Fundamentals in Currency Markets

["michael perelman" <michael@xxxxxxxxxxxxxxxxx>]

I am working on a new project concerning economic instability.  I want to
make the point that the foreign exchange markets, especially for currencies
of advanced capitalist markets, should be relatively stable, according to
Milton Friedman and his crew; yet they are terribly unstable in the sense
that they move over extended periods of time with little relationship to
what would seem to be the fundamentals of the currency values. Froot,
Kenneth A. and Richard H. Thaler. 1990. "Foreign Exchange." Journal of
Economic Perspectives, 4: 3 (Summer): pp. 179-92 had a piece along these
lines.  Does anybody know of anything more solid on this subject.
Thanks.
------
Michael Perelman
Economics Department
California State University
Chico, CA 95929
michael@xxxxxxxxxxxxxxxxx
916-898-5321
916-898-5901 fax