Chapter 30: Crisis Erupts

The next morning, George was still eating breakfast at home when the phone rang urgently. He walked over and picked up the receiver. Paul's voice came through on the other end.

"Boss, news from the exchange—the market is crashing, and many stocks are plummeting. The agricultural-related stock futures you asked me to monitor are being hit the hardest. What should we do next?"

George responded calmly, "Alright, I understand. First, finalize the contract with Lockheed Corporation and get it signed as soon as possible. I'll let you know what to do afterward. I'll be at the exhibition later—if you need me, come find me there."

"Okay, Boss. I'll arrange everything immediately." With that, the call ended.

At the exhibition entrance, George noticed that the crowd had thinned significantly. Few people were walking around leisurely; only the basic exhibitor staff remained. Despite the sparse attendance, he still overheard people discussing the market crash, and fortunately, a few were joking about staying out of the stock market.

George figured that the people still present likely had no stake in the market. Those involved in trading would've rushed off the moment they heard the news. They wouldn't have the mind to linger at an exhibition.

As he walked around again, George noticed Boeing's booth was also being dismantled. It seemed they were preparing to leave early. He didn't approach them for details—he was hoping Boeing would call him instead.

Smiling, he shook his head. The stock market wasn't for the average person. If he hadn't known the future trends, he wouldn't have dared to get involved either. He returned to his company's booth and asked the service staff to bring him a cup of coffee. As he sipped, he quietly contemplated what would come next.

It wasn't until nearly noon that Paul arrived at the reception room with the Lockheed brothers, John, and a lawyer.

George offered everyone a cup of coffee, then took the contract from Paul and reviewed it carefully.

At that moment, the Lockheed brothers appeared visibly relieved. They were already aware of the market turmoil and fully understood the devastating impact an economic crisis could have on them.

Finding no issues with the contract, the group signed it on the spot. George immediately issued a cashier's check for $150,000. Then, in front of the Lockheed brothers, he gave Paul a check for $500,000 and instructed him to inject the funds into the company account, ensuring a clear separation between corporate and personal finances. He also scheduled a visit to Lockheed Corporation in two days to complete the formalities and address overdue wages and R&D funding.

At noon, the group shared lunch, celebrating the Lockheed brothers officially joining the company. During the meal, the brothers showed great interest in George's car, which stood out from anything currently on the market, from startup mechanics to interior design.

They also began discussing how battery technology might be integrated with aircraft manufacturing, engaging George in a deep and enthusiastic exchange of ideas.

After settling matters with the Lockheed brothers, George instructed Paul to gather information on leading companies currently producing hair dryers, electric fans, refrigerators, and washing machines. He wanted detailed information on the top players in each sector.

It seemed that today would be the last day of the exhibition. This year's event was wrapping up in a hurry. George didn't stay long. He asked Paul to send the energy storage battery back to the villa once the exhibition closed, and then he returned home.

That evening, George sat in the study, gazing at a wine glass on the table, reflecting on the origins of the ongoing economic crisis in the United States.

During World War I, the U.S. claimed neutrality, but in reality, it relied heavily on military orders from the Allied Powers—such as Britain and France—to resolve issues related to market saturation, employment, and finance. This fostered an unsustainable boom in the American economy, which manifested in several key ways:

First, industrial production surged. Sectors tied to wartime needs—like steel and petroleum—boomed. From 1913 to 1918, the industrial production index rose from 199 to 254, a 30% increase.

Second, agriculture flourished. Industrial growth expanded demand for agricultural products, and prices rose accordingly. Between 1914 and 1919, the agricultural production index increased from 100 to 105, and total income from agriculture jumped from $7.6 billion to $17.7 billion.

Third, national wealth soared. Industrial and agricultural growth, along with booming exports, swelled the U.S. national income from $31.2 billion in 1914 to $57 billion in 1918. Per capita GNP rose from $1,317 to $1,401.

However, once wartime demand evaporated, the economy's underlying instability emerged, triggering a massive economic downturn. This was essentially a crisis of overproduction.

Industry was hit first:

Industrial production collapsed. With the war over, foreign military orders dried up. Sectors like coal, steel, and automobiles suffered severe cutbacks. Exports fell, and demand plunged. In 1921, the industrial production index declined by over 32% from 1920. Steel output dropped 74%, and the production of machine tools, locomotives, and freight cars declined by more than 90%.

Corporate bankruptcies soared. In 1921, bankruptcies more than doubled compared to 1919. Bank failures increased sixfold.

