THE STORY SO FAR: Until 1971, the dollar had for years lived a sheltered life in a world where currency exchange rates were all fixed by government policy. Then everyone agreed that the dollar had gotten lazy and dreadfully overvalued.Everyone said that the dollar needed to get out and move around more. That was when its adventures began - and they shortly got a bit more exciting than anyone had originally intended. By 1973, most governments had abandoned the old tradition of fixed rates and were letting their currencies float. That means letting the world's money market set currency values in the course of daily buying and selling. Sometimes the dollar floated up a little, and sometimes it floated down.

That brings us to today's episode in the story, Installment Umpteen, entitled. The Smoothing Operation. Because the United States has been running a very large trade deficit, more dollars have been piling up abroad than anyone immediately needs. Following the rules of supply and demand, the price of the dollar, against several other currencies, began to fall some months ago. Scenting a further drop, money traders began speculating on it. That, in turn, made the dollar drop faster.

To the Europeans and Japanese, one of the exasperating things about Americans is that they don't seem to care much about the adventures of the dollar. In the other major trading nations, people follow the exchange rates with vast anxiety. They find it irksome that most Americans pay no attention at all. In answers to foreign complaints about this easy disregard of the dollar's latest decline, President Carter made a carefully limited promise. He told the rest of the world that the United States would not permit speculation to disrupt the market. Last week the U.S. government began buying dollars on the exchange markets, as the price bounced back up a bit.

This kind of intervantion has two purposes. It provides a shock absorber, smoothing out the sudden swings and jolts in a volatile market. That prevents drastic changes in exchange rates that would interfere with orderly international trade. The second purpose is, of course, to make currency speculation a little more dangerous to the speculators and prevent their predictions from becoming self-fulfilling.

Whenever the international monetary system comes up, a good many readers doubtless ask themselves whether it is really worth trying to follow such a technical and unfriendly subject. Can it not be safely left to the experts? We'd say that it is very much like the water system that serves your home. It's not one of the things you have to worry about every day. But yoy'd better not forget what a serious breakdown would mean; it would be a emergency of the most desperate sort. It's necessary to add that, in this century, monetary systems have broken down more often than water systems.

The Carter administration over the past two weeks has been working to reassure the world that the United States is not deliberately pushing down the value of the dollar to get a competitive advantage. If foreign government began to believe other wise, the result would be chaos. Some governments would try to devalue faster, to say ahead of the Americans. OPEC would certainly raise its oil prices, which are set in dollars.

The administration is doing the right thing and, really, the only thing that it can resonably do.It is certainly not promosing to hold the dollar at a fixed value. That would be a foolish promise, and a futile one.But is trying to guarantee that the dollar will move onlt slowly, and only to reflect real changes in the economy.