Echoes of the Roaring Twenties: Parallels Between the 1920s and Today

Thoughts on the Market
October 25, 2025

History, as Mark Twain once quipped, may not repeat itself, but it often rhymes. The 1920s—known as the Roaring Twenties—was a decade of profound social, economic, and technological change. A century later, the 2020s are unfolding with uncanny similarities. From cultural upheaval to market euphoria, the echoes of the past reverberate through our present in ways that are both fascinating and cautionary.

Ever since I began trading in the 1980s, I’ve immersed myself in the study of cycles and market behavior, searching, like many others, for the “holy grail” of forecasting major moves before they occur. At one point, I even hired an astrologer to add yet another layer of nuance to my analysis. While I no longer consult the stars, I continue to study long-term patterns—demographics, debt, and innovation cycles—to gain perspective on where markets may be headed.

I haven’t found a crystal ball, but I’ve learned to pay close attention to moments of synchronicity, when seemingly unrelated events align in meaningful ways. These convergences often signal inflection points, when multiple trends shift direction all at once.

Today, the similarities between the 1920s and 2020s are particularly striking. From pandemic recovery to market surges and cultural reinvention, the parallels are too pronounced to ignore. Here is what I see:

Comparing Two Booms: 1920s vs. 2020s

Post–Spanish Flu to 1929 Crash

• The Spanish flu pandemic ended around 1920.
• At that time, the Dow Jones Industrial Average rose from roughly 70 in 1920 to 381 by September 1929—a gain of more than 440%.
• This boom was fueled by:
  • Rapid industrial expansion
  • Consumer credit growth
  • Speculative investing and margin buying

Post-COVID to October 2025

• The COVID-19 market bottom occurred in March 2020, when the S&P 500 hit a low near 2,237.
• As of October 2025, it trades above 6,800—more than tripling in five years.
• The rally has been driven by:
  • Massive fiscal and monetary stimulus
  • Accelerated adoption of digital technologies
  • AI and semiconductor dominance
  • Strong corporate earnings recovery
• Investor enthusiasm for leveraged ETFs and retail trading platforms like Robinhood and Webull mirror the speculative mania of a century ago.

What the Comparison Reveals

• Both eras experienced explosive market growth following global crises:
  • The 1920s boom was more speculative and less regulated;
  • Today’s is more tech-driven and institutionally supported.
• Each era reflects the optimism—and fragility—of rapid economic transformation.

Cultural Shifts and Social Tensions

Both decades were defined by sweeping cultural transformation.

In the 1920s, jazz, flappers, and the Harlem Renaissance symbolized freedom and defiance of old norms. In the 2020s, social media, streaming platforms, and digital influencers play similar roles by reshaping expression and identity.

The underlying dynamic is the same: new technologies democratize culture, while generational divides widen.

• The 1920s saw clashes between modernists and traditionalists; today we face similar polarization between progressive and conservative ideologies.
• Debates over immigration, race, and gender—central in the 1920s—remain defining issues in the 2020s.

Economic Boom and Looming Fragility

The 1920s embodied exuberance: stock speculation, easy credit, and mass consumerism. The early 2020s have demonstrated similar exuberant energy, through tech-driven prosperity, crypto speculation, and unprecedented fiscal stimulus.

Both eras followed devastating pandemics, and both were fueled by aspirational consumerism: the desire to embrace new lifestyles and technologies.

Yet the lesson of 1929 – that unchecked optimism often precedes collapse -- looms large: Today’s high valuations, inflation, and debt accumulation suggest the same fragility beneath the surface of prosperity.

Technological Innovation and Disruption

The 1920s introduced technologies that revolutionized communication and mobility, such as the radio, automobile, and cinema. The 2020s are similarly defined by seismic advances in communication and mobility, such as artificial intelligence, electric vehicles, and virtual reality.

Each wave of innovation has:

• Reshaped how people live and work
• Created enormous wealth -- and new inequalities
• Triggered fears of displacement and obsolescence

The pace of technological change may differ from one era to another, but the societal tension it creates is timeless.

Political Polarization and Populism

Both centuries’ twenties have been marked by deep political divides.

The 1920s saw nativism, isolationism, and populist backlash. Today, similar dynamics have resurfaced: nationalism, skepticism toward globalization, and populist leaders on both ends of the spectrum.

Key parallels include:

• Rising distrust of institutions and elites
• Growing discontent among working-class populations left behind by rapid change
• Civil rights and social justice movements challenging systemic inequality

The political turbulence of the 1920s ultimately set the stage for the upheavals of the 1930s. Whether the 2020s will follow that same trajectory remains an open -- and to any trader, urgent -- question.

Tariffs and Trade Wars: 1929 vs. 2025

The Smoot–Hawley Blunder

• May 1929: The Smoot–Hawley Tariff Act passed the U.S. House.
• October 1929: The stock market crashed.
• June 1930: President Hoover signed the tariff into law.

U.S. trading partners retaliated swiftly, slapping tariffs on American goods. Global trade collapsed by more than 65%, adding to the pain of the Great Depression. While historians debate whether Smoot–Hawley caused the crash, very few question that it deepened the downturn and prolonged the global slump.

