When Everyone Was
Once Convinced Japan Would Buy Up Everything In America
The value of the Japanese dollar is falling
again, now that new Prime Minister Shinzo Abe
has pledged
to reinflate the country by instructing the
country's central bank to make asset
purchases.
It's now pretty inconceivable that a Japanese
company would be able to snap up American
corporate assets as investments.
In the eighties, it was a fact of life.
Starting with a relative trickle at the
beginning of the decade, Japanese
conglomerates went on an epic buying spree in
America during the latter half of the decade
after both countries agreed to revalue their
currencies.
The trend became so widespread that
the "corporate Japanese takeover" concept
began leaking into American culture.
Via Google News, we
now take you on a tour of this singular
moment in the life of both countries...
It started out
innocently enough — for instance, some
Japanese automakers coming over to put
American parts in their cars.
Meanwhile, American
firms like Motorola were still finding
Japanese buyers for their products — including
beepers.
But the country's
influence was starting to be felt — not just
in America's cosmopolitan corners, as this
article noted, but even in Texas, Arkansas and
Mississippi, whose museums now featured
Japanese exhibitions.
Durant
Daily Democrat/Google News
Then the trend got real,
with a conglomerate purchasing a steel company
wholly owned by Ford.
But we hadn't seen
anything yet.
At the time the value of
the U.S. dollar had exploded...
...Resulting in a major
U.S. trade gap.
So in September 1985,
the G-5 countries signed the Plaza Accord. The
non-American ones pledged more liberal trade
policies to try to close the gap.
It worked — the value of
the dollar fell dramatically against the yen.
But it may have worked
too well, because Japanese commenced a "buying
spree" that would last another the rest of the
decade.
Albany
Herald/Google News
For the rest of the
decade, Japanese conglomerates snapped up any
U.S. asset they could get their hands on.
Milwaukee
Journal/Google News
Even the most marquee
ones.
Eugene
Register-Guard/Google News
Old-school columnists
like Paul Harvey were outraged and warned of
"an economic Pearl Harbor."
Kentucky
New Era/Google News
Suddenly, Hollywood
started introducing Japanese bosses. Here's a
scene from Steven Spielberg's "Back To The
Future 2" showing how Japanese companies would
dominate.
Much of "Die Hard"
starring Bruce Willis took place in a Japanese
building in Los Angeles.
Anyone growing up in the
'80s will remember the cartoons from Japan...
...American children got
used to seeing Japanese names during the
closing credits of their favorite cartoons.
Even the Japanese
themselves started getting freaked out about
their prosperity. "The amount of money spent
for pet food now exceeds the defense budget,"
wrote Georgie Geyer.
Others were more
sanguine. "By American super-power standards,
Japan is still a minor-league player," wrote
Ben Wattenberg.
But the Japanese
purchasing machine couldn't be stopped:
hotels..
Tire companies...
Reading
Eagle/Google News
The climax came in
November 1989, when the Mitsubishi company
bought Rockefeller Center for $846 million.
As Union College
economics professor would observe, "Sony
chairman Akio Morita might be excused for
asking bluntly, 'What was it you said you
wanted?"
Schenectady
Gazette/Google News
But that was the
eighties. If you don't know what happened
next, read on...
With all that spending,
inflation in Japan exploded.
In December 1989,
Yasushi Mieno took over as Bank of Japan
president and immediately raised rates.
The market caught a
glimpse of itself in the mirror, and screamed.
Eugene
Register-Guard/Google News
But Mieno kept raising
rates.
The
Deseret News/Google News
The decade-long
correction had begun...
The
Press-Courier/Google News
And Japan began its
retreat from the U.S.
In the long run, we came
to welcome Japan as a prosperous trading
partner...
...Though we still
occasionally break out in hysterics when a
rising East Asian power comes knocking.
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