A User’s Guide to Restructuring the Global Trading System- Stephen Miran

[김씨]

개요 :

미국 부채가 넘 많아서 부채에 대한 이자 갚기도 힘듬.

따라서 난 포기하고 싶은데 마지막 방법을 쓰는 거임.

제2의 플라자 합의 하자(마라라고 협약), 각국은 화폐가치를 높여, 그리고 우리 단기채 말고 장기채로 사줘

그래야 부채에 대한 이자를 그나마 갚을 수 있어

안그르면 파산할꺼야

내가 파산하면 너희 안보는 누가 책임져줄 수 있니

만일 안하면 우선 관세로 혼내줄꺼야.

Executive Summary

The desire to reform the global trading system and put American industry on fairer ground vis-à-vis the rest of the world has been a consistent theme for President Trump for decades. We may be on the cusp of generational change in the international trade and financial systems.

미 산업의 붕괴와 적자무역 시스템 개혁

The root of the economic imbalances lies in persistent dollar overvaluation that prevents the balancing of international trade, and this overvaluation is driven by inelastic demand for reserve assets. As global GDP grows, it becomes increasingly burdensome for the United States to finance the provision of reserve assets and the defense umbrella, as the manufacturing and tradeable sectors bear the brunt of the costs.

무역 불균형에 따른 달러 강세 그리고 미 국채 보유자산 증가에 따른 미 부채 증가

In this essay I attempt to catalogue some of the available tools for reshaping these systems, the tradeoffs that accompany the use of those tools, and policy options for minimizing side effects. This is not policy advocacy, but an attempt to understand the financial market consequences of potential significant changes in trade or financial policy.

불균형 해소를 위한 몇 가지 제안

Tariffs provide revenue, and if offset by currency adjustments, present minimal inflationary or otherwise adverse side effects, consistent with the experience in 2018-2019. While currency offset can inhibit adjustments to trade flows, it suggests that tariffs are ultimately financed by the tariffed nation, whose real purchasing power and wealth decline, and that the revenue raised improves burden sharing for reserve asset provision. Tariffs will likely be implemented in a manner deeply intertwined with national security concerns, and I discuss a variety of possible implementation schemes. I also discuss optimal tariff rates in the context of the rest of the U.S. taxation system.

관세로 미 부채를 줄이고 달러 약세를 통한 물가 및 부가효과 기대. 관세는 국가안보 고려.

Chapter 4: Currencies

In the Triffin world, the demand for reserve assets causes persistent deviations from the equilibria in currency markets that would balance trade. This disequilibrium in trade occurs because the real exchange rate is too strong. Exchange rate overvaluation can be redressed by tariffs, as discussed above, or by addressing the undervaluation of other nations’ currencies, as occasionally floated by President Trump, Vice President-elect JD Vance, and former Trump Administration officials like Peter Navarro and Robert Lighthizer.

트리핀 딜레마를 깰 수 있다 주장하는 트럼프, 밴스부통령, 피터 나바로, 로버트 라이트하이저.

Currency policy brings different considerations than tariffs do. The principal risk of pursuing a fairly valued dollar is that the policy intervention makes dollar assets less attractive in the eyes of foreign investors. At the time of writing, the yield on ten-year UST debt is roughly 4.25% per year. Suppose movement towards the currency valuation that would arise in a trade balance equilibrium would result in foreign holders of USTs expecting a 15% reduction in the domestic value of their UST holdings: that represents almost four years’ worth of interest payments, and over a third of all the expected interest over the life of the note. Three-year UST debt yields 4.1%, implying the deval‎uation would eat more than all expected interest, i.e. the note holder loses money over the life of the security.

인위적 달러 저평가 개입이 해외 투자자들에게 달러 자산에 대한 투자의 매력을 떨어뜨릴 수 있다는 것을 알고 있다.

These risks can be a disincentive for holding dollar-denominated fixed income securities. If an expected change in currency values leads to large-scale outflows from the Treasury market, at a time of growing fiscal deficits and still-present inflation risk, it could cause long yields to rise. Because significant portions of the economy—like housing—are tied to the belly and long end of the yield curve, such a rise could have material adverse consequences.

