Daily Finance Newsletter
A silent economic experiment is unfolding in America — one that could reshape the global system for decades. And almost nobody is prepared for it.
Something unprecedented is happening to the US dollar:
It’s down nearly 10% this year — the steepest fall since 1973.
At first, this looked like chaos caused by Trump’s unpredictable policies. But as the months rolled on, a new picture emerged:
This may not be an accident. It may be deliberate.
Trump and his inner circle appear to be testing a radical idea:
Break the dollar’s dominance to revive American manufacturing.
The upside could be political victory and a manufacturing revival.
The downside? A recession, a global crisis — or both.
Let’s break down the full story.
1. How the Dollar Became Too Strong for America’s Own Good
For decades the US dollar has dominated global trade:
50%+ of international trade invoices use the dollar
90% of FX transactions involve the dollar
The world saves in dollars, invests in dollars, settles in dollars
This dominance created a strange loop:
Foreign capital → flows into America → pushes up the dollar → makes imports cheap → crushes US factories.
Between the 1990s and 2000s:
Asian economies grew explosively
They saved trillions
They sent hundreds of billions into the US
The dollar jumped nearly 50%
Consumers loved it: Japanese TVs, Korean appliances, Chinese toys — all suddenly cheap.
But American factories couldn’t compete.
The result:
3 million manufacturing jobs lost
Industrial towns hollowed out
States like Michigan, Ohio, Pennsylvania collapsed economically
Half of income growth went to the top 1%, while the bottom half fell from 20% to just 13% of national income
This economic wound is the foundation of Trump’s political base.
2. Trump’s First Attempt: Tariffs — and Why They Backfired
In 2016, Trump’s plan was straightforward:
Tariffs → Reduce imports → Bring back jobs
But the opposite happened.
The trade war cost the US ~170,000 manufacturing jobs
US firms paid $46B in extra import costs
Foreign capital flowed into the US in fear
The dollar became even stronger
A stronger dollar made US exports less competitive.
The tariffs helped the election narrative, but hurt the manufacturing revival.
That’s when a controversial idea emerged.
3. The Theory That Changed Everything: “We Must Devalue the Dollar”
Economist Scott Besset (later Trump’s Treasury Secretary) argued:
The only way to revive US manufacturing is to weaken the dollar.
But there’s a problem:
Capital controls are illegal under modern trade rules
The dollar is a “safe haven”
Even during American-made crises, money flows into the dollar
Trying to break the dollar’s safe-haven status is like trying to break gravity.
Unless you cause chaos intentionally.
And that seems to be the strategy.
4. The “Mar-a-Lago Accord”: A Blueprint to Break Dollar Dominance
According to reports, Trump’s team discussed a plan privately dubbed:
The Mar-a-Lago Accord
The idea:
Use policy volatility — tariffs, deficits, attacks on the Fed — to make the dollar look unsafe.
Key moves:
Massive deficit spending
Pushes inflation risk → weakens currency
Aggressive tariffs
Creates global uncertainty → scares investors out of the dollar
Public pressure on the Fed
Signals policy unpredictability → undermines confidence
Whether intentional or accidental, the pattern matches the theory.
5. The Market Reaction: Chaos, Panic — and a Tumble in the Dollar
When Trump announced sweeping tariffs:
Dow crashed 8% in a day
Treasury yields spiked
Dollar hit its lowest level in years
Gold demand surged to decade highs
Then, weeks later:
Trump reversed most of the tariffs.
Confusing? Yes.
Random? Maybe not.
If the goal was to shake investor confidence — mission accomplished.
Investors remained nervous, unsure of future policy.
The dollar kept falling:
–12% in weeks
Meanwhile, something surprising happened…
6. The Manufacturing Revival — Is It Working?
With the dollar weaker:
Michigan auto exports: +12%
Texas energy shipments (oil/gas): +15%
Ohio & Pennsylvania machinery/steel: first export uptick in a decade
The places hurt most by globalization are showing early signs of life.
This is exactly what a weaker dollar is supposed to achieve.
7. But the Risks Are Enormous
Pulling money out of the US has consequences:
1. Higher interest rates everywhere
Less global capital → higher borrowing costs
The US has $36 trillion in debt.
Every 1% increase = $360 billion extra interest per year.
Interest payments already consume 15% of the federal budget.
2. Tech could implode
US tech companies are loaded with debt from the zero-rate era.
Most of it used to bet on AI.
If they suddenly face double interest payments, failures could cascade.
3. A recession becomes highly likely
A deflating investment bubble + higher borrowing costs = recession risk.
This is the dark side of the strategy.
8. The Global Stakes: America’s Reserve Currency Privilege at Risk
The US has enjoyed a superpower advantage for decades:
Borrow cheaply
Run deficits safely
Attract global capital effortlessly
Let the world hold your currency
Breaking the dollar’s dominance means:
The world diversifies into euro/yuan/gold
US borrowing costs structurally rise
Deficits become dangerous
Global markets lose their anchor
This is the core gamble.
A weaker dollar may revive US manufacturing.
But it could also shatter the global system built around the dollar since WWII.
Trade The Times View
This is the biggest macro experiment since the end of Bretton Woods.
Trump’s team is either:
executing a calculated strategy to realign the US economy, or
improvising politically with global consequences
Either way, one fact remains:
A deliberate weakening of the dollar is underway — and it will reshape markets, trade, commodities, tech valuations, and global power dynamics.
Investors must prepare for a world where:
Volatility stays high
Gold and commodities stay strong
The US dollar is no longer the unquestioned king
Export-heavy states outperform
Debt-heavy tech firms face a reckoning
Interest rates may remain structurally elevated
This is not a short-term story.
This is the next decade.
Stay ahead of it.