Comment by bboygravity
Comment by bboygravity 2 days ago
It's also terrible/impossible news from a USD perspective if the US produces things nationally in a significant way (importing less, selling less printed USD in exchange for goods).
Printing insane amounts of USD to allow for systemic government over-spending and huge untenable government debt doesn't go hand in hand with not importing most goods. You can't keep your currency strong if you can't force others to buy your currency.
If you have a lot of production in the US, this is going to cause hyperinflation to come sooner.
In the long term it won't matter, the end result is the same, but if production significantly moves back to the US it will be very scary from a currency perspective.
I don't see the argument here. Importing less leads to selling less USD (yes), somehow leading to devaluation of USD? Is the implication that the dollar is strong because the US government "forces others" (foreign manufacturers) to buy it? Isn't that the opposite of the first thought, which implied that "selling less printed USD" was the reason that domestic manufacturing would be inflationary? I don't understand the causality, and it doesn't match my mental model ("a country that can build things domestically at a competitive price point should be deflationary because now there is more supply of stuff and equal supply of money"), so I think this could do with some expanding.