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Here’s a type of attention that has escaped most of the financial world in the last few years: resounding praise. And it’s being directed at practitioners of that dullest of financial professions, central banking.
Mario Draghi, the head of the European Central Bank, is the FT’s person of the year. Draghi gets the nod for standing against an existential threat with almost Churchillian resolve and rhetoric: “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro... And believe me, it will be enough”. The FT calls that July statement a “turning point in the three-year-old crisis” that “in effect dared financial markets to challenge the ECB’s unlimited firepower”. Draghi has necessarily made the job deeply political: Matt Yglesias compared Draghi’s ECB to a “shadow government” enforcing budget cuts.
Draghi’s peers around the world are also receiving lavish plaudits from just about everybody (except, of course, those US politicians with their subtle threats). Zachary Karabel writes that central bankers are not only being forced to repeatedly save the world, “they are tending to the financial system with greater nimbleness, creativity and maturity than their political counterparts or any other societal actor”. The Economist calls this “the grey man’s burden” and says that today’s central bankers are the “most powerful and daring players in the global economy”.
If you’re looking to put a number on central bankers’ value: The Atlantic’s Matthew O’Brien, comparing nominal and potential GDP, found that a team of “superstar” central bankers can be worth a trillion dollars a year. No wonder the UK imported its next central banker. -- Ben Walsh