해외 투자의 탈출은 장기 수익률에 영향을 미치고 이는 경제와 모기지와 연동, 역효과

This risk will be somewhat compounded if inflation remains elevated. As discussed in the section on tariffs, the results in Gopinath (2015) indicate that a 20% depreciation in the dollar would boost CPI inflation by 60-100 basis points. A one-time adjustment in the currency without second-round effects should be looked through by the Fed as a price-level rather than inflation-rate shift. However if the Fed believed it to persistently shift the rate of inflation rather than just the price level, under standard Taylor rule specifications, it would hike overnight rates by roughly 100-150 basis points.

달러 저평가에 따른 소비자 물가 상승으로 FED는 테일러 준칙적용

Whether the Fed decides to offset any price consequences from a weaker dollar will depend on whether it is concerned by so-called second-round effects, that the initial move in currencies is leading to subsequent rounds of price hikes by firms. Second-round effects are highly dependent on economic context, meaning that if there are numerous other inflationary cross-currents, they are likelier to occur. It will therefore be important for the Trump Administration to carefully choose its moment for such a policy change or to coordinate currency policy with deflationary regulatory and energy policy.

단순 달러약세에 따른 1차 물가상승 뿐 아니라 2차효과 심각, 따라서 주의해서 트럼프는 사용 권고

The disincentive for holding equities is somewhat mitigated, as earnings rise to offset some of the currency losses. A significant portion of sales made by S&P 500 companies come from abroad16, and those sales are worth more in dollar terms as the dollar depreciates. Earnings will increase as companies are able to increase selling prices. While higher yields may weigh on multiples, the increase in earnings can mitigate volatility.

S&P500기업의 상당수는 해외매출, 따라서 달러가치 하락에 따른 매출증대, 이익률 증가로 변동성 완화가능.(달러가치 하락에 따른 매출증대를 기대하는 매우 우매한 생각,

화폐량과 화폐가치에 대한 개념 무)

It is worth repeating that many of these policies are untried at scale, or haven’t been used in almost half a century, and that this essay is not policy advocacy but an attempt to catalogue the available tools and analyze how useful they may be for accomplishing various goals.

자신할 수 없지만 시도해볼만 하다.(시도해보고 망하면 할 수 없지 뭐)

Multilateral Currency Approaches

Historically, multilateral currency accords have been the principal means of implementing intentional changes in the value of the dollar. The Plaza Accord of 1985, in which the U.S., France, Germany, Japan and the U.K. coordinated to weaken the dollar, and the Louvre Accord of 1987, which halted such weakness, are generally regarded as successful approaches to adjusting currency levels (though their economic consequences are somewhat more disputed).

1985년 다자간 화폐강제협약, 플라자와 같은 협약을 다시 한다면 달러약세로 미국의 패권을 지킬 수 있다.

Because the value of the dollar in foreign exchange is also dependent on the forces affecting trading partners’ currencies as well, coordination with those partners on the goal of changing the dollar’s value can be very helpful. Today, the two other major currencies are the euro and the renminbi, though the yen is also of import.

따라서 현 유로, 인민폐, 엔화가 해당됨.

As things stand, there is little reason to expect that either Europe or China would agree to a coordinated move to strengthen their currencies. European real GDP growth has been below 1% for almost three years, and the rise of the Chinese auto export industry has Europe so concerned it is implementing its own set of protectionist measures to limit imports. And Chinese domestic growth has been so weak that China has chosen to double down on its mercantilist, export-led model to secure marginal income, much to the rest of the world’s consternation. Indeed, China was basically a non-player in global auto exports just a few years ago, and has now rocketed up to be the world’s biggest auto exporter.17 Neither Europe nor China will be in the mood to curtail their industrial subsidies and other market interventions that would reallocate tradeable manufacturing demand away from themselves and toward the United States.

현 유로와 중국은 자국 통화의 강세를 원하지 않는다.

Japan, the U.K., and potentially Canada and Mexico, might prove more amenable to currency intervention, but aren’t large enough in today’s global economy to accomplish the desired end.

일본, 영국, 캐나다, 멕시코는 협의할 수 있으나 미국의 목적달성에는 아직 규모가 작다.

