Almost 20 years ago, I went to see economist Lawrence Kudlow speak to my MBA class at Georgia Tech. The CNBC talking head made a bold proclamation: In coming years, the U.S. will become an export powerhouse, creating a rising tide of surpluses as far as the eye could see.

He was wrong, flat wrong.

By the next year, 1993, the U.S. trade deficit (in terms of manufactured goods -- not services), would move above the $100 billion mark.

By 1999, we were importing $300 billion more in goods than we were exporting. The trade deficit has since swelled further; in the last five years, the U.S. trade deficit has averaged a staggering $750 billion.

Our thirst for imported oil explains about half of the problem. A move to far more fuel efficient cars could help to reduce oil imports, as could a shift to natural gas-powered cars and trucks, as the U.S. sits on vast quantities of natural gas.

[Get ready for the natural gas boom: Forget Oil... This Could be The Biggest Story in Energy]

Yet it's the manufacturing sector that's an even bigger concern. 'We don't make stuff anymore' is a refrain heard from the steel mills of Ohio to furniture makers of North Carolina. According to the Bureau of Labor Statistics, employment in manufacturing has fallen by a third in the last decade to around 12 million people.

Why a Falling Dollar Will Renew Vigor in the U.S. Industrial Sector

But signs are emerging that the long decline of the U.S. industrial sector is coming to an end, and Kudlow's bullish forecast of 20 years ago actually looks set to come true in the coming decade. To see why, you have to look at what's happening in China, Japan and Germany, the three other largest producers of industrial goods in the world.

Let's start with Japan. That country has seen its currency, the yen, soar to record heights against the dollar. That means that Japan, which has shipped billion of dollars worth of goods to our shores over the last four decades, has become a very expensive place to do business.

That may explain why auto giant Toyota (NYSE: TM) recently suggested that it might look to close some Japanese factories and boost production elsewhere. The fact that the dollar has lost a lot of ground against the yen means that Toyota's factories in the U.S. have become a lower-cost place of doing business.

In a similar vein, China's currency, the yuan, has also begun to edge up in value. It's a slow process, but over time, China's huge trade surpluses create a lot of pressure on the currency, forcing it upward once China decides to repatriate all of its foreign-earned currency.

Of additional concern in China, workers have been receiving significant pay raises over the last few years, and an increasing number of U.S. companies that operate in low-cost Chinese factories are re-assessing their strategies. An August, 2011 study by the Boston Consulting Group concluded that 'China's overwhelming manufacturing cost advantage over the U.S. is shrinking fast... rising Chinese wages, higher U.S. productivity, a weaker dollar and other factors will virtually close the gap between the U.S. and China.'

A similar scenario may eventually play out vis-à-vis Germany, perhaps the U.S.' most sophisticated rival when it comes to high-end precision machinery. German's export prowess has been tied to the fact that it benefits from a Euro that has been weakened by lagging EU nations such as Greece and Spain.

A rising number of economists think Germany will need to break its currency union with those weaker nations, and whatever emerges from the crisis will reflect a stronger currency in use by Germany. Translation: the U.S. dollar is bound to weaken, making our cars, tractors and other manufactured goods more competitively priced in Germany.

Just as our key trading rivals have seen -- or will see -- their currencies get stronger, the U.S. is expected to see its currency fall in value, simply because of the massive past trade deficits noted earlier. By running trade deficits, a country automatically weakens its currency as acquired goods need to be paid for in the host countries' currency.

The only reason the dollar hasn't already weakened is because it has been seen as a safe harbor in these stormy times. When the global economic crises abate, the dollar is expected to resume its steady downward trajectory that was underway in the middle of the last decade.

[Gold can be a great way to hedge against a falling dollar. See how in 4 Factors That Made Gold This Decade's Best Investment]

What the Future Holds for U.S. Production

Simply put, a weaker dollar means our goods become less expensive in foreign markets, and other countries' goods become more expensive here in the U.S. That means a boost for U.S. products both here and abroad.

Who will benefit? The list is almost too long to count.

The key is to focus on sectors that face competition in the most advanced economies. Low-tech, labor-intensive goods such as clothing, textiles, carpets, and toys will always be made in super-cheap countries like India, Pakistan and Vietnam. Yet a product that requires extensive engineering and advanced production techniques will increasingly be made in America.

Think about cars as an example. Production has become highly-automated and major auto companies use a smaller but more sophisticated workforce to iron out kinks on the production line. A typical U.S. auto industry employee now makes roughly two-thirds what his German counterpart earns, and that wage gap is only likely to grow.

The Investing Answer: America has been running trade deficits for so long that it's hard to conceive of trade surpluses. But for a host of reasons, a key source of U.S. economic weakness appears poised to become a source of U.S. economic strength.

Want to get in on the potential growth of the U.S. industrial sector? Rather than focusing on individual stocks and the inherent company-specific risk that they bring, investors can choose from mutual funds and exchange-traded funds to gain exposure to the industrial sector. For example, the SPDR Select fund -- Industrials (NYSE: XLI) owns a wide range of industrial stocks, many of which happen to be inexpensively priced right now due to global economic concerns. The Vanguard Industrial ETF (NYSE: VIS) is another solid choice.