Hello there,
Let’s start with a thought experiment.
Imagine you invested $1,000, and then watched the world fall apart. Not once, not twice, but over and over again.
Wars breaking out across continents, economies collapsing, pandemics spreading, headlines filled with fear, uncertainty, and predictions of “this time, it’s different.”
Now imagine doing nothing, no panic selling, no reacting to the noise. Just staying invested through it all, because over the last 100 years, that’s exactly what the data shows.
Between 1925 and 2025, the world endured roughly 170 wars. Two world wars that redrew global power. Multiple financial crashes that erased trillions overnight. Oil shocks, currency crises, political instability, and decades of tension kept the world on edge.
At several points, it looked like the system itself might not survive.
And yet, quietly, consistently, almost stubbornly, the market kept going higher.
That same $1,000 invested in 1925, with dividends reinvested, would be worth in the region of $10 million today.
Not because the world was stable, but because, over time, progress outweighed panic.
Pause there for a moment, because this isn’t just a story about markets. It’s a story about what happens when you stay invested in growth, while the world is busy reacting to fear.
❝The market has never recorded a negative return over any rolling 30-year period in its history. Not through any war. Not through any crash. Not through any crisis. ❞
This is not a story about stock tips. It is a story about what patience, perspective, and the structure of capitalism have delivered to those who stayed in the game even when the world appeared to be falling apart around them.
As someone who has spent 30+ years in institutional finance, I want to walk you
through what a century of data actually shows us, because understanding the past
is the most powerful tool you have for building wealth in the future.
DEFINING WAR: WHY THE THRESHOLD MATTERS
Before we count wars, we must define them. This matters more than most people
realise because how you define war determines what you count, and what you count
shapes how you see the world’s risk landscape. The definition I use: an organised, sustained armed conflict between two or more parties, whether states, non-state actors, or internal factions, resulting in at least 1,000 battle-related deaths per year of active fighting.
This is the threshold used by the Correlates of War (COW) Project at the University of Michigan and the Uppsala Conflict Data Program (UCDP) in Sweden, the two most academically rigorous frameworks in conflict research.
Under this definition, we include interstate wars, civil wars, wars of independence, and proxy wars. We exclude low-level insurgencies, massacres without organised armed resistance, terrorism campaigns, and genocides where one side cannot mount a sustained military response.
This threshold matters because markets respond to the scale, duration, and
geopolitical consequences of conflict, not to its mere existence. A skirmish that
kills 200 people is a tragedy. A war that kills 100,000 per year restructures global trade, energy supply chains, currency reserves, and investor behaviour. The 1,000-death threshold captures that distinction.
100 YEARS, 170 WARS
Using this definition, the world witnessed approximately 170 distinct armed conflicts between 1925 and 2025. That is an average of 1.7 new wars starting every single year for a full century. In practical terms, the world has been at war somewhere in virtually every month of the last 100 years.
The weighted average conflict duration was 4.5 years, though the median was just 1.5 years. Angola burned for 27 years, Afghanistan for 40+, and Colombia’s FARC insurgency for 52 outliers that conceal the fact that roughly 60% of wars conclude within 3 years.
Conflict peaked in the 1985–94 decade at 28 wars, combining Cold War proxy conflicts with post-Soviet fragmentation. The deadliest decade was 1935–44 with 22 conflicts killing an estimated 70–85 million people, roughly 3% of the global population. The Rwanda genocide alone killed ~800,000 in 100 days, a rate exceeding even the Holocaust in velocity.
By type, 55% of all conflicts were civil wars, 20% interstate, 15% independence/colonial, and 10% internationalized civil wars. The war most likely to affect any country is an internal one.
❝Civil wars dominate global conflict at 55%. The war you fear is usually not the war that actually happens. ❞
WHAT THE MARKET ACTUALLY DID
Here is where the story gets remarkable and profoundly counterintuitive.
The Dow Jones Industrial Average (DJIA) opened 1925 at approximately 156 points. As of early 2025, it trades near 42,000. That is a price-only return of approximately
26,800% over 100 years or roughly 5.6% per year compounded, before dividends.
But price return alone dramatically understates the real story. Dividends historically contributed an additional 3.8 to 4.2 percentage points of annual return. Add those back in with reinvestment, and the 100-year total return rises to approximately 9.5 to 10.2% per year, meaning that every dollar invested in 1925, left entirely untouched, multiplied by a factor of between 8,300 and 13,500. At a 9.8% annualised rate, the academic consensus figure is that $1,000 in 1925 becomes approximately $10 million in 2025. At 11%, it reaches $18.8 million.
