, wage moderation was central to improve the financial health of the private sector. that would lay the foundations for an improved investment climate, supporting labour demand. here, the central bank had little more instruments than to use its weight and try to influence the private sector. the famous wassenaar agreement of 1982, was supported by dnb, because it offered scope for restoring profitability of the business sector. at the end of duisenberg's presidency, some concluded, rather optimistically, that a dutch miracle had replaced the dutch disease. the dutch economy had experienced a successful recovery that can be ascribed to many factors : monetary and budgetary stability, as well as wage moderation and structural changes in labour and product markets. it is safe to say that duisenberg contributed to all of these factors. when one would try to summarize the legacy of duisenberg's dnb presidency, i think the first central theme is his aim for stability. he achieved that stability by a persistent policy and staying the course. frequently, he had to defend this kind of policy line, for example regarding interest rate adjustments in view of the exchange rate. in dutch he described this kind of policy as “ stug ”, translated as stiff or tough. “ stug ” has the subtle connotation that he did not expect much initial cooperation in his policy line towards stability. another central theme for duisenberg was his relentless focus on the benefit of the dutch society. this may sound self - evident for a policymaker, but duisenberg interpreted this differently from a politician. he demonstrated that a central banker should look at the long term costs and benefits. to give an example, at the time when politicians were celebrating the proceeds of natural gas production – 6 % of gdp in 1981 – duisenberg stressed that this was only temporary and warned that painful adjustments would be necessary in the long term. the last central theme that characterizes duisenberg's presidency is his european focus. with respect to economic policy, duisenberg continuously stressed that an “ alleingang ” would be catastrophic for the economic well - being of nations. an integrating world, with all its complexities and risks, required international cooperation and coordination. duisenberg was aware as well, that a single monetary policy would not always match with local developments. his message is that the remaining channels to adapt to country - specific shocks should be safeguarded and strengthened. that is the main reason for his strong support for

a small, open economy, the netherlands could only benefit from international cooperation, free trade and free capital markets. duisenberg advocated the opinion that integration of monetary policy was the inevitable reply to this liberalization of european money and capital markets. returning again to the start of duisenberg's presidency, the high inflation and interest rates in that period had a serious effect on the real estate market. in the early 1980s several mortgage banks ran into trouble. in 1983 one of them, the tilburgsche hypotheekbank, became insolvent. this mortgage bank crisis was a serious test for the new prudential supervision regime of dnb, the wtk of 1978. duisenberg indicated firmly that supervision could only minimize the probability of failures, not exclude them. he showed that this tough policy line could be complemented by careful steering towards a private sector solution. two of the mortgage banks could be rescued by other institutions, which benefited all stakeholders, including the creditors. ultimately, 95 % of the liabilities of the failed tilburgsche hypotheekbank could be paid off. duisenberg took a clear stand with respect to budgetary policy. starting with his first annual report, duisenberg has always maintained that dnb would not support an expansionary budgetary policy that would result in unsustainable deficits. a view like that was not at all obvious in the 1970s and 80s. between the second world war and the 1970s, dutch economic policy had been of a keynesian nature, with scope for activist, counter - cyclical budgetary stimulus. early 1980s, the consensus view changed gradually towards a more restrictive budgetary policy. with patience and perseverance, duisenberg continued to explain the adverse economic consequences of a high budget deficit. his main argument was the upward effect on interest rates, which reduced private investment and economic growth. also, duisenberg had the view that the dutch welfare state could not be supported in the long run if budgetary policy would not change its course. finally, duisenberg argued, international coordination of economic policy required a budgetary situation that is under control and on a sustainable path. in a sense, he gave early arguments for the stability and growth pact, that was signed in 1997. duisenberg's view on economic policy was completed by respecting the crucial role of employers and employees in setting wages and labour costs. next to stable exchange rates, low inflation and low capital market rates