right like razors
cheaper than washing machines So the falloff in the durable
goods stats will look even more dramatic So that's how
things roll You might lament the disposable consumerist society You
might think that the best thing would be to go
to a mountaintop somewhere and spend your days meditating But
when push comes to shove and the economy is in
crisis well people will always choose their more disposable goods
It's a stuff that gets us through the day Thank 00:02:54.695 --> [endTime] goodness I do