Opinion | Mirage of wealth
Summary
The Nepal Stock Exchange index remains high in 2025 driven by massive liquidity and digital access, but this masks a structural fragility with risks of a market bubble and wealth loss for middle-class investors.
Key Points
- Nepal Stock Exchange index floats above 2,600 with market capitalization in trillions, driven by over 6.3 million online trading accounts.
- Market gains are disconnected from corporate earnings and economic productivity, fueled by excess liquidity rather than healthy capital formation.
- Banking sector faces rising non-performing loans while stock valuations are buoyed by cash, posing systemic risks (Minsky Moment).
- Securities Board of Nepal is criticized for regulatory capture and failing to protect investors amidst information asymmetry and market manipulation.
