This research presents an in depth discussion and analysis on U.S. Japanese foreign trade. It is divided into two parts. The first hypothesis states that the appreciation of the dollar in the early eighties is positively correlated with the U.S. trade deficit, especially with Japan. The second hypothesis states that Friedrich Von Hayek's Theory of Social Order applies to the development of capitalism in that country. This can also be divided into two parts, a) this generation of Japanese consumes, saves, and invests differently than previous generations, and b) Japanese consumption and investment patterns follow U.S. consumption and investment patterns with a lag.

During World War II, the Japanese earned the reputation for cruelty toward their prisoners which surpassed the treatment accorded to POWs held by Germany and Italy. The conduct exhibited by the Japanese soldier was the result of a combination of ancient social and religious traditions made manifest by twentieth century documents. Through constant inculcation of ancient myths nurtured by a national religion, the Japanese believed that their holy mission was world domination. Believing themselves to be of divine origin, they treated all other races as inferior; therefore, the POWs suffered cruelties as sub-humans. The Japanese inflicted punishment and torture in the name of their emperor, believing that they did so through divine instruction. This study reveals how they arrived at this conviction.