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March 10, 2017

Recession: "Every cloud has a silver lining"



Recession is fully part of human life, but it’s unfortunate that until every Tom, Dick and Harry proclaims it, we all denied the existence. Maybe you are confused about what I mean. Before the clarity, let us look at the definition of recession.

Recession is known to be a period of temporary economic decline, during which trade and industrial activity are reduced, generally identified by a fall in GDP for two successive quarters (6 months). Now apply this definition to your personal economic and financial situation either now or in the past and see if you can correlate it.

No doubt and no argument that recession is bad for business and to us personally but while the general public focus on the negative impact of recession, the few smart ones take the advantage it created.  In 2009, The Kauffman Foundation sponsored a study that found more than half of the companies on the 2009 Fortune 500 list were launched during a recession or bear market. That means it’s likely that even during today’s economic slowdown, some of tomorrow’s biggest employers are just getting their start.

Among the well known companies are; General Electric that commence business in 1890, International Business Machines (IBM) formerly Tabulating Machine Company by Thomas Watson started 1896, General Motors: 1908, Disney brothers Walt and Roy founded their company; Disney Brothers Cartoon Studio in 1923, Burger King: 1953, Microsoft: 1975 by Bill Gates and Paul Allen and in 1980 the media entrepreneur Ted Turner commence CNN: The Cable News Network, the first channel in the United States to provide 24-hour news coverage and numerous other companies that you know.

As I said earlier, we all experience personal recession in our life at one time or the other, the problem is that majority hardly look inward for the benefit it can bring to their life. There is one thing I am sure of, every self made millionaire will sincerely say yes to this notion. I guess by the time you finish reading this article, you might as well appreciate the current economic situation both generally and personally and start taking a good look at it to better your situation.

One concept we can use to support the benefit of recession is the way we act during emergency. Not sure whether one will survive or not, but everyone use both physical and psychological power beyond ordinary during emergency. If only we see recession as emergency situation where no one has the time to blame one another instead try to find a way of survival until it’s over then we will realize how beneficiary this current recession could be.

The causes of economic recession vary in different nation and even personally. While some earn enough but overspent, some are not earning enough to take care of their necessities. Some even go to the extent of relying on debt to take care of their daily needs.

The causes of recession are more glaring in developing more than that of developed nations. While economist has general reasons for recession such as interest rate, stock market crash, etc. My take on the causes of recession in the present situation we have in Nigeria are;

1.     Over dependency on importation:  I look at this as simply as exporting our employment bringing in finished goods which also deplete our foreign reserve. At the same time, it’s developing other countries at the expense of ours.
2.     Corruption: We have taking corruption to become normal norms and anyone against it is seen to be abnormal. Recession creep into our system as a result of people most especially leader converting public resources meant for development to personal resources. Of course such money could not be easily spent freely without been question, as a result they move the money to most especially developed countries. Another scenario that result into developing other countries at the expense of ours.
3.     Politics: An average Nigeria believes the easy way to become rich is to be elected or appointed to public post complementing corruption as discuss above.
4.     Inability to differentiate between schooling and education that is creating mass of employee of labour more than employer of labour.
5.     Putting square peg in a round hole: Appointing people into key economic position is more of politics more than ability.

Having list out some of the causes of the current economic upheaval happen in Nigeria to the best of my knowledge, my concern is about you and how you can take advantage of the benefit of recession to create a brighter future.

1.     Do you really believe “Every cloud has a silver lining?” If you do, then, recession is not an exception. Personally, I have come to realize that, during challenges like recession people are more creative. The reason behind it is simple, in an attempt keep maintaining your current economic status, people think alternative way out.
2.     Recession create opportunity for the local producers. Since one of the major causes of recession is importation, during period of recession importation become tighten with higher price, given local producer to increase the price of their goods too even if there is little or no increment in cost of production.
3.     Recession is a period of alerting people to stop wastage. During economic boom, we waste resources despite the fact that we know it’s bad to do so. Recession set in to correct such act. It is natural.
4.     The true period of wealth redistribution is during recession. After the recession you will not be surprise to see people you assume to be rich are behind while those who are struggling financially before then move up. Just prepare yourself for the better. Wake up for the reality.
5.     We all believe “change is the only constant in life.” Then why do we all resist the change that will lead to boom. Allah (God) says in the Holy Qur’an “For indeed, with hardship [will be] ease.” “Indeed, with hardship [will be] ease.”

I am not disputing as you may not be able to control what happens with the economy, but you can control what happen to you. Decide to focus on the positive and focus on finding a way to better yourself.

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