Pressure From Abroad

The U.S. is hit by Tokyo and a sliding dollar

The U.S. once saw itself as an economic island, so large and strong and independent that it could all but ignore the rest of the world. That view has long been obsolete, and events last week provided fresh and painful evidence of how closely American interests are tied to decisions made in other countries. On international money markets, nervous traders sent the formerly high-flying dollar into one of its sharpest and fastest tailspins ever. The plunge caused fears in some quarters that a protracted slide in the currency's value could be getting under way.

Meanwhile, policymakers in Tokyo outraged the Reagan...

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