American Economy Under COLLAPSE! The Great Plan to Reset the US Dollar is Failing!

Описание: The U.S. government wants a cheaper dollar, but it’s bumping into a hard truth: you can’t simply force a currency to obey. Recent DOJ subpoenas to the Fed and Jerome Powell’s acknowledgement of an investigation tied to the Fed’s HQ renovation have turned what was an institutional relationship into an open power struggle. That matters because America’s economic playbook for decades has depended on one fragile arrangement: Washington spends, the Fed manages the fallout, and global capital keeps showing up. When those incentives split, everything gets harder.

Why U.S. factories can’t rebound
A strong dollar is quietly strangling the industrial comeback politicians keep promising. This isn’t ideology — it’s arithmetic. Over decades the U.S. outsourced production while becoming the world’s largest capital market. That trade-off only works while the dollar doesn’t price U.S. goods like luxury items abroad. Historical data shows industrial output improves when the dollar weakens and stalls when the dollar strengthens. Tariffs reshuffle trade flows but don’t fix competitiveness when a strong currency makes exports expensive. To genuinely re-industrialize you need the currency and central bank aligned with that goal.

Can the Fed weaken the dollar?
A strong dollar is mostly a function of higher returns in U.S. assets. The Fed’s policy rate has been higher than many peers, so global investors have parked money in dollars. If the administration wants a weaker dollar, it essentially wants lower U.S. rates relative to others. But rates aren’t a dial you spin to match political preferences. The U.S. economy’s relative strength pulls capital in, which supports the dollar and allows higher yields. That creates a policy trap: wanting both continued outperformance and a weaker currency is contradictory. If the Fed cuts deeply to satisfy political aims while fundamentals still favor the U.S., markets will reprice risk rather than comply.

Is the dollar already weakening?
The usual dollar index can remain steady even while the dollar’s purchasing power erodes in a different way — against real assets. Since the Fed began cutting in early 2024, stocks, gold, and Bitcoin have surged dramatically. Those moves signal that markets expect looser policy or diminished credibility, and they’re reallocating into scarce and productive assets. This is crucial: trying to engineer a cheaper dollar externally without accepting a weaker dollar internally is impossible. Rate-driven depreciation doesn’t spare savers — it pushes capital into gold, real assets, and alternatives first. So credibility, not just FX cross-rates, becomes the release valve.

What shifts across markets next?
If political pressure pushes monetary policy to favor a weaker dollar, markets won’t passively accept a tidy outcome. Investors will front-run, hedge, and demand higher compensation for uncertainty. The old equilibrium — Washington, the Fed, and global investors all benefiting from the same setup — starts to fray. You’ll see rising risk premia, higher hedging costs, and faster capital rotations. The dollar index may look stable even as investors treat the dollar as deteriorating, using gold, crypto, and equities to express that view. Falling policy rates won’t translate to calm markets if they’re perceived as coerced rather than warranted.

Practical takeaway
Watch incentives, not speeches. The U.S. model of importing goods while exporting financial assets only works when global capital trusts the rules. If Fed independence becomes a bargaining chip, that trust becomes conditional. The real damage isn’t an overnight FX reset — it’s a gradual re-pricing of credibility that shows up as higher costs across markets and erosion of purchasing power in real terms. The biggest winners will be those who read incentives early and position for rising real-asset demand and wider risk premia. The plan to “guide” the dollar becomes a messy negotiation with millions of investors who don’t need permission to move. Stay nimble.