Stock market is notoriously alarmist, wrote Noble Laureate US economist Paul Samuelson famously in 1966, as stock prices had correctly predicted five of the last nine American recessions.
It is alarmist because "the stock market is continuously observing the real economy," says Laura Gonzalez, professor of finance at California State University, Long Beach. "And based on what they see in the real economy, they make predictions," she notes.
But, our stock market is exceptional. What globally renowned economists including Samuelson and Gonzalez argued does not seem to be applicable to our market.
We all are aware of the ailing health of our stock market which has been in sick bed for almost a decade.
But, during this period our economy has performed well. Government data says we have averaged more than 6 percent growth over the last one decade. Conversely, the market has been reeling from the shock of the 2010 crash for almost the whole decade.
Even when the market rests at its lowest ebb in the last fiscal year, our economic growth hit record 8.15 percent.
The consistent growth makes us one of the fastest growing economies in the world.
But, our stock market is in an opposite direction. The shine of our economy has neither been reflected on our stock market, nor could the ailing market overshadow the economic shine.
Things are different in other economies. Stock markets in some of the largest Asian economies, including Japan, China and Singapore, are robust like their economies. Their economies and markets have a correlation, which is completely absent in our case. Therefore, it raises a crucial question: Is our growth data overstated?
However, the finance ministry has recently taken some efforts to improve the health of our stock market which is necessary to make it fit our economic growth.
The ministry offered banks some lucrative incentives, including exemption from provisioning to invest in the market.
Each of the 57 banks can create a special fund worth Tk200 crore for the next five years to expand their exposure to the stock market, subject to several regulations.
They can also use their own funds or borrow from the Bangladesh Bank at 5 percent, instead of the existing 6 percent, for five years through repo or refinancing mechanism against treasury bills and bonds.
Conversely, four more state-run banks will also go public this year, while the currently listed one will offload more shares as per the ministry's decision though the banking sector is still reeling from the shock of defaulted loans to draw money from the market.
Some other measures including doubling tax-free dividend income and raising quota for general investors in case of initial public offering were taken in the last few months.
More than two dozen insurance companies that remain outside of the stock market have been asked by the finance ministry to get listed.
The main objective of all the measures initiated by the finance ministry is clear: boosting the stock market by reducing liquidity crisis and supplying some quality shares.
If the measures work well and make our stock market shinning, the puzzle about it will be solved.
But one thing remains unanswered – why the ministry refrains from making visible the measures for restoring investors' confidence in the market.
Economists, bankers, market analysts have been speaking for improving governance in the market to restore investors' confidence.
The regulator, which is assigned the job of overseeing fair play in the market, has been accused of playing an unfair role by preferring selective actions.
Because of its poor surveillance, investors have alleged for long that some companies manipulated their disclosures with exaggerated information about themselves to float their shares in primary market.
Investors have also questioned the regulator's role in the secondary market. It allegedly has not taken proper actions on time in the past to stop increasing artificial demand and supply.
Those who masterminded the stock market crashes in 1996 and 2010 were not put on the dock. They remain as free birds. The stock market is still suffering from the shock. And it is not free from manipulation, fear investors.
Banks, financial institutions and individuals will not feel secure to pour money into the market if its governance is not improved.
In such a situation, it may not be an easy task to have a healthy market if its governance is not improved.
The efforts taken by the finance ministry have contributed to some positive vibes in the market as indices have been making big gains for the last few days. The index gained another 170 points or 3.71 percent on Sunday.
But none can say for sure that the market will be behaving the same way when investors' confidence in the market remains at low.
Can all the efforts be able to solve the puzzle why one of the fastest growing economies has an ailing stock market?