MONEY: A Relentless Breeze

For sheer stagecraft. Treasury Secretary John Connally's stopover in Japan last week rivaled a Kabuki drama. Two weeks before his arrival, rumors began emanating from the U.S. and Japan: in exchange for lifting the American import surcharge, Connally would demand that Japan revalue the yen upward by 15%, reduce the number of color television sets, automobiles and other big-selling items it ships to the U.S., pay part of the cost of keeping U.S. forces in Japan and drop trade barriers against U.S. farm goods. The Tokyo press started referring to the Secretary as "Typhoon Connally."

Japanese officials got the message—and...

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