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My apologies if you are receiving this e-mail a second time. Due to a technical problem, I am not sure if my service delivered this issue as scheduled on July 28. |
 The economic downturn has forced big law firms to cut salaries, lay off staff, and cut back on recruiting. Meanwhile, mid-size firms like Frantz Ward are in a better position to weather the storm. Why? Value. Big companies that typically turn to the prestige and high rates of BigLaw are now deciding that smaller is better. The Wall Street Journal confirmed as much earlier this month in its law blog. In 2007, large companies gave 25% of their work to firms with less than 200 attorneys. In 2008, that number rose to 38%. This should really give BigLaw reason for concern. It will be interesting to watch these statistics as the economy brightens, to see if those big corporations learn what our clients already know--the service that Frantz Ward provides is a value in a recession, in a recovery, and in a boom.
As always, if you have questions, comments, or suggestions relating to this e-newsletter, please let me know.
Jim Dixon
216-515-1642
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Housing Market Collapse: Is it Over Yet? Who Saw it Coming? Take a moment to look through the archive and you will see that, in addition to following the data relating to the housing market, I have also marveled at the inability of economists to explain what is happening, what has happened, and what will happen. Reports relating to this month's data show some uniformity, with economists generally indicating that we may have hit bottom because sales volume and prices are both inching upward. The New York Times quotes an economist stating that "We've found the bottom," while featuring a photo of a Cleveland development. The Wall Street Journal noted an end to 34 months of decline. The Christian Science Monitor wonders if it is finally time to buy.
And, an economist at the Federal Reserve Bank in Cleveland issued a report that addressed common myths relating to the crisis. Her findings are striking. While securitizers of sub-prime mortgages may have been surprised by the timing and magnitude of the crisis, many saw it coming because they had been gradually raising rates to address a growing perception of risk. And, while the subprime mortgage market reflected only 18% of mortgage debt in 2008, the bundling, splitting, and rebundling of securities amplified the problem.
The crisis has crippled or killed many of the area's most successful and sophisticated home building businesses. Let's hope the journalists and economists finally have it right, and that policymakers are able to learn from the Fed's report. |
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Ohio Relaxes Bonding Requirements for Minority and EDGE Construction Companies Included in the July 17 state budget was a program designed to improve the ability of minority-owned and EDGE enterprises to obtain contracts for public work. As we indicate in this client alert, the risk of this program is that public entities and subcontractors will suffer because they lack recourse to performance and payment bond sureties. |
