Irving Fisher's debt deflation theory argues that the interaction of excessive debt and deflation (falling prices) is a major cause of economic depressions.
When an economy has accumulated too much debt and prices start falling, a destructive cycle begins:
Rising real debt burden (deflation increases the real value of debt), distress selling (debtors sell assets cheaply to pay debts), further price declines (increased supply from distress sales drives prices lower), and falling profits and employment.
The paradox is that attempts to reduce debt actually worsen deflation, which increases the real debt burden further.
While Bangladesh hasn't experienced widespread deflation, the high levels of non-performing loans and risks of asset bubbles bursting make Fisher's theory relevant.