Dominos

The large consumer product companies, of which automotive is the largest, were the first hurt by the credit crisis and then by the consumer confidence crisis. Now watch as their contractions affect the rest of the economy: (By Courtney Schlisserman and Bob Willis,Dec. 15 (Bloomberg))

Manufacturing in the U.S. slumped further in November as exports tumbled and automakers slashed their assembly rate to the lowest level in more than 18 years.

As consumers tighten their belts, so do the companies:

“Companies are cutting back on investment, capital, inventories and production and you should see this number going down,” said Lindsey Piegza, a market analyst at FTN Financial in New York. “The crisis has spread to all parts of the production line and we’re really going to have to cut back more.”

Well, at least exports will remain strong. Right?

As a recession spreads across the globe, the overseas demand for American products that had sustained U.S. manufacturing growth is drying up. The Commerce Department reported last week that American exports declined in October for the third straight month.