16 September 1992: Black Wednesday sees sterling crash out of the ERM

On this day in 1992 – 'Black Wednesday' – the value of the pound crashed as currency speculators sold, dumping sterling out of the European Exchange-Rate Mechanism

Evening Standard with a headline on the ERM crisis
(Image credit: © In Pictures Ltd./Corbis via Getty Images)

Before the euro, there was the ERM – the European Exchange-Rate Mechanism – created in 1979 as a precursor to full European monetary union, and which tied member-currencies' values to that of the deutsche mark.

The UK entered the ERM in 1990, hoping it would help us achieve a German-style economy, characterised by stability and low inflation. But, as Greece, Portugal, Spain, Italy and others could tell you, what's good for Germany isn't necessarily good for anyone else.

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Ben Judge

Ben studied modern languages at London University's Queen Mary College. After dabbling unhappily in local government finance for a while, he went to work for The Scotsman newspaper in Edinburgh. The launch of the paper's website, scotsman.com, in the early years of the dotcom craze, saw Ben move online to manage the Business and Motors channels before becoming deputy editor with responsibility for all aspects of online production for The Scotsman, Scotland on Sunday and the Edinburgh Evening News websites, along with the papers' Edinburgh Festivals website.

Ben joined MoneyWeek as website editor in 2008, just as the Great Financial Crisis was brewing. He has written extensively for the website and magazine, with a particular emphasis on alternative finance and fintech, including blockchain and bitcoin. 

As an early adopter of bitcoin, Ben bought when the price was under $200, but went on to spend it all on foolish fripperies.