The journey was not smooth. The DJIA crashed from 381 in September 1929 to 41 in July 1932, an 89% collapse that remains the deepest in recorded US market history. It took 25 years, until 1954, for the index to reclaim its 1929 peak.
From 192 in 1945, the market reached 969 by 1965, a 405% gain in 20 years as
the post-war economic miracle delivered the longest peacetime expansion in American history to that point. The oil shock of 1973–74 dragged the index back
to 616 by late 1974, a 36% decline from the 1965 high. Then came the Reagan bull
market: from 964 in 1980, the DJIA rose 1,006% to reach 10,787 by 2000.
The dot-com bust cut 38% between 2000 and 2002. The Global Financial Crisis of
2008–09 delivered a 54% peak-to-trough decline. COVID-19 in March 2020 produced a 34% collapse in just 33 calendar days, the fastest bear market in history.
In each case, the market reached a new all-time high within months or years. In the case of COVID, recovery took just 5 months.
The power of time on invested capital compounds non-linearly. An investor who
put $10,000 into a DJIA-tracking instrument in 1965 and held for 60 years would
have approximately $3.8 million today at a 9.8% annual return. The same $10,000
invested in 1985, 20 years later yields approximately $640,000. The cost of those 20 years of delay is $3.16 million, not in some abstract future, but in real wealth that could have existed. That 20-year delay cost 83% of the outcome. That is the arithmetic of time.
❝$1,000 in 1925. ~$10 million today. The market did not achieve this by avoiding war. It achieved it by outlasting every war.❞
HOW THE MARKET PERFORMED DURING SPECIFIC WARS
This is the data point that surprises people most consistently. Markets are
supposed to crater during war. The evidence says otherwise.
During World War II (1939–45), the DJIA returned +46%, driven by the largest industrial mobilisation in American history. US manufacturing output rose 300%
between 1939 and 1944, with 40% of all GDP redirected to war production by 1943.
During the Korean War (1950–53), the DJIA returned +20% as the post-WWII economic momentum continued, and defence spending added a further fiscal stimulus layer.
During the Gulf War (1990–91), a conflict that lasted just 7 months, with a clearly defined geopolitical objective, the DJIA returned +20% as rapid resolution removed uncertainty and markets almost always prefer a resolved bad outcome to a prolonged uncertain one.
During the Afghanistan and Iraq wars (2001–11), the DJIA returned +11% across the
decade, aided by recovery from the dot-com bust and sustained defence-sector earnings growth. During the Russia-Ukraine war (2022 to present), the DJIA has
returned approximately +17%, as the AI investment boom and post-COVID earnings
growth more than offset energy market disruption and geopolitical anxiety.
The single exception is the Vietnam War period (1965–75), where the DJIA returned
-12%. But the cause is largely misattributed. The primary drivers of that decade’s
negative equity returns were not the war itself, but the 1971 Nixon shock, the unilateral abolition of the Bretton Woods gold standard, which triggered a 10-year
currency crisis and the 1973 Arab oil embargo, which caused oil prices to spike
400% in under six months, generating double-digit inflation that the Federal Reserve was structurally slow to control. War was the backdrop. Monetary and energy policy were the culprits.
The net result across all six major war periods in the dataset: 5 out of 6 produced positive DJIA returns. That is an 83% hit rate for positive market performance during major armed conflict. This does not make war economically desirable, but it does make the “flee to cash at the first sign of conflict” instinct statistically unjustifiable.
❝83% of major war periods in the last 100 years produced positive stock market returns. Fear, not war, is the real portfolio killer.❞
MARKET RECOVERIES: HOW LONG DID IT ACTUALLY TAKE?
Every major crash in the 100-year dataset recovered to a new all-time high. Every single one. The question was never whether, only when.
The Great Depression (1929–32) fell 89% and took 25 years to recover. The 1937 WWII bear market fell 49%, recovering in 8 years. The 1973–74 oil shock fell 45% in 7 years. Black Monday (1987) collapsed 22% in a single session, the largest single-day drop in Dow history, yet recovered in under 2 years. The dot-com bust (2000–02) fell 38%, recovering in 6 years. The 2008–09 financial crisis fell 54%, the second worst on record, and recovered in 5 years. COVID-19 fell 34% in just 33 days and recovered in 5 months.
