Listen: Why a Mar-a-Lago Accord would be an act of self-harm

The root cause of America's economic imbalances can be traced to a single factor: the strength of the US dollar. At least, that’s the view of Stephen Miran, President Trump’s newly appointed Chairman of the Council of Economic Advisors.

In an essay published late last year, Miran argued that the dollar's strength, driven by inelastic demand for Treasuries and the dollar’s status as a global reserve currency, has resulted in persistently cheap imports, reduced the competitiveness of its exports, eroded US manufacturing, and led to soaring deficits.

His answer to this problem is a so-called Mar-a-Lago Accord, where trading partners would sell dollars and US Treasuries from their FX reserves or face higher tariffs and the removal of security guarantees.

But is an overvalued dollar really to blame for America’s financial problems? Would trading partners agree to such a plan? And what could it mean for the US markets?

In this podcast, ING's Global Head of Markets, Chris Turner, and Regional Head of Research for the Americas, Padhraic Garvey tell Senior Editor Rebecca Byrne why they think the dollar is being used as a scapegoat, and any plan to weaken the currency by coercion would be fraught with risk.