Macro Musings with David Beckworth Steve Kamin and Mark Sobel on the Outlook of Dollar Dominance
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Apr 6, 2026 
Mark Sobel, a veteran U.S. Treasury official now leading discussions at OMFIF, and Steve Kamin, an international macro expert formerly at the Fed, explore the outlook for dollar dominance. They debate near-term threats like tariffs, fiscal deficits, and strained alliances. They weigh stablecoins, Treasury FX report findings, tariff tools, and whether a second China shock is underway.
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Fix Fiscal Deficits To Protect The Dollar
- Prioritize fixing US fiscal trajectory to sustain dollar dominance.
- Steven Kamin identifies high public debt (around 100% of GDP) and projections toward 150% as the primary long-term vulnerability.
Stablecoins Could Help But Won't Rescue The Dollar
- Dollar-pegged stablecoins could raise incremental demand for US assets but likely only modestly relative to total treasuries.
- Steven Kamin estimates up to $2.6tn new dollar demand from stablecoins versus a $43tn relevant USD asset universe (~6%).
Mark Sobel Warns About Stablecoin Risks
- Mark Sobel expresses skepticism about stablecoins, calling them likely non-additive and risky for criminality and money laundering.
- He points to Tether's opaque reserves and El Salvador's involvement as warning signs.