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Chief of European Central Bank
Taking Tips From Greenspan

By Mike Corder  Associated Press
AMSTERDAM, Netherlands — Wim Duisenberg understands the power of words. One offhand remark can send stocks soaring or make financial markets tremble.


Ralph Orlowski/Reuters
Duisenberg's new nickname these days is 'Europe's Greenspan'
So when the new president of the European Central Bank was looking for tips of the trade, he went straight to the man who knows it best: Federal Reserve Chairman Alan Greenspan.

"I have to be extremely careful and guarded in my use of language," Duisenberg said in a recent interview. "Greenspan understands that like nobody else. I can learn a lot from him. I've already spoken to him about it."

The Dutch call him "Wim II," Prime Minister Wim Kok being Wim I. But Duisenberg has a new nickname these days — "Europe's Greenspan."

On Jan. 1, with the historic launch of the European Union's common currency, the lanky Dutchman with the shock of white hair arguably will become the world's second most powerful central banker after Greenspan himself.

Although the euro debuts on paper at the first of the year, euro coins and notes won't go into circulation in the 11 participating nations until Jan. 1, 2002. As chief of the powerful European Central Bank, it is Duisenberg's job to preside over the transition.

Despite the comparison with Greenspan, analysts say only time will tell whether Duisenberg — a former Dutch finance minister and ex-head of the Netherlands' central bank — will have the same power and influence to move global financial markets.

"We base our U.S. interest rate predictions totally on Greenspan's words," Ellen van der Gullik of the merchant bank J.P. Morgan told the Dutch newspaper De Volkskrant. "But for the euro zone we don't listen exclusively to Duisenberg."

Although Duisenberg is the European Central Bank's president, he has only one vote on its board of 17, which is made up of representatives of the 11 nations taking part in the monetary union and six directors.

But the chain-smoking golf lover with the decidedly low profile remains a potent figurehead, bearing overall responsibility for price stability in the vast euro zone and overseeing monetary policy.

His bank flexed its muscle for the first time Dec. 3, when all 11 euro countries except Italy cut their base interest rates to 3 percent in a move that took financial markets by surprise.

Duisenberg, in a carefully chosen reaction that Greenspan would have been proud of, described the rate cut as "rather sensational."

A member of the center-left Dutch Labor Party, Duisenberg rose to prominence first as finance minister in the 1970s and later as president of the Dutch Central Bank. His 16-year reign there is widely credited with helping turn the Dutch guilder into one of Europe's strongest currencies, ushering in a period of price stability and pushing down interest rates.

Despite his impressive track record and the backing of most EU leaders, Duisenberg's path to the 35th floor of the European Central Bank headquarters in Frankfurt, Germany, was far from untroubled.

After serving as president of the bank's forerunner, the European Monetary Institute, he was widely expected to become the ECB's first leader. Then France proposed a rival candidate: its central banker, Jean-Claude Trichet, ironically a good friend of Duisenberg's.

Although Duisenberg, 63, eventually was elected for a full eight-year term, the quarrel marred a moment of European history.

Immediately after his appointment, it was announced that Duisenberg would step down after four years under a "gentleman's agreement" brokered to end the rancorous row over who should get the job.

Duisenberg since has stated that no such agreement exists. And he is adamant that a four-year appointment violates the Maastricht Treaty, the 1992 blueprint for monetary union that calls for an independent central bank.

Controversy aside, he'll always have Paris — in September, France inducted him into the coveted Legion of Honor, its highest tribute.

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