The September report of the Credit Managers’ Index (CMI) from the National Association of Credit Management fell in September to 54.9 from 56.7. While still firmly in the growth category, this is the lowest reading in nearly two years. Not even the “Polar Vortex” months of bad winter weather early in the year were as weak, NACM says. The collapse was felt in a variety of categories.

“This was not a small reversal of fortune by any stretch of the imagination,” said NACM Economist Chris Kuehl. “This could be termed a collapse, and it begs a very important question—which is correct: the Purchasing Managers’ Index or the Credit Managers’ Index?”

In past years, Kuehl said the CMI tends to predict the pattern that will be seen in the PMI in the next month or two. “If that assessment continues to be accurate, the economy as a whole may be in for a very rude awakening,” he said. “The numbers this month are almost shocking, and there will be intense interest in what the index reports in the next iteration, as this will determine whether this is the start of a depressing trend or just one of those anomalous months. The one factor that may provide some hope is that August and September are often difficult to get an accurate read on, given the vagaries of the summer break and the return to school.”

The index of favorable factors hung onto the 60s, falling from 63.8 to 60.9. The index noted that one of the big declines was in sales, which fell from 64.8 to 60.9, a low going back to March. New credit applications went from 60.9 to 59.0. Though not a huge drop, it is now below 60 for the first time since May.

Dollar collections went from 62.7 to 59.9, a more substantial drop out of the 60s. Amount of credit extended fell as well, from 66.7 to 64.0. This may have more to do with a surge in the past than any comment on the situation right now, Kuehl said.

Several unfavorable factors worsened, indicating possible business distress. The index fell from 52.1 to 50.9, dangerously close to slipping into contraction territory. Rejections of credit applications actually improved from 51.9 to 52.5, bringing speculation that some companies got a little looser with credit as sales started to sag. Accounts placed for collection fell from 52.1 to 50.7, which worries many in the credit industry, as it appears that some of the accounts in trouble likely were in decent shape not long ago.

Disputes increased, causing the factor to slip into the contraction zone—from 50.6 to 49.2. Dollar amount beyond terms also plunged into negative territory, from 50.3 to 47.2. This is one of its sharpest drops all year, and a low not seen in almost two years.

Dollar amount of customer deductions also declined. It has been sinking for a while and is now sitting at 49.8. Filings for bankruptcies went south as well, moving from 57.5 to 55.8. The numbers may signal more distress to come, Kuehl said.

The data for the second quarter GDP gets better with every revision and there have been improvements in everything from capacity utilization to employment. “Has this boom come to an end already? Are these good numbers from the economy not much more than a last gasp before sinking again?” Kuehl said. “Right now, the CMI data would seem to suggest this, but next month could be a different story.”