Hearing Sandy Will's question, Jester immediately withdrew his gaze.

He is indeed interested in Japan, or to be precise, the yen, and this time, he wanted to discuss this matter with Sandy Will. However, the Plaza Accord is still four months away, and the plan is still in a confidential negotiation. Although some clues have been discovered in some actions by the United States, such things that can affect the rise and fall of an economic power cannot be accurately predicted.

So, Jester pondered for a moment, he glanced at Sandy Will, and then said, "Japan has such a large trade surplus with us, when can our government bear it?"

After hearing Jester's reply, Sandy Will looked at Jester with some surprise. He didn't expect Jester to think of this level.

He pondered for a moment, then asked with a smile on his school entrance exam: "What? Jace, do you think that we can no longer reverse our deficit with Japan by pure business? We have to rely on the administrative power you mentioned? You must know that some people have joined forces before and hoped that our federal government would issue a proposal to restrict Japan's imports to us but it has not been passed."

He couldn't understand these more detailed analyses of Jester's not a professional financial person, but he knew the simplest truth, that is, no country could tolerate such a large trade deficit with a country that was just a vassal state. Even if the government of this country could tolerate it, the citizens of this country could not tolerate it. Now the hostility towards Japan in the United States is very serious. Under this hostility, coupled with a tough president, taking action against Japan has become an inevitable choice.

The previous proposal to restrict imports was not passed, just because the time has not arrived yet. And it is just a small proposal to restrict it, and the Americans have not taken it seriously. In their eyes, if it is better to do it, just do it once.

The Japanese are still immersed in the ecstasy of their growth into the world's second largest economy, and GNP surpasses the United States, and they did not realize that the United States had already prepared a huge conspiracy and was slowly waiting for Japan to be arrested.

Seeing that Jester did not answer the question just now, Sandy Will just smiled distractedly. He continued to say calmly: "How can we save our trade deficit? Will we depreciate our currency?" As he said, Sandy Will's eyes flashed. His tone also became a little stern, "Did you forget the economic disaster in 1977?"

After hearing what Sandy Will said, Jester remembered a disaster that happened in 1977 for the entire American business community. Because it has just passed, it is still very vivid to everyone in this era.

The U.S. trade surplus did not begin in recent years, but it had already begun in 1977. However, it was not as serious as it is now. At that time, the Treasury Secretary of the U.S. Carter administration, Brumesa, used the trade surplus between Japan and the former federal Germany as a reason to intervene in the foreign exchange market, hoping to stimulate US exports through measures to depreciate the US dollar and reduce the US trade deficit. His speech led to investors' crazy selling of the US dollar, and the US dollar depreciated sharply against the currencies of major industrial countries. In early 1977, the exchange rate of the U.S. dollar against the Japanese yen was 1 US dollar against 290 yen, and the lowest in the fall of 1978 fell to 170 yen. The decline reached 41.38%. The U.S. government was shocked. In the fall of 1978, President Carter launched a "Save the US dollar package" to support the price of the U.S. dollar.

Originally, this plan was very good, enough to solve the crisis caused by this inappropriate treatment, but the next second oil crisis completely failed the plan.

It was this oil crisis that broke out at the end of 1979 that led to a sharp rise in US energy prices, and the US consumer price index rose accordingly. The United States experienced severe inflation, with inflation exceeding double digits. For example, when money was deposited in banks in early 1980, the actual rate of return by the end of the year was 12.4%, which means that money could not only not preserve its value in the bank, but would even depreciate at an astonishing rate.

At this most severe moment, Paul Volcker was ordered to take over as chairman of the U.S. Central Bank and the U.S. Federal Reserve Committee. In order to completely reverse this catastrophic inflation, he raised the official interest rate three times in a row and implemented a tight monetary policy. The result of this policy was that the United States had double-digit official interest rates and 20% market interest rates, and the short-term real interest rate rose from an average of nearly zero from 1954 to 1978 to 3%-5% from 1980 to 1984.