“Liberation Day” and Modern Tariff Escalation

• April 2, 2025: President Trump announced “Liberation Day” under his Make America Wealthy Again initiative.
• The plan imposed reciprocal tariffs targeting countries accused of exploiting U.S. markets.

The administration justified these measures under the International Emergency Economic Powers Act (IEEPA), a law enacted in 1977 that allows the president to regulate international commerce during a declared national emergency.

Historically, IEEPA has been used to freeze assets or impose targeted sanctions, not broad tariff structures. Invoking IEEPA for sweeping trade policy is legally unprecedented and politically explosive.

Given the fact that United States has run such deficits for over forty years, the rationale -- that chronic trade deficits represent a national emergency – strains credulity. Whether the courts ultimately uphold these tariffs remains uncertain, but in the meantime, the damage they have created is real, and growing.

Escalation with China

China, refusing to be coerced, responded strategically by weaponizing its dominance in rare earth minerals.

China’s Rare Earth & Magnet Export Controls (2025)

China’s Ministry of Commerce issued Announcement No. 61 of 2025, which introduced:

• Licensing requirements for rare earth exports and related technologies
• Quotas and reporting mandates on critical materials like germanium, gallium, and titanium
• Restrictions on foreign access to Chinese-origin tech via rules similar to U.S. export controls

These measures targeted vital industries: EVs, semiconductors, renewable energy, and defense.

The timing – No. 61 was announced just before a canceled Trump–Xi summit, thus signaling escalation – was strategic.

The U.S. Counterstrategy

The Trump administration countered with a multi-pronged response:

• Trade Measures: 100% tariffs on Chinese imports, effective November 1, 2025.
• Export Controls: Consideration of restrictions on U.S.-made software and components used in laptops, jet engines, and industrial equipment.
• Supply-Chain Initiatives: Incentives for domestic rare-earth mining and new partnerships with allies like Australia and Canada.

Like China’s announcement, the U.S.’s policy has clear strategic implications. China’s export curbs threaten key U.S. supply chains, particularly for defense and advanced manufacturing.  A full-scale trade war risks disrupting global production networks and accelerating de-globalization trends already underway.

The core truth was as relevant in the 1920’s as it is today: cooperation between economic giants produces far more prosperity than conflict ever can. When nations treat trade as a zero-sum game, 2 + 2 becomes far less than 4.

The opportunity cost of pride and protectionism is immense, and ultimately, the people pay the price of such gamesmanship.

Immigration Restrictions: 1920s vs. 2020s

There are also uncanny similarities in the way the U.S. government approached its workforce.

The Quota Era of the 1920s

• Emergency Quota Act (1921) and Immigration Act (1924) imposed strict national-origin quotas favoring Northern and Western Europeans.
• Immigration from Southern and Eastern Europe, Asia, and Africa was severely limited or banned altogether.
• Motivations included fears of communism, racial “purity,” and labor competition.

Impact: Immigration dropped more than 85% from pre-WWI levels, producing a more homogenized national profile and institutionalizing exclusion.

The Security-Driven 2020s

Modern immigration policy is framed less in overt racial terms and more around security, legality, and economic merit—though many argue the results still disproportionately affect marginalized groups.

Recent measures include:

• Stricter asylum eligibility and expedited removals
• Warrantless arrests of immigrants based solely on a possibility of breaking the law, based on appearance or speech patterns
• Greater reliance on executive orders and emergency powers
• Biometric tracking, AI surveillance, and digital border technologies

Motivations:

• National security and terrorism concerns
• Economic nationalism and job protection
• Fear, polarization and populist rhetoric can help sway elections

Impact:

• Record-high deportations and asylum denials in 2024–2025
• Narrower legal pathways, especially for low-skilled workers

Similarities and Differences

Both eras reveal how immigration becomes a mirror for societal anxiety, a visible an outlet for deeper fears about identity, security, and economic fairness.

Global Uncertainty and Power Shifts

The 1920s emerged from the wreckage of World War I; the 2020s are unfolding amid pandemic aftershocks, climate stress, and a shifting world order.

• Germany’s post-WWI reparations led to hyperinflation and instability, paving the way for extremism.
• Today, a similar sense of systemic strain grips the global economy as the East–West rivalry intensifies.

China and the U.S. stand at the center of this contest, but the struggle is broader, encompassing BRICS nations and others seeking to loosen U.S.-dollar dominance.

Both centuries’ post-crisis decades remind us that prosperity and peace are fragile achievements, easily undermined by reckless, knee-jerk policies that do not consider medium and long-term prosperity.

The Demographic Clockwork

Every generation leaves its imprint on markets, culture, and politics. The interplay between demographics and economic cycles often determines whether an era ascends into prosperity or slides into crisis.

Demographic transitions often mark inflection points in markets. As spending power shifts, entire sectors rise and fall. Housing booms fade, healthcare surges, and investment preferences evolve toward new priorities.

The Boomer Wave

• Born 1946–1964, the Baby Boom generation powered postwar expansion and consumption.
• Their peak spending years (1980s–2000s) fueled housing, technology, and equities.
• As they retire, consumption naturally declines, shifting capital from growth to preservation.

