Spot next crisis
Your ‘body heat’ points to the general financial temperature, says Bernard Otabil
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We surely live in a world full of uncertainties, don’t we? Sure we do! And the irony is that we also live in a world in which many profess to have the antidote to the myriad of problems and, of course, uncertain situations confronting us!
The confusion here is prompted by the question: Are the “experts” real, or just masters at dishing out placebos to a desired effect? Well, we will soon find out!
Of course, the truth that needs no further digging to unearth is that there are mysteries surrounding most things around us. This brings to sharp memory a conversation l had with a friend some few years back on the mysteries of the world.
After we had had a good round of arguments and counter arguments, my friend just let it drop with a teasing smile that “life in general is a mystery because even with the best of intuition and prayer, you can still never tell what will happen tomorrow”.
Perhaps, his summary on the context of the argument was basically to point out the obvious, which is, a life that edges on mystery will throw up uncertainties every now and then. For that, which is marked as uncertain, could come with it a groundswell of crisis.
Okay. My introduction here is only a way to gradually ease it into context the word “crisis”. You may have heard the use of the word several times over as people frequently talk about some form of crisis that they are experiencing or have experienced. Many have experienced crisis before. However, if you haven’t had the opportunity to deal with a crisis before in your life to date, l would say you have been lucky!
Crisis can be basic or severe, when it becomes that complicated. But l must also add that our disposition to crisis and our coping mechanisms would determine the interpretation that we give to the situation.
Basic crisis can be experienced in the family, marriage, finances and even in social relations. And there are massive ones too! As an example, let us use the Ebola crisis. The world experienced the Ebola crisis that wreaked havoc in some countries, draining public purse and stretching the emergency services team in those countries to the limit.
However, the Ebola crisis passed, just as other crisis did, so today we seem not to remember the state of affairs and the trepidation that used to grip us during the days of the crisis.
But we are always reminded, whenever we find an advert on insurance products or insurance companies, that in the uncertain world in which we live today, we can never say that we will never experience crisis again.
We surely will because even where nature has been kind and sleepy to our course, our actions have often triggered natural disasters of serious consequential effects. We have contributed to floods and other forms of geological processes by our actions and yet blame nature or categorise it as “natural disaster”.
Pollution, mostly fuelled by our nurtured industrial exploits of recent years is a case in point. Carbon emissions, generally deemed as a threat to the safety of the planet, is still not combated the way many would want to see it done. The laxity in the approach to addressing the threat of carbon emissions to human life is a testament to our general lack of seriousness in combating threatening situations.
It is for this reason that this week l would like us to be exposed-a bit more- to an aspect of crisis; what crisis is in the financial world so that, with luck, we will be able to spot the next crisis.
To set this off, l would like to use your own personal experience as the base. And for that reason, l would like to pose this question to you: How do you notice that your finances are getting bad?
The truth is, it is not difficult at all to spot your own personal financial crisis, except where you have decided not to heed to any of the warning signs.
Read what a friend wrote to me when l asked him the same question: “Mine is a simple case of making a comparison between how I lived yesterday and how l am living now. Whenever l see a drop in my ability to afford items l could easily pay for some time back, l get the prompting that things are not the same. I would then make the necessary adjustments to, at least, come back to the level l used to be.
In my business, l have always told my secretary that the signal for sales people and for that matter workers to be pushed harder to increase productivity is when we start telling ‘lies’ on phone to our suppliers because we don’t have the cashflow to fulfill an obligation. In effect, it is not hard to spot your bother before you hit that spot!”
This, to me, was an apt description of the personal finance situation. When the school fees cannot be paid easily, utility bills cannot be paid and even food is a problem securing, they are all pointers to a looming financial crisis that needs urgent attention. It is not a rocket science as it is all about the desire to get it right with your finances.
This micro level crisis identification is easier spotting than the macro level effects, control of which you have none. The big picture here is the hardships that could come about as a result of banking, debt, currency, liquidity and, of course, multiple crises.
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The past global financial crisis is a clear case in point. When it came to a boil in 2007, the effect was felt on the Main Street, even though Wall Street had started it all. But before that were the warning signs, as individual households seemingly were over indulging in the credit market. You can spot the next crisis if you a very diligent on happenings around you.