The Roaring Twenties: How a Single Decade Re-Engineered the American Century
A decade of abrupt transition and technology for the masses
Open Frederick Lewis Allen’s classic Only Yesterday, and you enter the United States’ first great age of disruption.
Between 1920 and 1929, the nation balanced precariously between rural tradition and urban modernity, accelerating from horse-drawn wagons to coast-to-coast radio broadcasts with scarcely a pause.
The parallels with our own digitally networked era are striking—and instructive.
Culture in Overdrive
Before the First World War, most Americans inhabited small towns and agricultural communities. By mid-decade, however, metropolitan energy dominated public life.
Radio sets crackled in living rooms from Maine to California, binding disparate regions into a single cultural marketplace.
Hollywood, meanwhile, exported new ideals of fashion and behaviour. Flappers—icons of liberated youth—challenged Victorian social codes.
Advertising magnified these shifts. Madison Avenue executives no longer sold only soap or cigarettes. They sold a dream.
The celebrated billboard proclaiming “It’s Always Summer in Miami” helped ignite the Florida land boom. Mere persuasive imagery could redirect capital across a continent.
The decade’s contradictions were equally dramatic. Prohibition criminalised alcohol yet catalysed organised crime.
Jazz flourished in Harlem nightspots.
The Scopes “Monkey Trial” exposed enduring tensions between scientific inquiry and religious orthodoxy.
Technology for the Masses
Technological progress was explosive.
Collectively, these innovations narrowed geographic distance and heightened consumer expectations. They also created fertile soil for financial speculation.
Wall Street’s Exhilarating—and Fatal—Ascent
By 1928, ticker-tape quotations were as familiar to the public as baseball scores.
Radio Corporation of America (RCA) became the age’s emblematic growth stock. Its price levitated on projections of boundless demand.
Margin accounts allowed small investors to control large blocks of shares with minimal cash. It magnified both gains and eventual losses.
Fortunes were both made and lost.
Joseph P. Kennedy liquidated his holdings early and preserved his fortune.
Yale economist Irving Fisher proclaimed stocks had reached a “permanently high plateau” mere weeks before the crash. He went bankrupt.
Their divergent fates illustrate the difference between prudent scepticism and unbridled optimism. It’s a lesson as relevant to modern investors as to their predecessors.
Enduring Lessons
The 1920s codified a template that has repeated across subsequent booms:
Technological breakthrough captures the imagination.
Easy credit amplifies asset prices.
Narrative momentum supersedes fundamental analysis.
Reversion to economic reality brings precipitous decline.
Recognising this sequence is among the most important mental models of investing.
Conclusion
In a short ten years, the United States rewrote its cultural script, redrew its economic map, and redefined the scope of individual ambition.
Much of what we regard as modern life—from 24-hour media cycles to the democratization of speculation—was forged amid the jazz riffs and skyscraper shadows of that brief, incandescent era.
When today’s commentators insist “this time is different,” a sober reading of Only Yesterday provides an invaluable counterpoint.
History may not repeat verbatim, but markets maintain a familiar rhythm. The Roaring Twenties remain the introductory movement of America’s modern symphony.