The desk lamp in the office stayed on all night.
Lu Shen didn't go home.
He didn't even leave the chair... except for a brief moment at 2 AM when he went to the water dispenser at the end of the hallway to get a cup of warm water. His entire world was reduced to the desk in front of him, a stack of blank paper, and various data.
He wrote slowly.
Because every word of this report had to withstand the most rigorous scrutiny.
It couldn't be like a prophet's prediction; it had to be like an analyst's deduction.
The difference between the two is... a prediction only gives a conclusion, while a deduction provides the process.
A prediction amazes, a deduction convinces.
And what Lu Shen needed was not amazement, but conviction.
He needed a row of irrefutable data soldiers behind every anti-mainstream conclusion.
He needed every link in the logical deduction chain to find a corresponding anchor point in the real world.
He needed anyone with sufficient professional competence to arrive at the same judgment after reading the entire report... that although this analyst's conclusions were contrary to the mainstream, his argumentation process was impeccable, his data sources clean and compliant, and his logical chain seamless.
So he wrote slowly.
After finishing each section, he would stop and review it from the beginning.
He replaced all phrases that might expose prior knowledge, modified all overly certain tones to a cautious deduction tone, and wrapped all conclusions in the safety shell of reasonable extrapolation based on existing data.
Outside the window, the sky turned from pitch black to deep blue, then from deep blue to gray-white.
The skyline across Victoria Harbour began to reveal a vague outline, and the lights on the distant Kowloon Peninsula went out one by one.
At 6:12 AM, Lu Shen put down his pen.
On the desk, twenty-seven pages of handwritten reports were neatly stacked together.
On the cover of the report, he wrote the title in neat English...
"Deep Deduction of Yen Appreciation Trend Post-Plaza Accord and U.S. National Interest Response Strategy"
Signature: Lu Shen, Economic Analysis Group, Hong Kong Station
He picked up the cup of water that had long since cooled and drank it in one gulp.
Then he leaned back in his chair, closed his eyes, and silently reviewed the core structure of the entire report in the darkness.
Four core predictions.
Each with complete data support and logical deduction, each pointing in a direction completely opposite to the market mainstream, each to be verified by reality within the next three to six months.
And all this data foundation came entirely from the latest offshore market transaction records that he, as an economic analyst at Hong Kong Station, could legally access.
Not a single number exceeded his permission range, not a single piece of information required cross-departmental coordination to obtain.
Clean and impeccable.
At 9:30 AM, Lu Shen knocked on the door of the Station Chief's office.
"Come in."
Macallan sat behind a large mahogany desk, holding a coarse ceramic coffee cup with the United States Marine Corps' eagle, globe, and anchor emblem printed on it... reportedly a souvenir from a colleague at the end of his tenure in Beirut.
He lifted his eyelids to glance at Lu Shen, his gaze carrying the usual scrutiny of a seasoned Station Chief towards a subordinate... neither cold nor warm, neither distant nor close.
"What is it?"
Lu Shen closed the door, walked to the desk, and placed the stack of reports on the table with both hands.
"Station Chief, I have an intelligence analysis report I'd like you to review."
Macallan's gaze fell on the report cover, lingering for two seconds.
Then he put down the coffee cup, reached for the report, opened the cover, and glanced at the title.
"Deep Deduction of Yen Appreciation Trend Post-Plaza Accord and U.S. National Interest Response Strategy"
His eyebrows raised slightly.
"The Plaza Accord?" Macallan leaned back in his chair, "The headquarters' Economic Intelligence Division just released a comprehensive assessment on this topic last month, and the conclusion was clear... the yen's appreciation is nearing its end, and the Bank of Japan will intervene by January at the latest. Does your report align with their conclusion?"
"It doesn't." Lu Shen's voice was steady, "Completely the opposite."
Macallan's hand paused as he lifted the coffee cup.
He looked at Lu Shen, his gaze now carrying a bit more inquiry.
A mid-level analyst presenting a report with conclusions completely opposite to those of the headquarters' Economic Intelligence Division... Langley's most authoritative economic analysis department... was not common within the CIA system, as it implied two possibilities: either the analyst had extraordinary insight, or he had extraordinary courage.
And in Macallan's experience, the latter was usually more prevalent than the former.
"Let's hear it." He placed the coffee cup on the coaster, "What are your core points?"
Lu Shen did not sit down... Macallan hadn't invited him to, so he wouldn't.
He stood across the desk, hands naturally at his sides, and succinctly presented the four core predictions of the report.
"Firstly, the exchange rate trend. My judgment is: not only will the yen not retreat at the 200 mark, but it will also firmly hold at 1:200 by December, accelerate past 1:180 in the first quarter of next year, and break through 1:150 by mid-year. The appreciation will far exceed the official range agreed upon in the Plaza Accord, even beyond the Bank of Japan's control."
Macallan's brows furrowed, but he didn't interrupt.
"Secondly, Japan's policy direction. The Bank of Japan will not intervene in the yen's appreciation... quite the opposite, to offset the panic-induced loss expectations of export companies due to drastic exchange rate fluctuations, the Bank of Japan will initiate its first interest rate cut as early as December this year. Throughout next year, it will implement ultra-loose monetary policies, leading to a domestic liquidity overflow, triggering a full-scale stock market and real estate bubble."
