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Season's Greetings from the NACM Staff! Enjoy this timely submission to this year's Credit Words Contest:

Twas the Night Before the Recession

By Tom Muter, CCE

It was the night before the recession and all through the country,
Not a vendor, banker or customer was stirring, all were quite "comfy."
Mortgages were processing, financing easy and no unemployment to bear,
There were hopes that prosperity would always be there.

Credit managers, bankers and brokers were all "smug" in their beds,
While visions of more profits danced in their heads.
The farmers were dancing on ethanol dreams,
The price of corn would surely keep climbing it seems.

While out on Wall Street, there arose such a clatter,
And then Main Street suddenly joined in the chatter.
I hung to the radio, watched the TV; away to the Internet I flew like a flash,
Oh no! Oh no! My IRA and 401K had taken a crash.

Now something was abreast, and not just new fallen snow,
Is it the luster of mid-day...No! The market is really low!
When what to my wondering eyes should appear?
The Recession has come, it is definitely here!

But what were the drivers that brought it so quick?
This is not the work of "W" or his Vice President Dick.
More rapid than eagles its courses they came,
There was no whistling or shouting when they called them by name.

Now Freddie and Fannie, now Chrysler and AIG,
Now Merrill Lynch and GMC, and maybe G.E!
To the bottom the interest rates they did fall,
Now crash away! Crash away! Crash away all!

Mortgages were falling like lead balloons fly.
And more ARMs are going to reset and die.
So up to the Central Bank all our hopes flew.
Please, Please Mr. Bernanke what can you do!

And then in a twinkling, the election was on,
We need change! We need change! Was the cry of the throngs.
As I drew in my breath, and was turning around,
Washington was all a bustle: Obama's in town.

He was dressed as casual as casual could be,
He promised he was no different than you and me.
Many believed America would once again have an advantage,
What we need is an Economic Stimulus Package!

A bundle of changes he flung on our backs,
One of the promises...troops out of Iraq.
His eyes how they twinkled; his campaign was so merry,
A 1.4 trillion-dollar budget, oh, how scary, how scary.

How much credit to extend, it's so hard to know,
Which way, which way? Will the economy grow?
Sales are down wherever you go,
The season is coming when it will snow, snow and snow.

Credit managers everywhere are grinding their teeth,
Bankruptcies are up, it looks like more grief.
Profits are slipping 'cause revenues are down,
Should we be more liberal or shut the marginal accounts down?

The sales manager is griping; "Inventories are too low,"
I laughed when I saw him within myself.
Twas the night before the recession, the CFO arrived at my desk,
"What receipts are coming? Give me your best guess."

I cranked out the numbers with all I was worth,
While he sulked at his desk, then turned with a jerk.
"I'm drawing on the credit line to make cash flow,
But what will we do when it begins to snow?"

"Don't worry," he said. "Everything will be all right,
We'll hunker down with all of our might."
He sprang from the chair and let out a cry,
He leaned over close and looked me in the eye.

"The recession is here," he quietly whispered,
"We'll have to work harder, be smarter and be crisper!
And I heard him exclaim, ‘ere he walked out of sight,
"Merry Christmas to you...Have a good night."


In these uncertain times, it is extremely important to get with management, owners and directors to determine if the goals and strategies of the company have been or need to be restated. The goals and strategies are the most important part of the puzzle. They are the most determining factor on setting credit policy and procedures of the company in any economy, but especially in this economic climate.

If the goals and strategies of the company have not changed in this recession, then it is important to continue with the basic "tried and true" credit principles that have lasted over the years in all business climates and cycles:

• Investigate
• Process information
• Analyze the information carefully
• Monitor the accounts closely
• Communicate often with customers internally and externally
• React to changes

The second most important piece of the puzzle in these unstable economic times is to document, document and document. With the many pressures on the credit professional today, from sales, owners, management and customers, it is easy to get pulled into a bad credit decision. Make the correct credit decision based on solid credit management principles and the facts you have from your investigation, then remember to document your position in case others override your decision.

Revisit strategies and goals at regular intervals predetermined by owners and management.

Happy Christmas to all and to all a good night. Have a safe and happy holiday.

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