In our days at St. Gregory's college back in the days, my bosom friend Olayiwola was a chap you'd describe not only as a nerd. By all descriptions of him, Laxi as he was fondly called possessed charm, brilliance and a sense of mathematical excellence in their graceful overabundance.
Laxi was very instinctive, sharp and easy going. His swift aptitude for logic and calculation would make you describe him as one with a perfect mind of Albert Einstein.
His extraordinary performance at school was never meant to be a surprise.
While he was doing the rounds on calculus and the almighty add maths, many other students were busy on the pitch ‘footballing' and ‘basketballing'.
Laxi's proficiency at mathematics later earned him his nick, ‘Baba Maths'.
While students like me were struggling with the basics of arithmetic, laxi had long gone. He was number one in an international maths competition where he contested with the most brilliant University students from around the world.
When challenged by other classmates on one very memorable morning at school, laxi precisely predicted a rainfall in the next week including the centimetre and the rain pattern. When his mathematical prediction came to pass, many students and teachers said he must have heard about the rainfall from the weather forecast. The principal was even heard saying laxi was an idiot.
By then, Laxi had earned many names like idiot, baba maths and the rain man. Oftentimes, he was laughed at, bullied and mocked by teachers and colleagues. For me, Laxi was my god of mathematics. Being my bosom friend for many years, I had seen on many occasions where he used his knowledge of mathematics to do many extraordinary things that our best mathematics teachers would never do.
To cut the story short, graduating from St. Gregory's terminated our long-time friendship, one which I would miss of a true friend and a Great Economist in the make.
About a decade and some years later, on one very hazy and unfriendly British morning, a pleasant surprise emerged. My long lost laxi was found again. As a graduate of mathematical economics from LSE, applied mathematics from Harvard and financial economics from Cambridge, Laxi is now a guy you would call a full grown ‘genie mathematique'.
On one clement weekend, laxi and I decided to escape to the remotest part of the British Isles where we could catch up with misses and gists of the past decade.
There, we relaxed, discussed life, politics, mathematics, business, academia, global economy and Nigeria.
During our escape, one of our most fascinating gists was Nigeria. We discussed the resource cause, bad leadership, the sad state of Nigerian education, the emerging influence of social networks and web forums like the Nigerian Village Square, Sahara reporters and their influence on the body politic.
After discussing and catching up on several issues, I thought it was important to confirm the mathematical prowess of my decade lost god of maths. So I asked if Laxi would be interested in helping to explore some disturbing socio-economic problems with his mathematical power.
After getting his "Yes".
Just like an apprentice in the sorcerer's workshop, I posed several questions and hypothesis on several issues.
"What's the probability of a double dip recession?"
"Will oil prices fall?"
"Will stock fall?"
"What's the likelihood of famine in Sub Saharan Africa and Nigeria in particular?"
"What future economic and political risks face Nigeria?"
"Where could most of the current crises in Nigeria lead?"
While most of these questions are out of my curiosity in testing the potency of my mathematical god, I was also interested in seeking out empirical truth about them.
Some of these questions - I know have given policy makers and folks like me terrible nightmares in the past years and are still threatening, given business and investment concerns. Thus, having well informed knowledge about them would helpful in making informed future economic decisions.
As anyone may think, I was under no stupid illusion as I know, have heard and have seen some of the most stupid and baseless predictions and analyses even from the most informed analysts from around the world.
But who can stop me, I had to test the power of my god. Moreover, this guy could be damn right like in our secondary school days. And who knows? His analyses could offer some positive insights.
When some of my hypotheses were posed to Baba maths, his answer was rather too simplistic. He replied: "to determine the answer simply look at any current event, identify the three most likely future scenarios, assign a probability to each scenario. Analysing over 2-5 years period is always better, then finally identify likely changes.
But I wanted more, so I demanded for a rather complex method of analysing my hypothesized statements.
With my little knowledge of empirical methodologies, I know that the more rigorous a method, the more complex it is likely to be and the more complex the method, the richer the outcome would be.
As a genius, laxi had them all but it was Sunday morning in which we had only few hours to leave. So we agreed to continue via regular communication. I also promised to work on gathering the useful data which would help his analysis.
No sooner than the weekend was over that I realized my superior interest was in money making than in some godforsaken analysis that will lead nowhere. "As an entrepreneur money making should be my number one priority". So I Soliloquised.
