At their core, recessions are the ugly process of fixing imbalances that have come about because of unwise decisions by businesses, individuals or government leaders (or, often, all three).  People tend not to make the exact same mistakes repeatedly, instead finding new ones to make.

Neil Irwin, Washington Post Staff Writer, “Fed Looking at Another Rate Cut to Stem Crisis,” Washington Post, December 16, 2008.

Financial risk and legal risk often go hand in hand.  The headlines for most of 2008 were atrocious.  It started with rogue trader Jerome Kerviel in France at Societe Generale SA and a senior management more content with “profits” than the warnings flashed by its compliance system.  It ended in December with Madoff’s mother of all Ponzi schemes resulting in part by regulators more content with the status quo than the warnings.  In between were gigantic financial meltdowns, bankruptcies, and bailouts too numerous to name.

On the legal side of the coin, you can safely bet the mortgage that there will be more regulations than ever before once all of the financial life preservers have been handed out.  And before you think those bailouts are “gifts” you might want to note that the money does come with big strings attached, often with the practical effect of making Uncle Sam your new business partner.  Yes, the legal dimension can make a bad business situation worse.

In trying to find the bright spot amid the wreckage of 2008, I look to Aesop who said:

better to be wise through the misfortune of others than by your own. 

You know, the more I think about it, the more I like it.  It’ll make a good New Year’s resolution.  The only exercise it requires is an open mind.  Large portions are good for you.  You can partake any time and anywhere.

I’m in.  How ’bout you?

Have a joyful and blessed new year.

Cheers!

Hanna, The No Nonsense Lawyer

It will be 2009 before you know it and I want to take this opportunity to thank my growing list of Legal Literacy fans.  As you can see by the map in the lower right hand corner of this page, Legal Literacy’s reach is growing daily. 

In looking at the year in review I want to share with you the most read Legal Literacy posting of 2008.  See what others are reading, see what you might have missed, and share with a friend.

And the winners are:

#5.  The Last Lecture, The Yellow Brick Road, and the Wizard of Oz about the unintended Legal Literacy lessons of Last Lecture professor Randy Pausch of Carnegie Mellon University and what he had to say about the subject of contract negotiation. 

#4.  Spoiled and Smokin’ about how what you don’t know about saving electronic documents really can hurt you and one couple who learned that lesson the hard way.

#3.  Bookshelf Recommendations identifying resources by the foremost authorities aimed at improving business performance and compliance. 

#2.  The Difference Between Law and Ethics about how an English muffin can raise awareness.

#1.  Beyond the Law of the Jungle about the business advantages of a developed rule of law.