Instead, recall that President Trump views tariffs as generating negotiating leverage for making deals. It is easier to imagine that after a series of punitive tariffs, trading partners like Europe and China become more receptive to some manner of currency accord in exchange for a reduction of tariffs.

따라서 가혹한 관세로 협상력을 높여 유럽과 중국이 통화강제협약(제2플라자)에 따라올 수 있도록 할 수 있다.

As currency accords are typically named after resorts where they are negotiated, like Bretton Woods and Plaza, with some poetic license I’ll describe the potential agreement in the Trump Administration as others have done as the prospective “Mar-a-Lago Accord.”

제2의 강제 통화협정의 이름이 트럼프는 “마라라고 협정”이라 한다.

However, there are many differences between the economy today and that of the 1980s. For one thing, gross U.S. debt as a share of GDP is now in excess of 120%, relative to roughly 40% when the Plaza Accord was agreed. That drives concerns about the consequences for the debt market that didn’t exist in the 1980s.

1980년 플라자합의시 미 부채는 GDP대비 40%, 그러나 현재 120%, 따라서 지들도 겁난다.

One suggestion put forth in Poszar (2024) is for any accord to incorporate a duration agreement. Poszar’s hermeneutics of the remarks of likely economic policy leaders in a second Trump Administration explicitly links the U.S. provision of a security umbrella to the international financial system, and infers that efforts to reduce interest rates can help finance the security zone. He synthesizes the following Mar-a-Lago Accord from potential policymakers’ remarks:

미 안보우산 제공대가로 미 부채를 줄이기 위해 아래와 같은 말라라고 협정이 필요합니다.

“1) security zones are a public good, and countries on the inside must fund it by buying Treasurys; 안보(공공재) 대가로 미국체를 지속 사라.

2) security zones are a capital good; they are best funded by century bonds, not short-term bills; 안보(자본재) 대가로 단기국채가 아닌 장기국채 사라. (장기 국채이자율이 넘 높아서 이자를 감당할 수 없다)

3) security zones have barbed wires: unless you swap your bills for bonds, tariffs will keep you out.”  (Poszar, 2024.) 안보 대가로 채권을 사지 않는다면 관세로 죽이겠다.

To strengthen their own currencies, reserve managers must sell dollars. As their own currencies appreciate, the United States will receive a competitiveness advantage helping our tradeable and manufacturing sectors.

미국의 무역과 산업을 위해 타 국가는 무조건 달러를 내다 팔아라.

To help mitigate potential unwanted financial consequences (like higher interest rates), reserve selling can be accompanied by term-out of remaining reserve holdings. Increased demand for long-term debt by reserve managers will help keep interest rates down, even if there is overall selling of USD fixed income as a result of the currency adjustment. Reserve owners hold fewer USD reserves, pushing their currencies higher, but the reserves they do hold are longer duration, helping contain yields

미 장기채 강제 매입시 단기채 매도로 금리하락, 장기채 전환으로 금리하락 유도

(결국 자국 부채 이자를 줄이기 위해… 그러나 이건 매우 불가능 시나리오)

If the term-out is into special century bonds as suggested by Poszar, then the funding pressure on the U.S. taxpayer for financing global security is significantly alleviated. The U.S. Treasury can effectively buy duration back from the market and replace that borrowing with century bonds sold to the foreign official sector

장기채로 전환되면 세계안보가 좋아진다. (나 먼저 살아야 한다)

Such a Mar-a-Lago Accord gives form to a 21st Century version of a multilateral currency agreement. President Trump will want foreigners to help pay for the security zone provided by the United States. A reduction in the value of the dollar helps create manufacturing jobs in America and reallocates aggregate demand from the rest of the world to the U.S. The term-out of reserve debt helps prevent financial market volatility and the economic damage that would ensue. Multiple goals are accomplished with one agreement.

미국은 안보를 유지하기 위해 마라라고 협약 과, 미국 제조업과 부채를 위해 다자간 통화협정이 필요. (미국의 놀고먹기 연장을 위한 필수, 하지만 이미 게으른 미국은 안됨)

But the term-out of reserve debt shifts interest rate risk from the U.S. taxpayer to foreign taxpayers. How can the U.S. get trading and security partners to agree to such a deal? First, there is the stick of tariffs. Second, there is the carrot of the defense umbrella and the risk of losing it. Third, there are ample central bank tools available to help provide liquidity in the face of higher interest rate risk. Ex ante, there were also numerous doubts and questions about Trump’s ability to secure improved trade terms from Mexico and Canada, Korea, and China, and yet he succeeded.

이를 위한 강제방안 : 1. 관세, 2방위비, 3.달러 유동성 조이기.

과거 트럼프 1기때 멕시코,케나다,한국,중국에 강제해봤다.

Recall that the purpose of official sector currency reserves is to defend the value of the currency in the face of market volatility and finance imports in a potential crisis. The reason reserve managers tend to keep duration risk low is because they need to be able to liquidate reserves to defend their own currencies when volatility spikes. If they experience losses on their holdings because interest rates increase, they have reduced firepower for defending their currencies. Longer term debt is less liquid than short-term debt, and crossing bid-offer spreads can be costly in ultra-long-term debt.

장기부채가 단가부채보다 유동성이 낮아 금융위기시 안전하다고 우김.

This mark-to-market risk of holding longer-term debt can be mitigated via swap lines with the Federal Reserve, or alternatively, with the Treasury’s Exchange Stabilization Fund. Either institution can lend dollars to reserve holders at par against their long-term Treasury debt holdings, as a perk of being inside the Mar-a-Lago Accord. Such liquidity obviates the risk of mark-to-market loss on long-term debt, since reserve managers will always have access to liquidity at the face value of the debt. As Poszar (2024) points out, the Bank Term Funding Program which the Fed used to respond to the regional bank stresses of spring 2023 provides a model. Holding century bonds is less risky for reserve managers if they have access to swap lines granting them substantial short term dollar liquidity. The desire to maintain access to such swap lines will be a powerful long-term incentive for remaining inside the U.S. security and economic umbrella.

장기채권 보유하면 위기 시 유동성 공급해줄께

Such an architecture would mark a shift in global markets as big as Bretton Woods or its end. It would see our trading partners bear an increased share of the burden of financing global security, and the financing means would be via a weaker dollar reallocating aggregate demand to the United States and a reallocation of interest rate risk from U.S. taxpayers to foreign taxpayers. It would also more clearly demarcate the lines of the American defense umbrella, removing some uncertainty around who is or is not eligible for protection.

세계 안보자금을 분담해서 낸다고 생각해라

Chapter 6: Conclusion

The next Trump term presents potential for sweeping change in the international economic system and possible accompanying volatility. It is important for investors to understand the tools that might be employed for such purposes, as well as the means by which government may attempt to avoid unwelcome consequences. This essay attempts to provide a user’s guide: a survey of some tools, their economic and market consequences, and steps that can be taken to mitigate unwanted side effects.

트럼프가 바꿀 모든 것에 준비하시고 부작용 발생시 사용자 책임

Wall Street consensus that an Administration has no means by which to affect the foreign exchange value of the dollar, should it desire to do so, is wrong. Government has many means of doing so, both multilaterally and unilaterally. No matter what approach it takes, however, attention must be paid to steps to minimize volatility. Assistance from trading partners or the Federal Reserve can be helpful in doing so.

트럼프는 일방적이든 아니든 달러가치를 변동시킬 것임. 무역 파트너 또는 연준이 지원.

In any case, because President Trump has shown tariffs are a means by which he can successfully extract negotiating leverage—and revenue—from trading partners, it is quite likely that tariffs are used prior to any currency tools. Because tariffs are USD-positive, it will be important for investors to understand the sequencing of reforms to the international trading system. The dollar is likely to strengthen before it reverses, if it does so.

화폐가치 조정 이전 트럼프는 관세 협상 지렛대 수단을 보여줬기 때문에 투자자는 조심해라.

There is a path by which the Trump Administration can reconfigure the global trading and financial systems to America’s benefit, but it is narrow, and will require careful planning, precise execution, and attention to steps to minimize adverse consequences.

이 모든 일을 조심이 하겠다.

A User's Guide to Restructuring the Global Trading System-Stephen Miran.pdf

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