Recovery times are shortening. The 25-year Great Depression recovery reflected near-total policy failure: Smoot-Hawley tariffs collapsed global trade by 66%, the Fed raised rates into the recession, and ~9,000 bank failures wiped out one-third of all deposits with no insurance backstop. COVID, by contrast, saw the Fed expand its balance sheet by $3 trillion in 8 weeks and $2.2 trillion in fiscal stimulus deployed within 30 days of the market bottom.
The 100-year lesson: the average peak-to-trough decline across all seven crashes was 49%, with an average recovery of 7.4 years. The investor who stayed invested through all seven crises captured the full 26,800% price return. Those who exited and re-entered after recovery missed an estimated 60–70% of total long-run returns because the sharpest gains come in the earliest weeks after a bottom, precisely when fear is highest.
WHAT THIS MEANS FOR WEALTH BUILDERS
I want to speak directly now, not to an abstract investor, but to the first-generation wealth builder. To the person who grew up watching instability and learned to distrust systems. To the Nigerian who watched the naira depreciate by over 99% against the dollar between 1985 and 2024, from ₦1 to the dollar to over ₦1,600. To the immigrant who keeps savings in cash because at least that feels real.
Your instinct to distrust is rational. It was built on lived experience. But it may be costing you generational wealth on a scale that is almost impossible to articulate.
Consider this: the Nigerian who converted $1,000 into naira in 1985 and kept it
in a savings account protecting it from “risky” markets effectively watched its dollar-equivalent value fall from $1,000 to under $1 over 40 years. That is a 99%+ real-terms destruction of purchasing power. Meanwhile, the same $1,000 invested in a simple S&P 500 index fund in 1985 is worth approximately $64,000 today, a 6,300% return.
This is not an argument against Nigeria, or against your home country, or against
your culture of financial caution. It is an argument for understanding the mechanics of where value is stored, and what time does to money in different vehicles.
The US equity market, for all its imperfections, all its volatility, all its moments of apparent collapse, has returned approximately 9.8% per year for 100 years. If you started investing $500 per month into a broad US market index fund at age 25, you would accumulate approximately $3.4 million by age 65, assuming that 9.8% historical average. Start at 35 instead, and that figure falls to $1.2 million, a $2.2 million penalty for a 10-year delay. Start at 45, and it falls to $388,000. The cost of each decade of delay is not linear. It is exponential. And it is permanent.
❝The greatest financial risk facing the diaspora investor is not war, recession, or inflation. It is the compounding cost of not being invested during the recovery. ❞
THE SEVEN LESSONS OF A CENTURY
- Wars are more common than we think. 170 in 100 years means the world has averaged 1.7 new conflicts per year, every year, for a full century. Yet civilisation and capital markets have endured. The world does not end. It adapts.
- Civil wars dominate at 55% of all conflicts. The conflict most likely to affect your country is internal, not an invasion. Understand this when assessing political risk in your portfolio and in your decisions about which markets to trust.
- 83% of major war periods produced positive equity returns. Counter-intuitively, war spending is often economically stimulative in the short to medium term. Defence production, infrastructure rebuilding, supply chain diversification, and the resolution of geopolitical uncertainty all create corporate earnings. Fear is usually the wrong market signal.
- All seven major crashes have fully recovered, every single one. The average recovery time is 7.4 years. The longest was 25 years (Great Depression, a policy failure, not a market failure). The shortest was 5 months (COVID). The 100% recovery rate across all crashes is not a guarantee of the future. But it is the most consistent pattern in modern financial history.
- Time is the multiplier, not intelligence. $1,000 in 1925 is worth ~$10 million today because of compound time, not genius. A 20-year delay in starting costs approximately 83% of final wealth at a 9.8% return rate. The best financial decision available to any person under 40 reading this is to start now. Not when the market is calmer. Not after the next election. Now.
- Missing the best days is catastrophically expensive. Research from JP Morgan Asset Management shows that if you missed the 10 best trading days of the S&P 500 in any given 20-year period, your returns were cut by approximately 50%. If you missed the 20 best days, returns fell by roughly 67%. The majority of those best days occurred within 2 weeks of the worst days. Being out of the market during the panic means being out during the recovery.
- Diversification is engineering, not cowardice. You do not need to predict which country, sector, or asset class will lead. You need systematic exposure to the broad engine of human productive capacity, maintained consistently over time, regardless of the news cycle. A globally diversified index portfolio costing as little as 0.03% in annual fees with modern instruments gives you ownership of that engine. The more I learn, the more I discover how little I know.
But one thing 100 years of data makes unmistakably clear: the world is always worth investing in.
Until next time
Dr. Mayowa Olusoji
Your Financial Literacy Plug |30+ Years of Financial Intelligence. Simplified for You.
