Return to 78: Why are all the Americans panicking about doing scientific research?
Chapter 367 Big Collapse
Relying on years of economic dividends, luxury goods have become cheaper than cabbage for young people on the island.
The appreciation of the currency will further enhance their purchasing power, and no one doubts that the island nation's economy will suffer setbacks.
No one is worried that the island nation will remain the world's second largest economy forever.
Soon, the island nation will surpass the United States and become the world's largest economy.
Twenty years of trade surplus has given the island nation a mysterious confidence it has never had before.
The purchasing power between last year and this year is undergoing dramatic changes.
In a five-star hotel not far from the downtown area of the metropolitan area, Chief Mustafa was smoking a cigarette and standing in front of the floor-to-ceiling window looking at the bustling street scene.
"Your Highness, this scene will soon disappear. What will replace it is panic. The money in your hands will no longer be valuable."
Chief Mustafa smoked his cigarette in silence.
Tonight, the two came to the island country.
After completing the check-in procedures and on the way to the room, Chief Mustafa habitually tipped the waiter.
Seeing that Chief Mustafa only offered one hundred US dollars, the waiter showed a contemptuous expression.
Because he felt that what he gave was too little, Chief Mustafa took out another hundred US dollars as a tip, but the other party still looked disdainful.
It was as if the tip Chief Mustafa gave was not a hundred dollars, but one dollar.
Even a waiter can be so rampant, which shows how easy it is to make money in the island country.
"It's almost over..."
Chief Mustafa put his cigarette into the ashtray and said indifferently, "I bet that by next year, there will be a large number of commodity recycling stores on the island."
"It's inevitable."
Lin Kaifeng shrugged his shoulders and said, "Your Highness the Chief is visiting the island country for the first time and doesn't know much about many things. As far as I know, the islanders never have the habit of giving change when taking a taxi. If the fare is only a few hundred, the other party will definitely give 10,000. If the fare exceeds 10,000, then they will give 20,000."
"Anyway, they will use integers for calculations. Rich Japanese people are so willful."
"Haha, they will soon stop being so willful."
Chief Mustafa said meaningfully.
Three days later, the island nation's currency stopped depreciating and began to rise.
The speed is like a rocket engine.
In just one day, the island nation's currency appreciated to an unbelievable level.
Correspondingly, the US dollar plummeted.
The island nation's currency appreciated by more than 17%, while the U.S. dollar depreciated by more than 10%.
Lin Kaifeng and Chief Mustafa immediately exchanged the large amount of US dollars in their hands into the island country's currency.
International investors who have been waiting for a long time have poured in funds.
The turmoil in the foreign exchange market has officially begun.
"Mr. T.P., we need to immediately invest new funds to rescue the market. The dollar is depreciating faster than we expected. If we don't intervene, the dollar will collapse."
"Our plan is to allow the dollar to depreciate to a limited extent, not to plunge like it is now. The amount of rescue funds must be large. If we only invest 20 to 30 billion each time like in the previous few times, it will not help the market turmoil."
United States, circular office.
Heads of various economic sectors gathered here.
President Reagan frowned. If more than 100 billion US dollars were invested, it would inevitably affect the financial appropriations of various departments in the United States this year.
In order to fight against the Soviet Union, the United States maintains a huge army, and its annual military expenditure is astronomical.
As expected, the US dollar began to depreciate.
However, as expected, another accident occurred.
The depreciation speed of the US dollar is like a runaway horse and is completely out of control.
Just now, the depreciation of the US dollar soared from 11% to 16%.
Commander Reagan was silent for a while, then asked, "Could someone be behind this?"
As soon as these words came out, everyone looked at each other in shock.
If someone is secretly doing something fishy, the amount of money the other party invests in the foreign exchange market will be an astronomical figure.
American financial groups will not do such things that harm others and benefit themselves, and Western investors dare not go against the United States.
Once the United States finds out, they will surely face a catastrophic disaster.
Not long ago, the United States just punished Dongzhi Company.
The huge enterprises were broken up into countless small companies, and heavy taxes were imposed on all island products.
Dongzhi Company has already given everyone a perfect demonstration of the consequences of going against the United States.
Seeing that no one could answer his question, President Reagan said gloomily, "Gentlemen, if we put 150 billion US dollars into the market, it will seriously affect our various planned expenditures."
"At present, the only things we can move are military and aerospace spending. If military spending decreases, the consequences will be very serious."
"Mr. President, if you don't find a way to deal with military spending, then we can only..."
A senior cabinet official hesitated to speak.
If President Reagan is unwilling to touch military spending, he may have no choice but to cut the funding the United States spends on the Star Wars project.
Ask NASA for money.
A few years ago, the US government carried out a small-scale currency devaluation.
It turns out that currency depreciation can be artificially intervened.
Relying on the previous experience, the United States deployed a larger economic plan.
But now, the situation is beyond the control of the United States.
The US dollar is depreciating at an increasingly rapid rate.
When everyone held a meeting to discuss whether to invest a large amount of money to rescue the market, the US dollar collapsed again.
The depreciation rate increased from 16 percent a few hours ago to 22 percent.
"I will try to convince Congress to increase annual appropriations. Funding for Star Wars must not be touched, and military spending cannot be reduced."
After careful consideration, President Reagan found that he had no choice but to squeeze money from other places.
Lin Kaifeng's three tricks are far more than that.
Shorting foreign exchange is the first set of three tactics.
At this unfavorable moment when the island nation's currency and the US dollar have been hit one after another, the stock prices of many of the island nation's conglomerates and groups are also changing.
The decline of the US dollar has little to do with the island country.
In other words, the people of the island don't care how much the US dollar falls.
They only care about how much the money in their hands can appreciate.
The continuous appreciation of the currency has led to unprecedented prosperity in the island nation's stock market.
One conglomerate and company after another saw their share prices rise to an absurd level.
No matter how outrageous it is, it can't stop the people's madness.
In two months, all aspects of the island country have shown unprecedented prosperity.
The Plaza Accord formulated by the United States not only failed to solve the persistent unemployment and high inflation.
On the contrary, under the influence of currency depreciation, local inflation has become increasingly severe.
If it was just a minor problem before, it has now turned into a raging fire.
President Reagan faced a difficult decision.
Should the decision-makers he represents cut funding for Star Wars or the military?
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