Specifically, I'd like to speak about volatility in both the real economy and in financial markets and discuss how it has been affected by monetary policy and financial innovation. Of course, there's money to be made from the volatility of financial assets. Hedge funds, like other financial market participants, try to profit from price movements.
Hedge funds are also a source of financial innovation and market liquidity. From the perspective of a central banker, I can say that on balance, at most times, hedge funds make markets more liquid and efficient. And in all likelihood, this has contributed to reducing financial volatility, at least in some important markets.