The Federal Reserve would be forced to lower interest rates further, making the dollar even less attractive, and the concomitant shift in global demand away from the US, marked by a sharp decline in the US trade balance, would put still more pressure on the dollar. According to my own calculations in a series of research papers with Maurice Obstfeld, the trade-weighted dollar would likely fall by 20% if a global demand shift (say, due to a US housing recession) were to cut the US trade deficit in half.