The Institution of Supply Management's December Manufacturing Report is out and it ain't pretty.

PMI @ 32.4% and dropping like a stone.

Manufacturing activity continued to decline at a rapid rate during the month of December. The decline covers the full breadth of manufacturing industries, as none of the industries in the sector report growth at this time. New orders have contracted for 13 consecutive months, and are at the lowest level on record going back to January 1948. Order backlogs have fallen to the lowest level since ISM began tracking the Backlog of Orders Index in January 1993. Manufacturers are reducing inventories and shutting down capacity to offset the slower rate of activity

It appears the rate of shrinkage is also increasing. Looks like a cliff in some many words.