Confidence is a funny thing. In business there is often too much of it, leading to bull-market excess, or too little, causing self-destructive flagellation. It is also another established rule that sentiment undershoots and then over-reacts before finally levelling out at somewhere near reality.
It is a theory that you can apply to law firms. Legal Week‘s quarterly business confidence poll last October, the first since the onset of the credit crunch, showed confidence bizarrely unchanged from boom-time levels, despite a string of gloomy headlines. By this month’s poll, conducted days after the fire sale of Bear Stearns, confidence had plunged across the board.
