Pakistan: After the Crash


By Naween A. Mangi

LOCKED INTO LOSSES. The futures buyers consisted mostly of retail speculators. When the settlement date came, they were unable to pay for delivery because they had counted on selling out beforehand. The 5% lockup kept them from doing so. Dreams and fortunes crumbled, and panic reigned.

Eventually, a consortium of financial institutions bought shares that investors were stuck with, and some calm returned. But the jitters have since continued, and the market has remained volatile, ending Apr. 21 at 7,101, down 31% from the high on Mar. 15.

Soon after, the Securities & Exchange Commission beefed up regulations increasing margin requirements for futures trading, making the collection of loss margins on an hourly, rather than daily, basis and promising to introduce a client identification system in November. The SEC als


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