The Impact Of The Plaza Accord

The economy began to recover in 1983 and was surging in 1984. Unemployment and interest rates dropped, allowing more Americans to buy homes and cars (Moss & Thomas, 2013, p. 236). Inflation dropped to four percent, the lowest since the early 1970s. Americans were earning more money, and oil prices were dropping, making fuel more affordable (Moss & Thomas, 2013, p. 236). “Economic growth generated 18 million new jobs and tripled the price of stocks by 1990” (Moss & Thomas, 2013, p. 236).

Conte & Karr (2001) report the economic growth of the 1980’s in the United States sees President Regan cutting taxes and slashing social programs. President Reagan also

Reagan had the same economic problems that his predecessor Jimmy Carter faced as president. One of these problems was very bad inflation in the economy.

The Economic Effect on Japan during Post World War II Japan’s economy was greatly affected by the atomic bombs dropped on both Hiroshima and Nagasaki. Japan’s economic recovery as a result of this incident transformed Japan’s economic growth which has become known as the “Economic Miracle.” The bombs caused Japan to reconstruct many more facilities in which the economy moved forward. The Economic Planning Agency, which used to be known as the Economic Stabilization Board, helped Japan to become one of the leading economic nations. The United States also contributed to much of Japan’s recovery by occuping it from 1945-1951.

Reagan was just elected president, but that did not mean he did not have a lot of work ahead of him. As soon as he got elected, he had to deal with the collapsing economy. In 1980, the rate of inflation reached 13.5 percent,

Reagan increased defense spending. U.S. exports were falling, creating a negative balance of trade where the country was buying more from foreign countries than it was selling to them.

The United States began to reach outward for trade, showing interest in Japan. Almost forcing the country to begin to trade with the U.S.

Short term interest rates cut the rise of inflation. In the 1960’s price stability was sharped in the financial market. The United States treasury rates were at a 6 percent. In 1969 interest rates were at an all time high of 9 percent. The interest rates in 1960 fluctuated up and down. From a 4.08 in 1962 to 5.53 In 1968. Less interest added money into the economy. When the interest rate was low in the 1960s it helped bring the united out of the recession that had developed. According to encyclopedia.com foreign trade helped economic growth. The trade expansion act which was granted in 1962 allowed more power to the president. Tariffs rates were lowered between 35 to 40 percent. Us imports increased by 150 percent from 1960 to 1967.

America was being paid back loaned that it had lent other countries during the war, on top of this they were making interest. The banks now had lots of money to lend to people setting up a business or for people to buy on the margin.

The events leading up to World War 2 and everything after were some of the biggest impacts on America’s relationship with Japan. The bombing of Pearl Harbor And America’s economic power was the start of Japan and United States conflicts in the mid 1900’s. In the end Japan and America came together with the Treaty of Mutual Cooperation. With the hopes to never have the same problems as what they had during World War

Prior to Reagan’s inauguration the country was suffering from double-digit inflation, high interest rates, high unemployment, oil shortages, and

Japan’s unemployment rate of about 4% opposed to the U.S. unemployment rate of close to 10%. Even the financial debt to GDP ration is an advantage, and debt in the private sector has not increased unlike the U.S. and European countries, (Time, 2009). In addition, since Japan is a huge exporter and with the U.S. demand going downward, the international balances and growth declined especially as the dollar value dropped and the yen surged. •

The initial spell of the implementation of the Dodge Plan caused Japan to enter into recession, which resulted in an increase in

Interest rates were extremely high in the early part of the 1980's due to Reagan's foreign policy efforts to get rid of communism. The amount of interest rates was

The deregulation of financial markets catalysed by Globalisation worldwide has impacted on the amount of trade within the Japanese economy beneficially allowing easier access to foreign currencies, facilitating a higher flow of goods between nation, by relaxing laws that severely prevented foreign buying of currency, and floating the yen. These drivers have helped boost Japan's trade and recovery from its recession. Technology has allowed finances to be traded and communication to be near to instantaneous. This has increased dramatically the amount of FDI into Japan largely thanks to the numerous strategies the Japanese government has taken to promote economic growth and hence development. Finance and Foreign Direct Investment (FDI) have increased as a direct result of globalisation doubling from $63 billion in 2001 to $144 billion in