Counterparties: Central bankers are the new rockstars
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Hereâs a type of attention that has escaped most of the financial world in the last few years: resounding praise. And itâs being directed at practitioners of that dullest of financial professions, central banking.
Mario Draghi, the head of the European Central Bank, is the FTâs person of the year. Draghi gets the nod for standing against an existential threat with almost Churchillian resolve and rhetoric: âWithin our mandate, the ECB is ready to do whatever it takes to preserve the euro… And believe me, it will be enoughâ. The FT calls that July statement a âturning point in the three-year-old crisisâ Â that âin effect dared financial markets to challenge the ECBâs unlimited firepowerâ. Draghi has necessarily made the job deeply political: Matt Yglesias compared Draghiâs ECB to a âshadow governmentâ enforcing budget cuts.
Draghiâs 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, âthey are tending to the financial system with greater nimbleness, creativity and maturity than their political counterparts or any other societal actorâ. The Economist calls this âthe grey manâs burdenâ and says that todayâs central bankers are the âmost powerful and daring players in the global economyâ.
If youâre looking to put a number on central bankersâ value: The Atlanticâs Matthew OâBrien, comparing nominal and potential GDP, found that a team of âsuperstarâ central bankers can be worth a trillion dollars a year. No wonder the UK imported its next central banker. — Ben Walsh Â
On to todayâs links: