On Wednesday, February 13 then Secretary of Treasury nominee Jack Lew stated at his Senate confirmation hearing that if confirmed, he would maintain strong dollar policy.
In defense of his pro-strong dollar stance, Lew said “Treasury has had a longstanding position that a strong dollar is in the best interest of promoting U.S. growth and competitiveness, and if confirmed I would not change that policy.” (Source: Washington Post)
Our debate wants to shed light on the implications of having (or not having) a strong dollar policy. When the US adopts a strong dollar policy, the policy keeps inflation low, encourages foreign investment, and maintains the currency's role in the global financial system. However, a weak dollar in times of recession, makes American goods cheaper, and stimulates manufacturing and job growth, is preferable to a strong dollar.
Our debaters for the motion are Frederic Mishkin, Professor at Columbia Business School and John Taylor, Chairman and Founder of FX Concepts find that flexibility during periods of financial hardships may be a good move. Our debaters against the motion are Steve Forbes, Chairman and Editor-in-Chief of Forbes Media, and James Grant, Editor and Founder of Grant’s Interest Rate Observer both panelists believe that a weak dollar will just lead to high inflation and low purchasing power.
Now that you know what to expect under our new Secretary of Treasury, where do you stand? Are you a proponent of the strong dollar policy or not? Cast your vote online, and visit our research section to brush up on the topic before our debate on March 13!