This being Davos, there were plenty of experts on hand to remind everyone that it didn’t matter, and a few more to reiterate the reasons that the new currency should soon strengthen. “The weakness of the euro is the biggest nonevent of the decade,” argues Willem Buiter, a Cambridge economist and a member of the Bank of England’s monetary-policy committee. Nobel Prize winner Robert Mundell of Columbia University quips that it’s basically a convenience for Europeans who need to think in dollars.

The arguments for why the long-awaited rebound of the euro is just around the corner–really, really–are pretty persuasive. Growth in Europe is picking up, with laggardly Germany finally starting to look healthy just as the turbo-charged U.S. economy may finally be about to slow down. As the U.S. current account deficit edges toward $400 billion this year, the dollar won’t look so attractive and investors will shift to the euro. And as the single-currency market makes U.S.-style financial stratagems easier–the euro beat the dollar as a vehicle for bond financing last year –international money managers will increasingly flock there. The European merger business is booming, in part thanks to the convenience of unified markets. Hey, there could even be a hostile takeover in Germany next week. Economist C. Fred Bergsten, in true Bergstenian fashion, even stuck his neck out and predicted that the fundamental equilibrium level of the euro would be revealed as $1.25. “It’s highly undervalued, even irrationally so,” says Bergsten, who runs the Institute for International Economics in Washington, D.C.

So why does the euro keep falling? David Hale, chief global economist for Zurich Group, thinks he knows. “What’s driving the currency outflow from Europe is the huge amount of foreign direct investment,” he says. “These [central bankers] control short-term money. It’s government policies that control the outflow. Welteke can’t control policies; he can only apologize.” Government policies like high taxes and inflexible labor markets encourage companies to invest abroad–especially in the United States–rather than at home. “In my bank we can see the upturn coming in a way not true a month or two ago,” says Lennart Nilsson, CEO of the National Swedish Pension Fund. “But then we have been disappointed before. There are a lot of structural problems on mainland Europe, especially Germany.”

The European Central Bank’s credibility is another big problem. There are times when a twitch of Alan Greenspan’s eyebrow can convince the markets that the Fed is about to get tough. ECB president Wim Duisenberg, by contrast, must manage a melding of 11 central banks that is only a year old. “The ECB is still building up its reputation,” says Horst Siebert, president of the Kiel Institute of World Economics. Which implies what exchange rate? Never mind. One of Germany’s most eminent economists, Siebert is a little gun-shy after having told a German television interviewer that the euro would fall through the parity barrier –and then seeing his words drive the currency down.

To be “building up a reputation” means you don’t have one yet, as poor Christian Noyer was reminded again and again. The vice president of the ECB had to listen patiently all day as everyone discussed the strengths and shortcomings of his institution. He resolutely sidestepped any mention of an interest-rate hike, and offered only central-banker boilerplate in response to charges of opacity and poor credibility. At the end of an afternoon session on the euro, a quick electronic vote found that less than one quarter of the participants present believed that the euro was as credible as the dollar.

So despite all the rah-rah talk about the great potential for the world’s second most important currency, more than a few people are now hedging their bets. “Last year all of these wise guys sat here and predicted $1.10 to $1.15 [to the euro],” says one French businessman. “Look at what happened. So much for the great minds of Davos.”

So buy euros. Go on–we dare you.