From: Randall Parker 

The Plaza Accord did shrink the US trade deficit. So we have a more recent example
where it worked.

Nixon: The US shortly thereafter experienced the huge increase in oil prices and that
caused inflation and a trade deficit. Plus, the Fed was too loose with the
money supply.

Gene McAloon wrote:

> A falling dollar will do nothing for the trade deficit. Theoretically it
should
> according to classic economic theory, but that theory is far too simplistic.
For
> example, when Nixon lowered the dollar in the early '70s, it had no
significant
> affect on trade. Rather, it made matters worse in that as imports increased
in
> price, US industry simply increased its prices commensurately. The result was
> raging inflation and that without any significant increase in exports, let
alone
> decrease in imports.
>

--- BBBS/NT v4.01 Flag-5