of international businesses to build markets and production networks that are truly global in scope, then the current monetary system is in many ways an endless headache whose costs are rapidly outstripping its benefits." She continues with a view on how that monetary system stability is appealing to many players in the world economy, but is being undermined by volatility and fluctuation in exchange rates: "Money scrambles around the globe in quest of the banker's holy grail – sound money of stable value – while undermining every attempt by cash-strapped governments to provide the very stability the wealthy crave." Frank then corroborates Tobin's comments on the problems this instability can create (e.g. high interest rates) for developing countries such as Mexico (1994), countries in South East Asia (1997), and Russia (1998). She writes, "Governments of developing countries try to peg their currencies, only to have the peg undone by capital flight. They offer to dollarize or euroize, only to find themselves so short of dollars that they are forced to cut off growth. They raise interest rates to extraordinary levels to protect investors against currency losses, only to topple their economies and the source of investor profits. ... IMF bailouts provide a brief respite for international investors but they are, even from the perspective of the wealthy, a short-term solution at best ... they leave countries with more debt and fewer options." Effect on volatility One of the main economic hypotheses raised in favor of financial transaction taxes is that such taxes reduce return volatility, leading to an increase of long-term investor utility or more predictable levels of exchange rates. The impact of such a tax on volatility is of particular concern because the main justification given for this tax by Tobin was to improve the autonomy of macroeconomic policy by curbing international currency speculation and its destabilizing effect on national exchange rates. Theoretical models Most studies of the likely impact of the Tobin tax on financial markets volatility have been theoretical—researches conducted laboratory simulations or constructed economic models. Some of these theoretical studies have concluded that a transaction tax could reduce volatility by crowding out speculators or eliminating individual 'noise traders' but that it 'would not have any impact on volatility in case of sufficiently deep global markets such as those in major currency pairs, unlike in case of less liquid markets, such as those in stocks and (especially)