Unemployment skyrocketed. By autumn 1921, 5.75 million Americans were jobless. The unemployment rate jumped from 7% in 1920 to 23% in 1921. Real wages dropped below 1900 levels.

The crisis was compounded by agriculture's collapse:

Agricultural overproduction and falling prices. In 1921, the wholesale price index for farm goods fell by over 41% from 1920. Some key products saw a 60% price decline, slashing farmers' incomes.

Price scissors widened. Industrial prices dropped more slowly—or not at all—compared to plummeting agricultural prices, worsening rural hardship.

Widespread bankruptcies of small and medium-sized farms. In June 1920, the government stopped purchasing wheat and canceled agricultural contracts, leading to inventory gluts and plummeting revenues. Many farms went bankrupt, agricultural unemployment rose, and the agricultural production index dropped by 11%.

The combination of industrial and agricultural collapse pushed the U.S. into a chronic economic crisis. It wasn't until 1921 that recovery began, ushering in a period of relative stability throughout the 1920s.

This period brought both opportunity and risk. George's strategic entry into wheat futures, just before the government halted its purchasing program, was a masterstroke. As the crisis unfolded, he also planned to seize the chance to acquire valuable assets at depressed prices.

The following day, Paul and his team left New York for Santa Barbara, California, to manage company operations there. George had instructed them to retain only essential staff and temporarily lay off anyone willing.

If George managed to acquire Boeing, he planned to unify and merge the two companies.

The next day, he had the family driver purchase various household appliances and tools. Then he began working on home appliance innovations.

George had just completed a redesigned agitator washing machine. His improvement featured a vertical shaft in the drum's center, with an agitator wing at its lower end. The motor would drive the shaft in periodic forward and reverse oscillations, causing clothes to tumble and rub against each other to remove dirt.

He also designed a spin-drying function based on centrifugal force—by drilling small holes in the drum and spinning it at high speed, excess water would be expelled.

Just as he prepared to build a prototype, George realized that while plastic had already been invented, injection molding machines were still quite primitive.

In 1868, Hyatt developed a plastic called Celluloid, based on Alexander Parkes's 1851 invention. Hyatt and his brother Isaiah patented a plunger-type injection molding machine in 1872. The design resembled a giant syringe, injecting heated plastic into a mold.

George recalled seeing second-generation mechanical injection molding machines at expos in his previous life. With plastics becoming essential for modern appliances—washing machines, air conditioners, hair dryers—he needed a more advanced solution.

After finalizing and filing the washing machine patents, George immediately began designing an injection molding machine.

The concept was simple: a screw or plunger injects molten plastic into a sealed mold. Once it cools and solidifies, the finished product is removed. Depending on the layout, injection molding machines can be vertical, horizontal, or hybrid.

George's first design used a horizontal structure, powered by air pressure for injection, though clamping still required manual operation.

Each injection cycle included steps like measured feeding, plasticization, pressure injection, mold cooling, mold opening, and part removal. Despite appearing straightforward, real-world operation involved many variables—temperature control, pressure calibration, feeding timing, and part ejection. Any misstep would ruin the process.

Still, plastic's vast range of applications made it indispensable in industrial development.

Once George finished the patent drawings and documentation, he planned for Paul to file the patent and locate a mechanical workshop to fabricate a prototype.

Just then, George received a phone call from Vito Corleone.

"Hello, Mr. Corleone."

"Hello, George. Just call me Vito. All my friends do."

"Alright, Vito. Is there news about what I asked you to look into?"

"Yes. Luciano, the Jewish Gang's Godfather, wants to meet you in Reno to discuss the matter further."

"Do I have to meet him in person? Alright. Tell him I'll head there as soon as I can. Thanks, Vito."

"You're welcome. We're friends, right?"

"Of course."

They chatted briefly, then ended the call.

During a past visit to Corleone, George had learned that this world's underworld wasn't exactly like in The Godfather movie. While the Five Families existed—Corleone, Basini, Tattaglia, Stracci, and Cuneo—they were only part of a larger picture. Other powerful groups like the Irish Gang, Black Legion, Asian gangs, and the Jewish Gang also operated, forming a body known as the Underground Commission. The Five Families were simply the top tier.

The Jewish Gang was one of the five major powers. George wasn't sure what they wanted to discuss, but knowing their reputation, he doubted the meeting would be smooth. Still, when it came to force, George wasn't concerned.

—End of Chapter 30—

Translator's Note:

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