The Economist (1999, pp 15-16) put the same point more briefly: “Most academics now believe that only radical solutions will work: either currencies must float freely, or they must be tightly tied (through a currency board or, even better, currency union).” The rationale is rather different from the traditional textbook arguments about the choice of exchange rate regime.1 The new argument is a response to the volatility of capital flows and the threat of self-fulfilling speculative attacks: both strong fixes and free floats are immune from attack, at least in a definitional sense.
At the fixed end, the emphasis is on credibility, so irrevocability is an important element of the fix - hence the interest in currency boards and the ultimate fix - dollarisation. At the other end of the spectrum, the pure float also has the attraction of its ability to withstand an attack (or large volatile capital flows) without the exchange rate regime collapsing.