Producer's Durable Equipment and Structures
Categories: Econ
It sounds like the incredibly literal name for a farm equipment and barn construction company, run by a guy named something like Ralph Producer.
Instead, Producers' Durable Equipment and Structures refers to a highly specific type of business spending. It's probably best to break it down step-by-step. So, uh...that’s what we’ll do.
First: durable equipment.
Manufacturing products often get sorted into two main categories: durable and non-durable. Durable goods are those meant to last a long time. The usual definition calls for an item meant to last at least three years. So, for consumers, we're talking things like cars and washing machines and electric salad spinners.
Non-durable goods are more disposable. Think: products like paper cups and toilet paper and odor-neutralizing shoe inserts.
Second: the "producers" part. Some manufactured goods are made for regular people to buy for use in their day-to-day lives. That stuff gets the title "consumer goods." A different category applies to items made for other companies to buy for use as part of their operations: "producer goods."
A blender that can make 5 margarita servings: a consumer good. A giant, room-sized blending vat that can make 5,000 gallons of margaritas: producer good.
Producers' durable equipment is equipment meant to last a long time, and to produce on a large scale. It's not for consumers...it's for other producers. At the odor-neutralizing shoe insert factory, we're talking about the big stamping machine that cuts the foamy material into foot shapes. Or the giant sprayer that squirts anti-stink juice onto the foot-shaped foamy things.
Those are examples of producers' durable equipment.
Third: the "structures" part.
Structures have to do with buildings. Like, actual structures...places people work, or which get built as part of a factory campus. The buildings. The offices. The gazebos out by the tennis courts, where the string quartet plays. Well, that last one is more for the Googles and Apples of the world. But...it still counts. So the Producers' Durable Equipment and Structures refers to business spending on long-lasting manufacturing equipment, or on the physical buildings used by the company.
Basically, it tracks large capital expenditures by companies. It's the amount businesses spend on their big-ticket equipment, or on their physical structures. The large items in which a company has to invest in order to...do what they do. Economists track this number as a sign of the health of the manufacturing industry. If companies are willing to make these big purchases...it’s a good sign.
These purchases often require borrowing money. Companies also need confidence that they'll get years’ worth of use out of the equipment and/or structures. So the fact that the firms are making the purchases bodes well for the industry as a whole. On the other hand, if companies are reluctant to make these purchases, it’s a bad sign for the industry. It shows a lack of confidence. When the figures for Producers’ Durable Equipment and Structures go down, the economy could be in trouble.
So...the shoe insert company decides to ditch its aging anti-stink-juice sprayer and, instead, borrow money to purchase the brand new, Internet-enabled, A.I.-designed TechStink Spurt X 9000. The move shows up as part of the national statistics on Producers' Durable Equipment and Structures.
Good sign for the economy. Businesses are showing confidence in the future. Or it could just indicate that the odor-neutralizing company sees ongoing demand for its specific product. Because feet are, uh...eternally rancid.
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And finance Allah shmoop what our producers durable equipment and
structures It sounds like the incredibly literal minded name for
a farm equipment and barn construction company run by a
guy named something like Ralph Producer But instead no producers
Durable equipment and structures refers to a highly specific type
of business spending It's probably best to break it down
step by step So yeah that's what we'll do first
Durable equipment While manufacturing products often get sorted into two
main categories durable and nondurable durable goods or those Mento
last a long time right The usual definition calls for
an item Mento last at least three years So for
consumers were talking things like cars and washing machines and
electric salad spinners and senators Nondurable goods arm or disposable
Think products like paper cups and toilet paper and odor
neutralizing shoe inserts You know stuff like that Durable equipment
equipment meant to last at least three years So now
the producers part Some manufactured goods are made for regular
people to buy for use in their day to day
lives Well that stuff gets the title Consumer goods A
different category applies to different items made for other companies
to buy for use as part of their operations It's
called producer goods Yeah that's the category A blender that
can make five margaritas servings Consumer Good A giant room
sized blending that that can make five thousand gallons of
margaritas Producer Good So yeah producers Durable equipment is equipment
meant to last a very long time and to produce
on a large scale It's not for consumers It's for
other producers at the Oder Neutralizing Shoe Insert factory while
we're talking about the big stamping machine that cuts the
phony material into you know foot shapes or the giant
sprayer that sports anti stink anti stink Jews technically onto
the foot shaped foamy things those are examples of producers
Durable equipment Now the structures Sparta will structures have to
do with buildings shockingly like actual structures places people work
or which get built as part of a factory campus
right the buildings the offices the gazebos out by the
tennis courts where the string quartet plays well That last
one is more for the Googles and Facebook's of the
world But well it still counts So the producers durable
equipment and structures refers to business spending on long lasting
manufacturing equipment or on the physical buildings used by the
company well basically attracts large capital expenditures by Cos It's
the amount businesses spend on their big ticket equipment or
on their physical structures The large items in which a
company has to invest in order to you know do
what they do While Economist track this number is a
sign of the health of the manufacturing industry If companies
are willing to make these big purchases it's generally a
good sign of what's to come with the economy right
Thes purchases often require borrowing Money Cos also need confidence
that they'll get a year's worth of use out of
the equipment and or structures and that they're optimistic about
their futures So the fact that the firms are making
the purchases bodes well for the industry as a whole
and usually where the industry goes so the economy goes
right On the other hand if companies are reluctant to
make these purchases it's a bad sign for the industry
and or the economy It shows a lack of confidence
when the figures for producers durable equipment instructors go down
while the economy likely is going to be in trouble
In the future So the shoe insert company decides to
ditch its aging anti stink juice sprayer and instead borrow
money to purchase the brand new Internet enabled A I
designed texting spurt X nine thousand The move shows up
as part of the national statistics on producers durable equipment
and Structures Yeah good thing Good sign for the economy
Businesses are showing confidence than in the future Or it
could just indicate that the odor neutralizing company sees ongoing
demand for its specific product Because feet are well you
know eternally on Iran's in there you just spray it 00:03:59.32 --> [endTime] Oh yeah