Millennials and Gen Z: A New Force

• Millennials now outnumber Boomers in the workforce.
• Their consumption patterns favor experiences, sustainability, and digital assets.
• Gen Z, born digital and globally connected, will shape demand for innovation, authenticity, and inclusion.

These younger generations also face:

• Heavier student debt loads
• Declining housing affordability
• Slower real wage growth

Cycle Theories Pointing Toward a Market Downturn

Throughout my trading career, I’ve studied numerous long-term cycle models. None are perfect, but each offers perspective on the rhythm of markets.

1. Kondratieff Long Waves

Developed by Russian economist Nikolai Kondratieff, this theory identifies 45–60 year “supercycles” driven by innovation, debt, and capital investment.

• Spring (Growth & Expansion) – Innovation and rebuilding
• Summer (Inflation & Overheating) – Peak productivity and credit strain
• Autumn (Speculation & Disillusionment) – Asset bubbles and inequality
• Winter (Deflation & Renewal) – Crisis, deleveraging, and creative destruction

According to this model, we are now be in the late “Autumn” or early “Winter” phase, where inflated asset values, high debt, and waning confidence foreshadow contraction.

2. The 90-Year Crisis Cycle

Historian and economist William Strauss and demographer Neil Howe proposed that roughly every 80–90 years, America undergoes a major crisis reshaping its institutions.

• Revolutionary War (~1780s)
• Civil War (~1860s)
• Great Depression / WWII (~1930s–40s)
• Modern Crisis (~2020s)

Each crisis destroys obsolete systems and births new social orders. By that timeline, we are right on schedule.

3. Demographic and Market Rhythm

Harry Dent and other demographic analysts note that consumer spending peaks at about age 46. When large generations pass that point, demand naturally declines.

• Boomers’ spending peaked around 2007 -- the same year the housing bubble burst.
• The next demographic wave may not mature until the mid-2030s.

This lull could translate into slower economic growth and more volatile markets in the years ahead.

4. Planetary and Geophysical Cycles (Optional Lens)

While I’m not an astrologer, I acknowledge the long tradition of linking planetary cycles to human behavior and market mood. Jupiter–Saturn conjunctions, roughly every 20 years, often align with turning points in economies and empires.

Whether you view these patterns as symbolic or causal, their recurrence across centuries reinforces a broader truth: human behavior follows recurring emotional and social tides.

The Debt Trap and Monetary Excess

Both the late 1920s and early 2020s share one critical vulnerability—excessive debt fueled by easy money.

1920s: The Credit Boom

• Widespread margin trading magnified speculation.
• The Federal Reserve’s loose policy stoked bubbles in stocks and real estate.
• When credit tightened, markets collapsed.

2020s: The Era of Financialization

• Central banks expanded balance sheets beyond historical precedent.
• Governments financed stimulus through debt monetization.
• Corporate buybacks, crypto speculation, and leverage surged.

The result is an economy addicted to liquidity. If rates remain high or credit tightens, today’s valuations could unwind as abruptly as they did in 1929.

Parallels and Divergences

Lessons from the Past

1. Prosperity breeds overconfidence.
   • When optimism becomes ideology, risk management vanishes.
2. Tariffs and isolationism shrink, not grow, wealth.
   • Economic nationalism may feel empowering, but history shows it usually leads to scarcity and inflation.
3. One way or another, debt always demands repayment.
   • Whether through inflation, default, or devaluation, excess leverage finds release.
4. Technological revolutions do not abolish cycles.
   • AI and automation may transform productivity but cannot eliminate the sometimes unpredictable, often irrational effects of human psychology.

Conclusion: A Century’s Echo

We stand, once again, at a moment of exuberance and uncertainty. The same forces that lifted the 1920s—innovation, optimism, and credit—have propelled today’s markets to dizzying heights.

But history’s rhyme does not guarantee destiny. The 1930s followed the Roaring Twenties because excess went unchecked. If we heed the lessons of history—by tempering enthusiasm, guarding against hubris, and building sustainable foundations—the 2030s need not repeat that pain.

Market cycles will always turn. As traders, our goal is not to stop them, but to recognize when one era ends and another begins, then position ourselves to benefit from those transitions.

In my next write-up, I will focus on specific trade ideas and actionable recommendations. For now, I want to share the broader context that shapes how I view the markets. Take gold, for example: I have been a steadfast bull since it traded at $1,820 per ounce. My recent decision to take profits does not alter my long-term bullish outlook. Instead, it reflects my respect for the tendency of certain markets to complete shorter-term cycles with sharp, parabolic moves—both up and down.

Historically, gold, silver, and other markets have repeatedly demonstrated this pattern. Silver, for instance, briefly surpassed $50 per ounce in January 1980 before crashing roughly 77.5%. During that same cycle, gold declined more than 70%. Such extremes remind us that even fundamentally strong assets require caution when markets reach parabolic peaks.

Despite this somewhat gloomy synopsis, I believe that the coming months present numerous exciting opportunities. I look forward to sharing these trade ideas soon. Until then, I wish you the very best in navigating these dynamic markets.

Andy Krieger