Magazine article Newsweek International

Central Banker: Mark Carney

Magazine article Newsweek International

Central Banker: Mark Carney

Article excerpt

Byline: Daniel Gross

A Canadian takes the helm at the Bank of England.

As a goalie on Harvard's hockey team in the 1980s, Mark Carney had a perfect record. He played for 5 minutes and 54 seconds in a single varsity game, made five saves, and allowed no goals. Carney was closing out a 10-2 rout of Colgate, which means he had excellent timing as well as skill.

Twenty-five years later, Carney--a native of Canada who has run the country's central bank since early 2008--is entering much more slippery territory. In late November he was tapped to take over one of the most difficult roles in global central banking: governor of the Bank of England.

A major reason he got the nod is that while Canada's economy shrank 2.77 percent in 2009, it avoided a banking crisis and the politically damaging bailouts that ravaged the United States and the United Kingdom. And in recent years, as developed countries have struggled with slow growth and double-dip recessions, Canada's economy has posted a central banker's hat trick: steady growth, low inflation, and a strong currency.

Yet as was the case in that game against Colgate, Carney's success had a lot to do with timing. "Canada was free of crisis, but it wasn't Carney that did it," said Michael D. Bordo, professor of economics at Rutgers University. "It's a much more deep-seated story having to do with the financial system's design."

Canada has a concentrated national banking system in which a handful of institutions, supervised by a strong regulator, dominate deposits, home lending, and stock trading. …

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