Former Treasury secretary Bob Rubin places a full glass of water on the plump cushion of his Citigroup club chair with all the quiet confidence of a man in the habit of command. He never once looks down, but then, he doesn't have to. He knows the glass won't tip.
For the first few months of last year, traders were obsessing over the seismic disaster that might ensue if -- when -- Bob Rubin decided to leave Treasury. Morgan Stanley perma-bear Barton Biggs went so far as to predict a 700-point drop in the Dow. But when Rubin announced his retirement in a Rose Garden ceremony last May, the Dow dropped a mere 200 points and quickly bounced back, a tribute to the incredible stamina of the bull market that he -- the dollar-defending, global-crisis-averting "best Treasury secretary since Alexander Hamilton" -- had helped create.
Meanwhile, Rubin's own stock was going through the roof. American International Group wanted to hire him. So, too, did Warburg Pincus, Forstmann Little, and Goldman Sachs, the firm where he'd ended his 26-year career as co-CEO when he left for Washington.
But then Rubin unveiled his October surprise: He'd decided to accept the post of executive-committee chairman at the $185 billion financial supermarket Citigroup, forming a triumvirate with Sandy Weill and John Reed. This time, it wasn't the Dow that dropped but Wall Street jaws. The financial community now has a better understanding of what motivates Bob Rubin: He likes a challenge.
Many have speculated that Rubin, whose office is in between Weill's and Reed's, was hired to keep the peace between the two men, said to be butting heads since Traveler's merged with Citibank in 1998. This would make him perhaps the highest-paid couples counselor in history, but there's no truth to it, says Rubin, who describes the situation thus: "I think they actually have very good chemistry as far as I can see, but there are a lot of significant strategic, managerial, and operational issues, and I work with them on those." The troops, meanwhile, were ecstatic to have a third leader: As he turned to leave the trading floor on his first day of work, traders spontaneously applauded. But Rubin hardly feels like a celebrity, he says: "I come in in the morning, and there are all sorts of issues here to deal with. Nobody cares whether I was secretary of the Treasury or anything else. People care about what I say and whether it's of any use in trying to work through these issues."
Living Dangerously His D.C. stint seems almost altruistic when you consider Rubin missed out on Goldman Sachs's IPO windfall last spring. But Rubin doesn't see it that way. "I've been away seven years now," he says, laughing. "It's just not something I think about."
Rubin was one of the few Clinton-administration officials unblemished by scandal. But less than a month after Rubin joined Citigroup, Ralph Nader and a coalition of public-interest groups petitioned the Office of Government Ethics to investigate him, arguing that he may have improperly discussed the new financial-services bill (of which Citigroup is a key beneficiary) with Treasury successor Lawrence Summers after his departure. Government Ethics declined to investigate, as did the inspector general at Treasury. "I think it probably came off a misstatement that appeared in a news report," says Rubin of the flap. "It just wasn't true."
Moneymaking Mantra "An institution is ultimately its people, and one of Clinton's great insights that he's never gotten credit for is to get very good people and find processes for them to work together on. That's why he set up the National Economic Council."
Temperature-Taking The consensus view is that the economy will thrive in 2000, "but there are no guarantees," Rubin cautions. Risks include a labor market that is tight, a savings rate that is low, a stock market that is high "at least by conventional standards," and the possibility of some unforeseen event rocking the rest of the world. As for inflation, which former colleague Alan Greenspan has worked so hard to keep in check, "the fundamental sense that inflation is low I think is correct," says Rubin.
Where He's Headed In 2000 "Patagonia in March, for fly-fishing." Speculation that he would be ordained head of the Fed when Greenspan's term expired in June was quashed when Greenspan renewed his contract two weeks ago. Anyway, he's comfortable as a reinstated New Yorker, confiding now that he thinks Hillary would shine as senator: "I haven't had the occasion to say it publicly, but I think she's smart. I think she's thoughtful. I think she cares a lot about issues that are important. And I think the one thing people have missed is that she is a real fighter for things she gets involved in."
Rubin's less enthralled with the notion of returning to Washington anytime soon. Unlike former Goldman confrère Jon Corzine, he says he has zero interest in running for public office: "I've got a job right now," he says, laughing, "that I feel sort of fully engaged in."