MarketWatch wrote this headline a little early. AmEx closed down 5% today. 4,000 jobs is nothing to sneeze at, but the move is still likely to be insufficient. Consumer credit defaults are on the rise, and this isn’t likely to change.

AmEx cards are attractive to a lot of small businesses. I had one for the first company I worked for out of college (and have one with my current employer). One benefit for small businesses is that AmEx gives a copy of your receipts to your company accountant. This makes reimbursement requests easier. Also, failure to pay impacts the employee’s credit, not the company’s credit. This is important if you have some yahoo at your company putting designer sunglasses on the company card. The onus to submit an expense report or pay the bill is placed on the employee. As far as I know, those are the benefits.

As I said, the first company I worked for out of college used AmEx (they switched from the company Visa card after some yahoo bought designer sunglasses and failed to submit an expense report for a month or two). This company had cash flow problems (many small businesses do). AmEx was not the highest priority when cash was tight. It took phone calls threatening cancellation to get the bill paid on more than one occasion.

I mention this because I believe that AmEx customers are going to exhibit similar behavior to the company I worked for. American Express markets themselves to exactly that type of company. As a consequence, I wouldn’t be surprised if the AmEx default rate was actually higher than the industry average. Companies will typically cover payroll before their company credit cards.

I don’t believe that we’ve hit the bottom in the economy. As a consequence, I think that the worst for AmEx lies ahead.