Unable to agree quickly on any other way to soothe gyrating exchange markets, the world's moneymen last March stumbled grudgingly into a different kind of international monetary system. In it, most major currencies are "floating"—that is, selling not at rates fixed in U.S. dollars but at prices set by supply and demand.* Last week that makeshift system was put to its first serious test, and it performed adequately. What could have become a first-class crisis was defused without anybody having to do anything in particular.
The noncrisis began with a run on...
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