It turns out that a season of unexpectedly high earnings that defied Covid-19’s effective takeover of the world economy has pushed the Pakistan Stock Exchange (PSX) to the number-one position in Asia and fourth in the world in terms of performance. Pakistan has, of course, been able to handle the pandemic better than almost all other countries in the world and it is little surprise that the upbeat sentiment is expressed in the equity market as well. It is also no surprise, considering the overall trend, that foreign investors who were net sellers for most of the past couple of years turned into net buyers in August 2020. This is the undeniable nod of approval from Big Money, mostly investment banks and high net worth individuals, for Pakistan’s reforms program and how proactive fiscal and monetary policies have been able to guide a fragile economy through the worst of the pandemic and the lockdown. But let’s not forget that Pakistan’s is not the only stock market that is setting enviable trends. Markets in much of the west, especially the United States, have surprisingly decoupled from the real economy and have been rising and setting records even as the global economy has slipped into what seems like a very steep recession. The reason is all the stimulus packages and orders of quantitative easing, or simply printing more money to meet emerging needs, that are periodically announced from capitals in North America and Western Europe. Businesses and investors are now convinced that governments will do whatever is necessary to keep capital markets from going dry, even if it means running the printing presses overtime regardless of the effect such things might have on inflation, etc. But Pakistan’s story has been somewhat different in that the stock market is a reflection of the real economy and not divorced from it. Also, welcome as the news of becoming number-one in Asia and four in the world is, let us not forget that we have been here before. The last time we were the best in the region was in 2016, but then the following year our market also became the worst performing in the world. So, while we are doing good, it’s not as if all our troubles are over because our equity market is attracting more investors than any other place on the continent. The government must therefore be congratulated for this success but also cautioned against taking its eye off the ball. *