Macallan's brows furrowed deeper, his fingers began tapping unconsciously on the desk... a habitual action that Lu Shen noticed.
"Then there's the capital flow. Japan's insurance funds, pensions, trusts, and other long-term institutions, to hedge the shrinking export earnings due to yen appreciation, will start large-scale U.S. Treasury purchases in the first half of next year, quickly making Japan the largest foreign holder of U.S. Treasury bonds.
Simultaneously, Japanese companies will initiate a massive acquisition spree in the U.S. real estate, semiconductor, and automotive manufacturing sectors. This trend will eventually trigger a strong political backlash in the U.S., making a comprehensive U.S.-Japan trade friction inevitable."
"Finally..." Lu Shen paused slightly, his gaze meeting Macallan's eyes, "industrial transfer. The continuous appreciation of the yen will force Japan's low-end manufacturing to massively shift to the Four Asian Tigers regions starting next year.
And Hong Kong, with its unique geographical location and financial infrastructure, will become the sole core transit hub for Japanese capital entering Southeast Asia and the Dragon Nation's mainland. The status of Hong Kong as an offshore financial center will experience at least three years of explosive growth."
He emphasized the last sentence intentionally or unintentionally:
"This means the strategic value of Hong Kong Station in the East Asian economic intelligence system will undergo a qualitative leap." Find the original chapter at g.com.
The office fell silent for a moment.
Macallan didn't respond immediately.
He picked up the report, opened the first page, scanned a few lines, then flipped to the middle, then to the back.
His reading speed was fast, clearly not reading carefully, but assessing the "weight" of the report... a veteran in the intelligence system, with just a few glances, could tell whether a report was substantial or just sensational.
Then he flipped back to the first page, this time slowing down.
Lu Shen stood across, motionless.
Macallan read for fifteen minutes.
During those fifteen minutes, his expression underwent three distinct changes.
The first change occurred when he finished reading the data support section of the first prediction.
In this section, Lu Shen cited the latest Hong Kong offshore yen forward contract trading data.
He used a hand-drawn chart to show the changes in the holding structure of three-month and six-month yen forward contracts over the past six weeks... the long positions on the yen not only didn't see the expected profit-taking at the 200 mark but were actually accelerating.
Meanwhile, the hedging contracts of Japanese export companies exhibited an extremely abnormal characteristic: their hedging coverage period was rapidly extending from the usual three months to six to nine months, and the hedging execution prices were far below the current exchange rate levels.
"The financial departments of Japanese export companies... these nerve endings closest to the blood vessels of the real economy... are voting with real money for a judgment: the yen's appreciation is far from over. They don't believe 200 is the top, they don't even believe 180 is the top. They are preparing for a more extreme appreciation scenario."
When Macallan read this, his body, originally leaning back in the chair, unconsciously leaned forward a few degrees.
His fingers stopped tapping.
The second change occurred when he finished reading the second prediction.
In this section, Lu Shen cited a set of data severely overlooked by the market... the cross-border investment filing records of Japanese insurance companies through the Hong Kong offshore market in the first two weeks of November.
These filing records showed that three top Japanese insurance institutions had submitted dollar asset allocation applications totaling over four billion dollars in the past two weeks, with investment targets focused on U.S. Treasury bonds and U.S. real estate funds.
"These insurance institutions are the most conservative long-term funds in Japan, and their investment decision cycles are usually measured in quarters or even years. When they submit such large-scale dollar asset allocation applications within two weeks, there's only one reasonable explanation... their actuarial models have already incorporated the continuous and significant appreciation of the yen as a baseline scenario.
They are not chasing the rise, but hedging. And the 'risk' they are hedging against is precisely the scenario that the headquarters' Economic Intelligence Division believes will not happen."
When Macallan finished this page, he slowly removed his glasses.
He looked up at Lu Shen, and that gaze was completely different from fifteen minutes ago... no longer the routine scrutiny, but a sharp reevaluation.
The third change occurred when he read the last part of the report... the additional national interest response plan.
In this section, Lu Shen used four pages to systematically elaborate on the operational strategies that the White House and the Federal Reserve could directly implement: how to leverage the yen's appreciation trend to guide Japan's long-term funds to massively take over U.S. Treasury bonds, thereby lowering U.S. long-term interest rates and supporting the Reagan Administration's fiscal deficit financing needs;
How to preemptively set foreign investment barriers in key industries before Japanese companies' acquisition spree in the U.S. fully unfolds, ensuring the technological security of core fields like semiconductors and defense; how to use the political window of escalating U.S.-Japan trade friction to renegotiate trade terms with Japan, converting the exchange rate achievements of the Plaza Accord into more enduring trade structure advantages.
Each strategy was not an empty directional suggestion but an executable plan with clear timelines, operational paths, and expected outcomes.
When Macallan closed the last page of the report, his expression was no longer just one of shock.
What couldn't be hidden on his face was the unique, extremely restrained excitement of a seasoned intelligence officer suddenly realizing he held a powerful weapon in his hands!