If Trump plays hardball with the Chinese, Japanese and others over their currency manipulations, then that implies the value of those currencies must rise vis a vis the U.S. Dollar.
This is, in effect, a dollar devaluation—really good for U.S. manufacturing and other exports, because it makes our prices more competitive around the world as well as here at home.
Of course, the price of stuff made other places will rise . . . but, if all goes as planned, the manufacturing capacity will rapidly build up again in America to replace that supply, and of course Americans will have a far stronger economy. A little pain for a lot of gain.
BUT HERE’S THE POINT: A dollar devaluation also means that all debts can be paid off with cheaper dollars.
THIS IS NOT A DEFAULT . . . but it has some of the same effect. I think this is the strategy behind Trump’s claim the national debt can be paid down in a reasonable number of years.
IT IS REALLY THE ONLY WAY THAT MAKES SENSE FOR AMERICA!!!
How is offering to pay back a debt with anything less than the full amount not a default?
Regards,