NACM Heartland Fall Newsletter

ALL GOOD THINGS MUST COME TO AN END

by Norman Honas, Board Chairman

Two years ago, when I took on the responsibility of board chairman, we had two goals in mind:

maintain and grow our numbers.
continue educating our members on how to manage credit risk with customers.

Change during these years has been constant; ongoing coronavirus, supply chain issues, higher inflation bringing higher interest rates, slower payment history, and multiple entities with growing bankruptcies. The need for sharing and obtaining information has never been more important.

Credit exchange groups and networking with our peers lay the foundation of tools to assist our members with managing risk, while group outings and Credit Congress provide opportunities to further build and strengthen our relationships. Providing these outlets to share our knowledge will continue to maintain what we have built, attract a new generation of credit leaders, and foster environments to learn from each other.

Reflecting on my involvement with NACM starting in 1989, I highly recommend that at some point in your career you raise your hand to serving on the Heartland Board. It’s an incredible opportunity to give back to the industries that we serve, the employees and companies we represent, and it strengthens your personal resume. I also recognize the countless times when I have utilized our resources to reduce bad debt issues within my company, and I am confident that opportunity will be there for others in the credit industry for years to come.

Norman Honas is the Credit Manager for Helena Agri-Enterprises, LLC and NACM Heartland Board Chairman. THANK YOU, Norm, for your service and leadership to NACM Heartland.

Early bird registration pricing is available through December 8, so register now for the best pricing!

Again this year each fully paid delegate is welcome to bring a colleague from the same company who has never attended Credit Congress before—for only $249!

The NACM Heartland board of directors is once again offering two scholarships to qualified applicants. Download the application here and submit no later than December 1 to Maggie.

2023 ANNUAL NACM HEARTLAND ROUNDTABLE

LUNCH & LEARN

Nov 16, 11:30 AM – 1:30 PM

Des Moines Golf & Country Club 1600 Jordan Creek Pkwy,

West Des Moines, IA 50266, USA

Join us for our annual opportunity to exchange ideas, tips and best practices. Led by members of our board, this will be a fun and lively discussion about topics important to you.

For more information and to register, please visit our website.

Will a Soaring Federal Debt, Overspending Consumers, and Bond Vigilantes Bring on the Recession?

by Ernie Goss, Ph.D.

In December 2022, 75% of economists surveyed by the National Association of Business Economics predicted a 2023 recession. Furthermore, the yield curve, which is equal to long-term interest rates minus short-term interest rates, has now been negative for 15 straight months due to the Federal Reserve (Fed) aggressively raising short interest rates above long-term rates. This is the longest period on record of a negative yield curve without a recession. Furthermore since 1955, an inverted yield has preceded all 10 recessions. Have economist and the yield curve lost their predictive punch?

Contrary to this gloomy outlook from economist naysayers and the yield curve, the U.S. economy added 1.54 million jobs and expanded GDP at an annualized 2.0% pace in the first half of 2023. Placing more nails in the 2023 recession coffin, the Atlanta Federal Reserve’s GDPNow model estimates third quarter GDP growth will come in at a very healthy 5.4%. And the October 2023 retail sales report showed that the U.S. consumer is spending at a breakneck pace with September 2023 retail sales advancing by 0.7% from the previous month. Even after subtracting out inflation for the month consumer spending on retail items expanded at a healthy 0.4% for the month. Thus, rapid expansions in GDP, consumer spending, and jobs indicate no 2023 recession. Were economists and the yield curve wrong, or just early?

But why no 2023 recession? Between the beginning of the pandemic in Q1, 2020 and Q3 2023, the Federal Reserve boosted the nation’s money supply by 40% and the federal government increased the national debt from $22.7 trillion to $30.9 trillion. Both actions flooded the consumer with spending power. But the “pig is in the python” as recent the dollar inundation is reversed pointing to an economic downturn as early as the first quarter of 2024. The following will vacuum a large portion of the earlier excess spending:

40 million student borrowers must begin loan repayment starting October.
Credit card debt rose between Q1 and Q2 of 2023 to a record high $1.03 trillion thus taking away punch bowl from the consumer spending bash.
Auto loan payments and monthly mortgage payments are skyrocketing thus cooling consumer revelry.
The Federal Reserve has begun reducing the green backs in the hands of consumers.

Table 1 shows the extent of this exploding debt emphasizing the impending economic pain for consumers. Will bond vigilantes discipline this overspending?

Ernie Goss, PhD is the Jack MacAllister Chair in Regional Economics at Creighton University and served as the initial director for Creighton’s Institute for Economic Inquiry. He is also principal of the Goss Institute in Denver, Colo.

If you need your survey link resent, please email Lindsay.

CALENDAR

OCTOBER

10-24 UCC Filing in the Foodservice, hospitality, and Beverage Industries Webinar

10-25 The Time Is NOW to Review and Update Your Credit Webinar

NOVEMBER

11-6 Certification Exam Date

11-6 Year-End Closing Best Practices Webinar

11-7 Understanding Lien Waivers Webinar

11-10 NAR Great Lakes Credit Exchange Jamestown Township, IN

11-13 Steel Group Credit Exchange TBD

11-14 The Basics of UCC Process Webinar

11-15 Construction Credit Exchange Zoom

11-15 Information Literacy: How It Affects You Webinar

11-16 NACM Heartland Roundtable Lunch and Learn West Des Moines, IA

11-16 I’m Ready to File a Mechanic’s Lien, But Management Is Against it Webinar

11-20 5 Things to Kickstart Your Educational Journey Webinar

11-28 The Basics of the Lien and Bond Claim Process Webinar

11-30 Author Chat- Everything You Need to Master Authentic Public Speaking Webinar

DECEMBER

12-5 Securing Mechanic's Lien Rights in Notice of Commencement States Webinar

12-11 Take Your Game to the Next Level—Using Emotional Intelligence to Advance Your Career Webinar

12-12 When and If to Help a Distressed Contractor Webinar

12-13 Get Yourself Ready for 2024: Goal Setting and Future Planning Webinar

12-14 NACM Heartland Board Meeting & Christmas Dinner Des Moines, IA

12-18 5 Things to Know Before Implementing a New Software Webinar

JANUARY

1/2-4/19 Accounting Online Course - Winter 2024

1-12 Application Deadline for the March 4 Test Date

Visit our website for more information!

To keep up with current news and NACM events, make sure to check our website and twitter feed regularly.