In some disappointing data for the United States economy, new orders for durable goods fell by 4% in January.  Durable goods are equipment that companies use to produce the goods that they make.  This may seem to be downturn in an economy that has been doing better, but all is not as bad as it seems.  In 2011, there was a tax credit that allowed for a 100% reduction for any equipment bought last year.  The Wall Street Journal said that demand for durable goods, is actually rising and that it is expected to continue to rise.  One reason that is given, is an important aspect of the suppy curve; technology.  Companies are upgrading their technology so that they may be more efficient and not need as many workers.  This should cause a shift in in the suppy curve.  In 2011 there was a shift out in the demand curve due to the tax credit.  While it is not exactly a change in income for the companies that bought the durable goods, I think it can be classified as such since it did affect their overall budget.  I would conclude this piece by saying that i expect the demand to rise soon and for it to continue to rise for at least the rest of 2012.


Source: http://blogs.wsj.com/economics/2012/02/28/equipment-demand-hasnt-dropped-out-just-taking-a-breather/?mod=WSJBlog&mod=marketbeat