the business cycle refers to the fluctuations in economic activity that an economy experiences over a period. it consists of expansions, or periods of economic growth, and contractions, or periods of economic decline. during expansions, employment, production, sales and incomes increase. during contractions, also called recessions, unemployment rises, production slows, sales decrease and incomes stagnate or decline. the housing boom of the 2000's is an example of the expansionary part of the business cycle. the great recession that followed which technically lasted from december 2007 to june 2009 is an example of the contractionary part of the business cycle. the national bureau of economic research determines the official dates for business cycles in the united states. it calculates that since 1945. the average expansion has lasted about 58 months and the average contraction has lasted about 11 months. however, since the 1990's, the average expansion has lasted 95 months, while the average contraction has still been just 11 months. investors who think they can time the market may be able to profit from business cycles by choosing the right stocks. ? knows that cyclical stocks, such as commodity and technology stocks, tend to outperform at the bringing of an expansion. so she tries to purchase them at the end of the contraction when they are underpriced, then sell them at a profit in the early part of the expansion. when ? thinks the economy is overheating, she buys healthcare, consumer staples and utilities stocks which tend to outperform during recessions because of their stable cash flows and dividend yields. many economists consider the business cycle to be a natural part of economic activity. some economists, however, believe that if the central bank did not manipulate interest rates and the money supply, business cycles would be less severe or might even disappear altogether.
- business cycle・・・景気循環→https://ja.wikipedia.org/wiki/%E6%99%AF%E6%B0%97%E5%BE%AA%E7%92%B0
- national bureau of economic research・・・全米経済研究所→https://ja.wikipedia.org/wiki/%E5%85%A8%E7%B1%B3%E7%B5%8C%E6%B8%88%E7%A0%94%E7%A9%B6%E6%89%80
- cyclical stock・・・市況産業株