Tim Hazledine
Professor of Economics
“
The effects of the global financial crisis
on employment and profits in most OECD
countries have not been as severe as the
miseries of the stagflation period of the
late 1970s and early 1980s, which, in turn,
wasn’t as bad as the Great Depression.
Many of our national and international
institutions are coping with, or at least
mitigating, the damage (including our
government and our Reserve Bank).
And we’ve got the Asian powerhouses
–
an unprecedented phenomenon –
injecting some welcome juice into the
body corporate. Having said that, there is
no question that many organisations are
experiencing difficult times and in some
cases real pain. Will the global financial
crisis ever end? Of course it will. It always
has. If you don’t have faith in this, you
may as well cash in your chips and go
and live in a cave somewhere. The people
who make money will be those who
hold their nerve now, then get in first
on the upswing – just like the share
market investors who made heaps in
the recovery from the 2008 share
market slump.”
Nick Scott
Partner, Corporate & Commercial Law
Dan Hughes
Partner, Insolvency Law
“
While the economic conditions may not
be as bad as in previous recessions, there
is no doubt that we are in a prolonged
period of economic uncertainty, and
times are tough for many organisations.
Businesses need to ensure that their
debt positions are sound. We would
also advise organisations to assess the
positions of their suppliers, distributors
and key customers. They should ensure
that all security interests are registered,
and where they see potential risks, that
personal guarantees are obtained from
shareholders / directors. They might
want to consider reviewing their terms
and conditions, focusing in particular
on liabilities, termination, payment,
recovery and performance provisions;
and check how robust their processes
are for debt and stock recovery, and what
their liabilities might be if a supplier,
distributor or customer fails. In short,
check your contracts, your liabilities, your
securities and your ability to recover.”
key findings //
2:
changes in the economic cl imate cont. . .
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