Editor's Comment: After the crunch
In times of great uncertainty and jarring upheaval, it pays to remember what you can still be certain of. So, let's for a moment assume - and it is a big assumption - that the credit crunch has entered its closing chapter after the dramatic announcement in recent days of widespread government intervention. The credit market will still be strained for months and debt will be harder to come by than during the binge years of 2006-07. But charting the beginning of the end of the remarkable 15-month period for global markets would take the unknowable uncertainty of market collapse off the table. That obviously is a big positive but what does that leave law firms facing? First up, it is likely the usually busy September-December period of transactional activity will be deathly quiet, leaving the only deals being done as those with rock solid fundamentals, bids too small to be affected or deals happening because of the market. That means elite law firms, benefiting in the short term from a wave of bank rescues, capital injections and major insolvency work will do OK in 2008-09. For firms outside that bracket, the deals market, which had until the summer held up well, is likely to be much tougher, so the key question will be how the market begins to settle down come January. It also means that making predictions for your April year-end right now will be fairly pointless.
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