For a long time, my curiosity during our holiday weekend with laxi had nearly died but he kept pushing it. After so much was said and done, I explored available databases, pulled out some useful information, numbers and data as directed.
I supplied it all to laxi who confirmed most of my data sources and added many which he was able to gather. After confirming the validity of all data and their sources, he embarked on what he knows to do best, the mathematical analysis.
Having inundated him with too many hypotheses at first, we trimmed it down to the nearest two on Nigeria and one on the global economy.
On the global economy laxi tested the hypothesis of a possible double dip recession.
Based on the data available, he finds the mathematical probability of a double dip recession to be at 69%. This high probability he says is justified by the declining GDP of the United States, excessive pressure on the eurozone and its peripherals', problems with Japan and growing challenges in emerging markets like India and China.
While the quantitative easing (QE) of $400bn rolled out by president Obama few days ago could help. The problem he finds is that the fed and other policy makers around the world would soon run out of feasible policy options in case there are further slumps which would most likely happen in the coming months. Besides, quantitative easing has it glooms.
While Britain and the eurozone might also likely use QE or its equivalent in the coming weeks, laxi finds that this instrument may indeed work but only in the shortest term as the option would likely destabilize productivity, increase inflation and de-incentivise work in the medium term and might back fire within another 18 months.
Although many economists and policy makers would prefer inflation if QE would prevent recession, one major problem with QE according to laxi is that in most historical cases, it hardly addresses the real effects of a financial crisis. Moreover, it only addresses the symptoms and not the cause.
As laxi finds, there is high probability that the greatest cause of a coming recession would not be the United States but the eurozone because of the possible default of Greece and another possible problems likely coming from other eurozone peripherals and increasing pressure from Italy and Spain.
Since a lender of last resort would be needed to cushion possible effects of financial crisis on Spain as well as Italy. Chances of recession could be high because Germany "the saviour" is in deficit, therefore none of the options, either a German rescue, joint Eurobond by member states, European financial facility, or an unlimited liquidity by the ECB would be workable at least politically.
While I consider Laxi's analysis brilliant and straight to the point, I still have so much doubt about the possibility of a double deep recession, so when Paul Zoellick, the World Bank president said last week that the "global economy is unlikely to fall back into recession" I had more reason to disbelieve laxi.
I argued it out but laxi says we should watch as events unfold.
After Zoellick's statement and Laxi's analysis, there have been further declines in the market. As I write, the dow jones industrial average has headed for a loss of about 3.5% with India, Brazil, Japan and few European countries having their own share of market declines.
The stock market plays a significant role in real economy and sentiments. Households with incomes well above average and big firms have their total worth tied to stock prices. The stock market movement therefore determines their investment decisions. The stock market is therefore a realistic way of checking the health of the economy.
The recent declines lead me sometimes to hang on to the analysis and prediction of laxi but in the last few days, few improvements in the market have also rekindled my thoughts that things would get right.
To give myself more positive confidence and to have a clearer picture of where we might be heading in the coming months, I have explored the news critically, the market and every possible indicators. Of all this, there is one important lesson I find which is that the world is in a "danger zone".
If the world in is a danger zone, that means that the "bomb can explode at any time, any moment and any day".
If and when the bomb explodes in the global economy, one wonders what would be the fate of Nigeria and Nigerians in the coming months. Without a global problem, Nigeria is already beset with too many problems and challenges; unemployment, poverty, boko haram, etc.
One wonders if truly there is double dip recession, how Nigerian politicians and policy makers would handle it.
Most likely, if there is a recession with longer and deeper effect, the prices of oil would fall significantly and possibly greater than what we saw in the run up to the 2008 financial crisis. If such happens, how would Nigeria fare?
How will Nigeria pay billions of salaries, arrears and make contract payments?
As Laxi and many prominent economists have predicted, the question is not whether there would be double dip recession but whether it would be mild or severe.
Wherever the pendulum swings, I hope our politicians will for one moment wear their thinking caps, learn from their mistakes and do something to cushion every possible effects of any potential crisis.
As laxi concludes, if the recession is severe it may be longer than predicted and if that happens, developing economies like Nigeria will bear the brutal brunt.
I wonder what will happen.
I wonder what will be the fate of the poor and the unemployed.
Laxi maybe wrong, but let's assume there will be a severe crisis around the corner.
What would be the fate of millions of children, youths and the unemployed?
Whatever it would be, let time be the judge.