Another crisis in the offing

Those that lost hearth and home following the infamous financial meltdown ten years ago have barely been able to get their feet under the table battling through numerous jobs and paying off colossal individual debt. There's resentment that governments, barring Australia didn't provide any financial help to the affected but bailed out the institutions responsible. In speaking to The Independent, London former British Prime Minister Gordon Brown believes the world is heading for another crash simply because lessons haven't been learned, responsibility not assigned and punishment not meted out.

While it brought down a giant of a company in Lehman Brothers, the 40,000 odd employees and more importantly the key players didn't vanish into thin air - no they were absorbed in the same financial system that caused much of the fuss in the first place. Mr. Brown believes it is the absence of fines, confiscation of bonuses and periodic bars from continuing their practice that have given rise to seek windfall gains, albeit in newer packaging. Governments were just more concerned as plugging the gaps of a system that was falling apart than apportioning blame. True, there have been fines to some institutions and loss of face for others but those that were hit hard - the general public - had to soldier on.

Bangladesh was able to ward off the impact largely due to not being integrated into the world economy but it had its fair share of innocent sufferers. Two share scams that left people on the streets have never been properly probed leading to all accused in one case being acquitted for prosecution weaknesses. And yet the individuals took heart from assurances by the government only to fall for a second ruse whereby again, profit takers from overseas pulled funds out leading to a resounding crash. Very little if anything was done to provide any succour to the affected and this year the fiscal incentive of tax relief if gains are reinvested in the stock market is rather stale. Fundamentals being sound, the returns are just not viable propositions in the secondary market and initial public offerings (IPOs) are few and far between. It's the gambling that attracts, played dangerously by some with no considerations for fundamentals. The government's efforts to scale down interest rates on bonds and encourage stock investments and bank deposits isn't working either. Badly eroded consumer confidence has led to significant frustration with neither of these options returning gains slightly more than inflation. That that remains low in the single digits is the savings grace.

With written-off bad debt climbing to Tk 1,300 billion (130,000 crore), no progress in recovering the Bangladesh Bank forex heist and continuous reminders of capital flight, it's inevitable that a crash is on the horizon.

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