Present the case for floating exchange rates.

Answer:

• Monetary policy autonomy

Governments would be able to use monetary policy to reach internal and external balance. No country would be forced to import inflation and deflation from abroad.

• Symmetry

The United States would no longer be able to set world monetary conditions all by itself. The United States would have the same opportunity as other countries to influence its exchange rate against foreign currencies.

• Exchange rates as automatic

The long and agonizing periods of speculation preceding exchange rate realignments would not occur under floating.