Doing the Dow Shuffle

QIsaw that ExxonMobil was removed from the Dow Jones Industrial Average. What happened? — G.V., Tulsa, Oklahoma

AMany don’t realize this, but the Dow Jones Industrial Average (“the Dow”) is an index of only 30 companies. Every few years, to better reflect our diversified economy, some components of the Dow are ejected to make room for new ones. The latest move replaces ExxonMobil, Pfizer and Raytheon Technologies with Amgen, Honeywell and Salesforce. These changes reduce the index’s exposure to energy and traditional pharmaceutical companies, while increasing representation of technology and biotechnology.

In 2018, General Electric was shown the door to make way for Walgreens Boots Alliance, while Apple replaced AT&T in the index in 2015. The last major shakeup occurred in 2013, when Alcoa, Bank of America and HewlettPackard departed, making room for Goldman Sachs, Nike and Visa.

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QWhat’s

deflation? — L.U., Federal Way, WashingtonAprices We which over all time. is know the As steady about you rise inflation, might of have suspected, fall. good That thing, might deflation because seem is falling like when purely prices prices a your mean income. you can buy more with though, Deflation as it often isn’t always accompanies good, a omy. recession It can and/or be part a struggling of a cycle econ- where many people are out of work: They postpone purchases because they’ve lost income, then companies lower production due to reduced demand, then even more people lose jobs. In a deflationary spiral, the economy contracts rather than grows. Meanwhile, businesses (and people) earning less money can have trouble paying down their debts. Deflation can be countered by lowering interest rates, but rates can only fall so far.