Credit Index Slips

The seasonally adjusted credit managers index published by the National Association of Credit Managers fell in November, a trend that adds to concern about the economy slipping into recession.

The NACM said the index decline, while relatively small, cut across a number of sectors. Five of the six "unfavorable factors" judged by participants in the survey fell to a level below a score of 50 in November, which the NACM says indicates a contraction.

"This is the first time that there has ever been more than four components indicating contraction since the inception of the CMI in 2002, and it could well be a harbinger of things to come," said Daniel North, chief economist with credit insurer Euler Hermes, in a news release.

Mr. North said that lower housing values, high gasoline prices, the crumbling value of the dollar and weak consumer confidence are giving credit managers the jitters.

He said the accumulation of worrisome signs means that credit managers "are facing tougher times ahead.

"As has been the case for months now, comments from the survey participants were mostly about the terrible conditions in the housing market, but this month there are some unhappy comments from other industries as well, indicating more widespread weakness," Mr. North said.

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