Hey, hey, I didn't say there wasn't an essential relationship between the tax cuts and the budget deficit. Indeed, as Uncle Milton (of blessed memory) used to say, "to spend is to tax." Cutting taxes without cutting spending is really not a tax cut at all; it's a promise that you're shifting taxes from the present into the future. (And if you refuse to raise taxes in the future, then you'll have inflation, which is a kind of tax.)

What I was saying was that according to orthodox economics, a budget deficit will cause the real exchange rate to increase (i.e., cause the dollar to strengthen).