Wim Duisenberg understands the
power of words. One offhand remark can send stocks soaring or make
financial markets tremble.
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.
|Duisenberg's new nickname these days is 'Europe's 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
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
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
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
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
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
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
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