21 September 1931: Britain leaves the gold standard
Facing a run on its gold reserves and a deepening depression, Britain suspended the pound's convertibility into gold. The pound fell sharply against the dollar. It was a shock for the country that had long anchored the world's financial system. Yet leaving gold freed Britain to lower interest rates and recover earlier than countries that clung to the gold standard, like the United States.
The lesson: Sticking to a rigid policy in a crisis can do more harm than abandoning it gracefully.
What it meant for investors
$1,000 in FTSE 100 at the start of 1990 → $4,042 today, vs $19,429 in the S&P 500.
We start the clock at the start of 1990, the first year in our price data after the event. That is 4.0 times the money, but $15,387 less than a plain index fund made over the same years.
What FTSE 100 teaches: When an index pays high dividends, its price chart tells only half the story, and comparing price indices across countries can mislead badly.
| Bought in | Price then | Worth today | S&P 500 would be |
|---|---|---|---|
| 1990 | $2,400 | $4,042 | $19,429 |
| 1995 | $3,100 | $3,129 | $14,783 |
| 2000 | $6,900 | $1,406 | $4,626 |
green = beat the S&P 500 · red = lost money
What if you bought FTSE 100? Every starting year and the full story →
More FTSE 100 history
- 24 June 2016: Britain votes for Brexit and markets panic
- 7 July 2005: London bombings, and a market that held its nerve
- 14 September 2007: Northern Rock triggers Britain's first bank run in generations
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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