Tax Reform, Trade & The US Dollar Paradox

Net, net, this tax reform bill could a few very notable things from a macroeconomic and balance of payments perspective if economic agents obey the incentives. First, on the margin it incentivizes capital investment in the United States by, at least temporarily, raising the return on invested capital for owners of said capital. Second, it will add about $1tn of debt to the nation's balance sheet over the next ten years after taking into consideration the boost to growth the bill could generate.