The cost of emerging-market debt rose sharply yesterday, although it, too, rallied a little by the end of the day.

Salomon Brothers reports that $90 billion of emerging-market debt has been issued through August, 44 percent above last year's pace.

"I think that emerging-market debt is probably going to be rather volatile this year."

Remember the collapse of emerging-market debt in late 1994 and the crash of the Thailand stock market last year?

Turan Corporation, the first company to specialize in Turkish and emerging-market debt.

Remarkably, high-yield bonds of United States companies recently yielded more than emerging-market debt.

The recent sharp selloff in emerging-market debt has acted like a cold shower for some of the new investors.

Another piece of bad luck: these big investors typically hedged against losses in emerging-market debt by selling Treasury securities that they did not own.

The state of the global economy is also favorable to emerging-market debt.

They could find it very expensive, or impossible, to raise money to meet those obligations if investors lose confidence in emerging-market debt.