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 in | Price then | Worth today | S&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 →
More Nikkei 225 history
- 29 January 2016: The Bank of Japan goes negative
- 11 March 2011: Japan's earthquake and tsunami
- 22 September 1985: The Plaza Accord takes down the dollar
- 17 November 1997: A major Japanese bank collapses
- 29 December 1989: The Nikkei hits its all-time bubble peak
Could you have called it at the time? The wheel picks the year, you pick the position, ten seconds a pick.
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