<A HREF="http://www.eweek.com/article2/0,1895,2242865,00.asp?kc=EWKNLNAV010308STR2">U.S. manufacturing shrank by the largest margin</A> in almost five years, despite news that the overall economy still grew in December, which marked the 74th straight month of expansion. The Institute for Supply Management's factory index, published on Jan. 2, fell to 47.7, from 50.8 the prior month. Any number above 50 signifies growth; any number below reflects contraction.

While the December numbers fell far below economists' expectations that the index would hold steady through the end of the year, they did not come completely out of the blue. According to the ISM, new orders, production and employment all fell below 50. Moreover, inflation--as measured by the Prices Paid index--grew despite the weakness in activity.