Why are markets down? In part, because they have gone up too far too fast and were ripe for a fall. More importantly, it is because central banks have supplied copious amounts of money to the markets at ultra-low interest rates. In recent days, investors have looked at rising bond yields, higher wage growth and dearer commodity prices and started to fret about something that has not concerned them in recent years: inflation. They have woken up to the possibility that the Fed might get more aggressive in removing the stimulus provided since the collapse of Lehman Brothers in September 2008.

A dose of reality is no bad thing. Memories of the financial crisis have faded. During 2017, stock market volatility was low, investors started to take bigger and bigger bets on borrowed money and speculators discovered a new financial instrument in the form of bitcoin. All these were signs of a reckless over-confidence.

James Bateman of Fidelity International said the stock market correction was a good thing. “The tech-fuelled rally in the US had long lost any sense of reality in its valuations, the prospect of inflation remaining low forever could not last, and we have a new and untested Fed chair,” he said. “It would be more worrying if markets didn’t react to all of this.”