Credit Manager's Index hits record low in November

The seasonally adjusted Credit Manager's Index fell 2.6 points in November to a record low of 42.2, painting an "even uglier portrait of the economy" than October, according to the National Association of Credit Management.

The index is well below the 50 level, which is the point of balance between national economic contraction and expansion. The index is a monthly survey of the business economy from the standpoint of commercial credit and collections.

Eight of the index's 10 components dropped, seven set record lows, and all were below 50, according to a news release. The index has fallen a record 10.9 points in the last year, with much of the decline occurring in the past three months.

Both the manufacturing and service sectors set record lows, with manufacturing down 1.3 to 42.4 and services down 3.9 to 42.

"The macroeconomic data continues to describe an economy which is in bad shape and which seems to be deteriorating," said Daniel North, the chief economist who prepares the report, in the release. "It's little wonder that credit managers are seeing so much demand for trade credit, but at the same time, they are facing a very difficult business environment where their sales are deteriorating on the front end, and their customers can't repay them at the back end."

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