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24 November 1997: Yamaichi Securities collapses

Yamaichi Securities, one of Japan's four big brokerage houses and a century-old institution, announced it was shutting down after revelations of hidden losses. Its president wept at a televised news conference, apologizing to employees. The failure, Japan's biggest corporate collapse since the war at the time, crystallized the end of the bubble-era illusion that big Japanese financial firms could not fail.

The lesson: No institution is too old or too prestigious to fail if it hides losses.

What it meant for investors

$1,000 in Nikkei 225 at the start of 2000 → $2,632 today, vs $4,626 in the S&P 500.

We start the clock at the start of 2000, the first year in our price data after the event. That is 2.6 times the money, but $1,994 less than a plain index fund made over the same years.

What Nikkei 225 teaches: Even a large developed market can fail to reach its old peak for a generation, which is why buying at bubble valuations is dangerous for patient investors too.

Bought inPrice thenWorth todayS&P 500 would be
2000$19,000$2,632$4,626
2003$8,600$5,814$7,727
2005$11,500$4,348$5,763

green = beat the S&P 500 · red = lost money

What if you bought Nikkei 225? Every starting year and the full story →

24 November 1997: Yamaichi Securities collapses