Compound interest can make beads worth more than Manhattan—turns out the Indians weren't ripped off after all

Although it seems like Native Americans got a bad deal on more than one occasion when dealing with European settlers and explorers, that wasn't always the case. One example is where the natives sold an island, today known as Manhattan, for some beads and trinkets worth roughly $16.

Today, Manhattan has some of the most expensive land on the planet! Due in part to the Upper East Side, it has the largest concentration of extreme wealth in all of the United States.

Though the ancestors of the early colonists might be happy their forefathers made that trade, that $16 would be worth much, much more than all of Manhattan now if it had been put in a bank!

Using the land value of Central Park, Jeffrey Strain estimated Manhattan to be worth about $8 trillion. The land purchase happened in 1626, so if the $16 compounded monthly at 8%, the beads would be worth over $200 trillion—more than the entire island of Manhattan.

(Source)