Tuesday, August 31, 2010

A Break Down Of PCEs

What do we spend money on? To answer that question, let's take a look at personal consumption expenditures, or PCEs. These are the largest component of the GDP report. Click on all images for a larger image

First, note that PCE expenditures are broken down into services, non-durable and durable expenditures.
Services is the largest area of expenditures, accounting for 65% of PCEs. The three largest areas of service expenditures are housing, health care and "other".
After the "other" category in the non-durable category, we see that food, clothing and energy are the largest expenditures of the non-durable category.


And in the durable goods category, we see that recreational goods (think really big toys), cars and furnishings are the biggest components.





When we put all of this together, notice that housing and health care are the biggest areas of expense. Food and beverages for "off premises consumption" and financial services are also large areas of expense.