With house prices rising as well, household wealth has been increasing again, and more rapidly than income. Clearly, geopolitical risks persist, but not to the nearly paralyzing degree seen earlier. As a consequence, aggregate demand has strengthened considerably, aided greatly by stimulative fiscal and monetary policies. Reductions in personal taxes have supported disposable income despite a lagging labor market.
This underlines the relevance of initiatives for containing stability risks resulting from the failure or the collective behaviour of hedge funds. BIS Review 13/2009  3  There are two basic channels for reducing potential macroprudential risks associated with hedge funds if direct regulation is still regarded as an inappropriate measure.