Capital seeks profit; if the benefits are substantial enough, anything can be sold. The rope used to hang oneself can be clearly priced, so what's a few machine tools?
In fact, there were thousands of cases of improperly selling sensitive products to the Soviets, and before this, it seemed like there hadn't been such a commotion.
"We didn't break any rules. Maybe a slight infraction, but that was just a two-axis machining center, which isn't on the prohibited sales list."
When Toshiba tried to explain this, the Americans laughed, genuinely amused. They knew this bunch of guys would try something like that.
Hmph, did they really think our agents were all incompetent? Sure, that bunch of clowns was useless; it was easy to buy intelligence, yet they still made such a fuss about it.
The American negotiators unhesitatingly tossed a stack of photos right in the Japanese man's face and left without a word.
William White found himself confused. Selling a nine-axis CNC machine wasn't forbidden, so why make the company's logo so prominent? Was he afraid of not making a thorough enough mess, or was he planning to expand into the Soviet market?
With those photos, the Japanese completely gave up resistance. These were internal photos from a Soviet factory, showing not only their CNC machines but also images of props being processed.
It's important to note that the American judicial system operates differently than that of the Japan. You can make mistakes, and if you were unaware, the penalties won't be severe.
For example, murder might not warrant the death penalty, but premeditated murder could lead to execution. For the Americans, these are fundamentally different kinds of mistakes.
Toshiba's predicament was that since they prepared fake documents, it was considered premeditated. If there were a standard for punishment, they would undoubtedly be at the top.
...
"Sir, word has it Japan is cutting interest rates again, following the Federal Reserve. The market is obviously overheated; if they cut rates again, it could lead to serious bubbles."
"Ha, Filson, don't you think all this is part of those old-timers' plan? How long has it been since this Toshiba situation came up? I can't understand how this is even classified as a military-use machine. Is it really that serious? Filson, get ready; we're about to get rich."
Filson was momentarily stunned but soon caught on; he wasn't a fool. Being confused was just a matter of asymmetric information.
"Sir, the exchange rate is only over a hundred now. Your investments have all doubled; if there's another surge..."
Filson couldn't finish; he felt this world was unreal.
"Filson, drastically lowering interest rates is a bad idea for Japan; they're going to pay a heavy price. Look at our buddies in Europe -- they're raising rates. Such an obvious interest rate gap will drive Japan's financial system into chaos; their banks will invest all over the world."
Filson felt a bit glum. His boss was an amateur in finance but had such foresight; he hadn't thought of that angle. Now it wasn't just a matter of selling off shares. Japan's assets would surely swell rapidly.
"Sir, if that happens, Japan's financial system could collapse."
"Yeah, but who cares? Those crazy Wall Street sharks are getting their last piece of the puzzle. Trust me, Filson, they're going to take it all. Keep an eye on things; once they ramp up their investments, we need to unload our shares."
Filson was indeed worried. What if the boss invested a huge amount again, causing him to sink with Japan? Now, it seemed like the boss was chilling, indifferent to the coming chaos, or maybe he was already preparing to make a run for it.
William White was pleased; Japan had compromised, and the Toshiba matter would simply vanish. After all, he had to guard against others stirring up trouble; this so-called world's richest man had a pile of assets in Japan.
...
"William, have the Japanese folks reached out?"
"Ha, George, are they coming for you now?"
"Yeah, I'm a bit hesitant; this risk is a bit high."
"Ha, to force the Japanese central bank's hand, they're desperate. Now that they've cut rates, everything else is nonsense. But it's just not the right time for lobbying. These guys are really unprofessional."
"Ha, that cracks me up. When those photos surfaced, all they could do was bow down."
"Better leave Toshiba alone for now. Next, they'll probably try to split Toshiba from Japan. Those old folks want to convince the public that the Japan is still good, and they're strong supporters -- just that Toshiba is particularly annoying. They'll tell people not to boycott Japan, just give Toshiba a pass. In a few years, it will turn into Toshiba Machinery being especially nasty, while the TVs are still quite good."
Bush Jr. was stunned; he hadn't heard his old man talk about this much complexity before. Was it possible the Japanese had been played again?
"Wow, what a clever design; what's the point?"
"Ha, George, over seventy percent of the funds in the Japan's banking system isn't even theirs -- think about it, who else in this world would have so much money?"
Bush Jr. had a new understanding of Wall Street's greed.
"No way! So wouldn't that mean you'd get rich?"
"Pfft, you know my attitude towards money -- it's not important."
Bush Jr. hung up, cursing William White for being such a jerk -- this was a blatant showoff.
"Hey, hey, hello! Hello! Ugh, what a rude guy."
...
Just like during the Black Ships incident, the Americans were feeling pretty pleased; they got everything they wanted and dumped all the humiliation and losses onto Japan.
However, opening up finance was a double-edged sword. The Japan's consortium indeed required it. Without American pressure, there would have been no changes.
When the Japan's bubble economy collapsed, it was quite a disaster; people were queuing to jump off buildings. The entire country was teetering on the brink of collapse.
But after such a painful lesson, their investors grew cautious, and their ability to control risk became top-notch.
*****
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