The emerging markets’ cup is full – but is it overflowing? Debt and equity markets tell the same story. The extra risk of the emerging economies had diminished steadily over time for many years and, after spiking briefly in the months after Lehman, it is as low as ever.

This shows up in book value multiples. Emerging market stocks long traded at a discount to the developed world due to the extra perceived risks. Now they trade at a slight premium, presumably due to perceived extra growth prospects. It also shows up in the extra yield the market requires from emerging market bonds compared with US Treasuries, which is now about 2.5 percentage points, according to the JPMorgan EMBI+ index.

There is no mystery about why this has happened. Money is pouring into the emerging world because of the paucity of returns in the developed world. But when equity and debt were last at these relative valuations, in 2008, a bubble burst. Why shouldn’t it burst again?