It was fitting that I should present our latest assessment of global financial stability in Sao Paulo, the financial center of one of the leading emerging economies. In common with many of its peers in Latin America, Brazil is recovering strongly from the crisis. But new financial stability challenges are emerging in this, and other fast-growing regions. I have three key messages: Financial risks have increased since April Policymakers in both advanced and emerging economies need to step up their efforts to preserve financial stability and safeguard the recovery. We have entered into a new phase of the crisis - a political phase- when tough political decisions will need to be made. Time is of the essence.