An equity dealer recently told this paper that while there was a lot of political risk in the world, there was no need to worry. The risk, he said, was “priced in”.

My first thought on reading this was: how does he know that? Indeed, how would anybody know that? The importance of the question lies in what my colleague Martin Wolf has termed the “Davos dilemma” – the contrast between today’s benign global economics and malign global politics. More precisely, we are dealing with a subset of that dilemma: the contrast between soaring equity markets and multiplying risks in the wider world.