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Media Contact: Caroline Zimmerman, Editorial Director, 410-740-5560, carolinez@nacm.org

Credit Managers’ Index Celebrates 10 Years of Remarkably Accurate Economic Predictions

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Columbia, MD: February 1, 2013—The January report of the National Association of Credit Management's (NACM's) Credit Managers' Index (CMI) marks its 10th-year anniversary of providing financial professionals, economists and policymakers with a startlingly accurate forecasting tool.

Since its inception in January 2003, the CMI's methodology has undergone a number of revisions, but never stopped being an immensely powerful economic predictor. In 2007 it was even able to tip analysts off to the start of the Great Recession in December 2007, showing a noteworthy decline in October of the same year.



Throughout the recession, the CMI reflected a remarkable sensitivity to the intricacies of the economic downturn, and resisted the month-to-month swings that characterized other economic indicators. Eventually it anticipated the recession's end as well, showing signs of market stabilization and nascent growth as early as February 2009, while the actual recession came to an end four months later in June.



NACM Opposes Virginia Bill That Would Cool Exchange of Commercial Credit Information

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HB 2198 Would Create New Problems, Fail to Fix Small Business Concerns

Columbia, Maryland – February 14, 2013: A bill in the Virginia House of Delegates would create new problems throughout the commercial credit industry while failing to address the concerns of Virginia's small businesses, according to the National Association of Credit Management (NACM). The bill, HB 2198, sets up a lose-lose proposition for businesses well beyond the borders of the "Old Dominion."

HB 2198 was recently forwarded to the Virginia Small Business Commission and would, among other provisions, require commercial credit reporting agencies to identify the source of any negative commercial information. It is a move that would immediately reduce the amount of information available to commercial trade creditors; information that helps determine a customer's creditworthiness. Open, accurate reporting of trade credit information, without fear of retaliation, is necessary for businesses to offer the financing to other businesses that drives America's business economy.

NACM's Credit Managers’ Index for January Falls Slightly to 54.6

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The National Association of Credit Management’s (NACM) CMI for January 2013 signals a transitioning economy.

Columbia, Maryland: January 31, 2013—On the surface there appears to be little change this month. The shift in the Credit Managers’ Index (CMI) was very minor, falling from 54.9 to 54.6. On closer examination there was a lot going on, reflecting that the economy is essentially in a transition mode again. The last time this kind of variety appeared in the National Association of Credit Management’s (NACM’s) index of ten factors was during the months that preceded the slide into recession in 2008. For every sign that things were deteriorating, there was a part of the index that looked solid and unaffected by the impending crisis. Now that transition is showing again, but this time it seems to be pointing in the other direction. For every factor that suggests the economy is still in the doldrums, there is one or two that point to better days ahead.

To begin with, sales improved to 58.6, which may be the most positive sign of all. For eight of the prior 12 months, the sales number had been over 60. That started to reverse in September 2012 when it fell to 59.5, with the worst occurring in December when sales fell to 56.7, a level not seen in over a year. Now it has rebounded and, while not in the 60s yet, it’s headed in the right direction.

Credit Managers’ Index for December Declines Slightly to 54.9

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Columbia, Maryland: December 28, 2012—As it did in October, the Credit Managers' Index (CMI) from the National Association of Credit Management (NACM) slipped again this month, from 55.2 to 54.9. The most dramatic movement was in sales, which plummeted to 56.7, a low last seen in December 2009 and almost a full point lower than in October 2012. This reinforces the notion that business is stalled out in anticipation of what might happen with spending and taxation next year. There was some cautious optimism just a month ago, but that optimism has evaporated, as it seems all but certain that there will be no settlement of lasting value on the "fiscal cliff."

Credit Managers’ Index Makes Back Most of October’s Loss, Jumps to 55.2

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The National Association of Credit Management's (NACM) economic report for November 2012 regained the loss experienced in October, showing a return to form in key factors.

Columbia, Maryland: November 30, 2012—The Credit Managers' Index (CMI) reading of 55.2 for November is still shy of the high points reached back in February and March (55.8 and 56.2, respectively), but is back to the levels seen in August and September. When the reading from October fell to 54.4, there was a sense that it may have been an anomaly, and not as dangerous as it would appear. Now that assessment looks more accurate.

The most important jump was in sales, which climbed from 57.4 to 60.4. It is always encouraging to see the data cresting past 60, and this marks the best sales month since August when the reading was at 62. However, the best improvement in the favorable factors was in dollar collections, as it improved from 54.6 to 61.3. "That is an impressive showing by any measure, and suggests that companies are seeing enough improvement in revenues to start catching up on their debt," said Chris Kuehl, PhD, economist for the National Association of Credit Management (NACM), who added that the full-point improvement in amount of credit extended signals more demand from reliable customers than in the past few months. This is a noted pattern, he said. "As companies begin to get current on their credit, they are often motivated by the need to ask for more credit for expansion. First they catch up and then they ask for more credit and that appears to be happening again." The only favorable factor that weakened was new credit applications, which fell from 56.6 to 56.5.

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