Financial Crisis
Wachtell Founder Says Rebound Could Take Up to Five Years
Posted Oct 27, 2008, 06:40 am CST
By Debra Cassens Weiss
One of the lawyers who founded Wachtell, Lipton, Rosen & Katz is predicting a long road to the nation's economic recovery.
Martin Lipton, a mergers and acquisitions lawyer, told students at New York University law school last week that the nation won’t see a recovery until the mortgage and housing market stabilizes and the value of bank assets stops declining, the Reuters DealZone blog reports.
“I don’t think that’s a matter than can be dealt with in a short period of time,” he said. “I’m afraid it will take three to five years before we can achieve that.”
Lipton predicted that the financial meltdown will result in lawsuits attacking corporate directors and reforms in corporate governance, the Reuters report says. Currently rules requiring independent directors have resulted in too many directors who don’t have enough experience in the industry they are overseeing, he said.
While Lipton was pessimistic about a quick rebound, he nonetheless said mergers and acquisitions will not go away, according to a report on the New York Times DealBook blog. “There will always be M&A,” he said, although corporate leaders are reluctant to push mergers in the current economy.
Hat tip to the American Lawyer.