High interest rates attracted a large amount of overseas capital to flow into the United States, causing the dollar to soar. From the end of 1979 to the end of 1984, the dollar exchange rate rose by nearly 60%, and the dollar's exchange rate against major industrial countries exceeded the level achieved before the collapse of the Bretton Woods system.

But as the saying goes, good fortune will never come alone, but misfortune will never come alone. It is precisely because the US dollar has appreciated again that the US trade deficit has rapidly expanded. By 1984, the US current account deficit reached a record $100 billion, which also reached the bottom line that the US government can tolerate. They cannot persist in such a deficit in any way. It has become their necessary choice.

However, given the improper handling in 1977, the US government itself did not dare to unilaterally declare its currency depreciation. It is difficult for the United States to bear such an economic disaster.

Thinking of this, Jester thought about what he remembered about the Square Agreement a few months later, and then organized the words before saying, "Grandpa Sandy, have you ever thought about this? What if we did not unilaterally declare the depreciation of the US dollar, but joined forces with other countries of G5 to depreciate the US dollar in an orderly manner?"

"Ha ha!"

Hearing Jester's words, Sandy Will seemed to have heard the funny joke in the world. He looked at Jester with a funny look and said, "Jess, do you know what you said just now? Do you know what this means for other countries?"

Hearing Sandy Will's question, Jester nodded without hesitation, and then said in a sure tone: "Grandpa Sandy, of course I know that doing so is nothing more than to alleviate the United States' economic problems, but they will harm their own interests. After all, if the US dollar depreciates, their exports will inevitably be affected, especially in some countries that can only rely on exports."

"What then?" Sandy Will saw that Jester knew the reason, and continued to ask. He didn't understand why Jester could say the words he had before. How could these countries harm their own interests in order to reverse the economic problems of the United States.

After hesitating for a while, Jester continued: "Actually, Grandpa Sandy, in my opinion, even if these countries do as I said, they may not fundamentally reverse this trade deficit. This manufacturing deficit is caused by our high labor costs, and our economic problems cannot be solved by simple depreciation. The real reason for our economic problems, that is, our crux of the problem, is actually our huge and incredible fiscal deficit. I believe that it is definitely not just one who has the same view as me."

After hearing Jester's words, Sandy Will fell into deep thought and didn't speak for a long time. He also heard some rumors about what Jester said before. Recently, James Baker is frequently contacting several other G5 member states for confidential talks. Their previous talks are extremely confidential. It is logical that it is impossible for the outside world to know, but in the United States, nothing is impossible for these Wall Street giants to do, so some news also emerged.

All those who can learn about these gossips are the top leaders of the giants on Wall Street, and Sandy Will has indeed heard of them.

The news he heard was exactly the same as what Jester said before - what he thought was funny. Now the United States is indeed discussing with several countries in g5 to jointly intervene in the foreign exchange market, so that the US dollar will depreciate in an orderly manner and use it to save the US economy.

But as Jester said before, under this huge trade deficit, such depreciation is nothing to make up for, and the effect can be played is minimal. However, if you don’t do this, you really can’t think of other better ways. As for letting the federal government cut their fiscal budget? Haha, this kind of thing is impossible to pass by one million.

So, thinking of this, Sandy Will looked at Jester in surprise. He really didn't expect that Jester's eyes could see so far, and even something that he hadn't seen through. Jester could say so sure, so he was more interested in Jester's next words. He said with some expectations: "What do you think the depreciation of the US dollar can do?"

"hehe."

Jester just chuckled, revealing a mouthful of white teeth, with a little cold smile, but in a flash, he did not answer the question directly, but told Sandy Will a story: "Grandpa Sandy, I wonder if you have ever heard a story, what will their owner do when the wool of sheep grows?"

When Sandy Will's eyes lit up instantly when he heard Jester's words, he knew what Jester was saying.

It’s just shearing the wool. (To be continued, please search for astronomy, novels are better, updated and faster!
Chapter completed!