The 16th of September 1992 will go down in infamy as the day intervention failed and the British government lost control. By the end of Black Wednesday, George Soros had made a billion dollars and the UK Treasury, Bank of England had blown through taxpayer money in a manner never before seen.
"We planned to intervene on a scale that would ensure the market knew we were intervening, " but as the government intervened one trader notes, "it was incredible, you could hear wave after wave of selling being met by resistance from the Bank of England."
As the Treasury waited for news, fear began to spread, "we waited minute by minute on updates from the market and then we learned that the billion or so [of taxpayer money] we had put aside Tuesday to defend the pound up to the weekend had gone in a few minutes on Wednesday morning," shattering the myth of government omnipotence.
Ironically the recent collapse in the Ruble is significantly worse than the collapse in the pound at the time...
Full BBC Black Wednesday documentary: