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The European Central Bank president Mario Draghi speaks in January, 2012.ALEX DOMANSKI/Reuters

A year ago this week, Mario Draghi put all the rumours to rest.

Speaking in London, the president of the European Central Bank uttered a comment that ultimately calmed an entire continent: "Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough," he said.

Investors liked the message from the get-go. But the true power of those words is best seen when you look back over the past year. Thomson Reuters compiled returns on major financial benchmarks and indices such as Spanish stocks and Italian bonds since the speech, and the figures are pretty stunning.

Some examples: the Euro Stoxx financials index is up 45 per cent; Spanish 10-year government bond prices jumped 30 per cent; the S&P 500 also jumped 30 per cent; and the price of gold has plummeted 19 per cent.

The longer list of returns can be found here.

Clearly Mr. Draghi isn't solely responsible for all of this. The U.S. Federal Reserve is still buying bonds and Japan recently ramped up its own quantitative easing – both of which have distorted global markets.

But there's definitely a message here: investors reward confidence. For three years straight the euro zone dealt with uncertainty, and every time a massive new problem cropped up, Mr. Draghi put an end to it.

In retrospect, it's all very similar to the U.S. bank stress tests that came out in March, 2009. Until then, no one knew whether the U.S. financial system was doomed. But the test results cleared the air, and markets quickly started moving higher.

Mr. Draghi's words couldn't solve every crisis, and Europe clearly still has problems. Greece recently needed more bailout funds and Portuguese yields recently started soaring again. But now the panic is much more subdued, largely because investors know there's a big backstop that's willing to do "whatever it takes."

(Tim Kiladze is a Globe and Mail banking reporter.)

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