progress was the price of Henry Ford’s cars. The Model T, $600 before the war, sold for $240 in the mid-1920s. Right after the war it seemed that the United States had become the greatest power through might. With the growth of the 1920s, the country was showing that it deserved to be that power. Coolidge began his December 6, 1927, yearly message to Congress by announcing that “It is gratifying to report that for the fourth consecutive year the state of the union in general is good.” There was a sense among political leaders that industrial America would do even better than agricultural America had done.
The progressives, who once had hoped to take the country, now seemed to be fading. The name of Bob La Follette, the great reformer of Wisconsin, simply did not mean as much as it had even as recently as 1924, when La Follette had won 16.6 percent of the vote in the presidential election, promising to end “an orgy of corruption” and quick and easy access to the White House. Among citizens, it was increases in the standard of living that seemed to be raising hope. In Indiana two social scientists, Robert and Helen Lynd, undertook a study of a single town, Muncie, which they called Middletown. In Middletown, the Lynds found that new inventions were remaking home, work, and leisure: the radio, the automobile, and the telephone, a new medium that created a “semi-private, partly depersonalized means of approach to a person of the other sex.” This was the decade in which Americans began traveling the country in automobiles, and the decade they began to prefer the telephone to the post-church visit.
The stock market rose faster toward the end of the decade. Anew generation of Americans turned to it. One was Bill Wilson, the Vermonter who had won Edison’s contest. Wilson, like so many men, came to Wall Street after serving in Europe to see if he could play the equities game. An uneven fellow, Wilson drank too much and found himself subsidized by his wife’s family in Brooklyn Heights. But he was a tinkerer, an Edison if only in temperament, and when it came to the financial world, he spotted a genuine flaw. Everyone traded stocks, but even the experts knew relatively little about the companies they came from. He himself, the Edison enthusiast, had bought a few shares of General Electric at $180 a share; now they were worth $4,000 or more. But why? Wilson bought a Harley-Davidson with a sidecar for his wife, Lois; they would ride around the country investigating companies. It was an early version of modern stock analysis. Companies shouldn’t merely be reported on, as in the papers; they ought to be studied. He began to make money.
Wilson’s attempts to shed light on the mystery of markets were the humblest version of what his colleagues on Wall Street and at universities were trying to do. One was Irving Fisher, a professor at Yale who had been a student of the great philosopher William Graham Sumner.
Sumner and Fisher had disagreed on many things. Sumner had told Fisher that if life came down to a choice between socialism and anarchy, he would take anarchy. Fisher, reporting this to the Yale Socialist Club, told his audience that given the same choice, he would take socialism. But Sumner had imparted to Fisher, and generations of other students, a deep understanding of the degree to which tariffs could slow the economy. And he also started Fisher off on his career by suggesting that he look into the mathematical side of the economy, then a new approach. Fisher, an erratic but brilliant man, proceeded to create indexes to measure the rise of commodity prices, then a new concept. He also looked at prices and money generally in a new way. He believed that the gold standard slowed growth. One of its problems was that gold was too unpredictable, and that a stabler currency might be arrived at by linking the dollar to a group ofcommodities, instead of to gold. Fisher, like Wilson, was investing even as he
The progressives, who once had hoped to take the country, now seemed to be fading. The name of Bob La Follette, the great reformer of Wisconsin, simply did not mean as much as it had even as recently as 1924, when La Follette had won 16.6 percent of the vote in the presidential election, promising to end “an orgy of corruption” and quick and easy access to the White House. Among citizens, it was increases in the standard of living that seemed to be raising hope. In Indiana two social scientists, Robert and Helen Lynd, undertook a study of a single town, Muncie, which they called Middletown. In Middletown, the Lynds found that new inventions were remaking home, work, and leisure: the radio, the automobile, and the telephone, a new medium that created a “semi-private, partly depersonalized means of approach to a person of the other sex.” This was the decade in which Americans began traveling the country in automobiles, and the decade they began to prefer the telephone to the post-church visit.
The stock market rose faster toward the end of the decade. Anew generation of Americans turned to it. One was Bill Wilson, the Vermonter who had won Edison’s contest. Wilson, like so many men, came to Wall Street after serving in Europe to see if he could play the equities game. An uneven fellow, Wilson drank too much and found himself subsidized by his wife’s family in Brooklyn Heights. But he was a tinkerer, an Edison if only in temperament, and when it came to the financial world, he spotted a genuine flaw. Everyone traded stocks, but even the experts knew relatively little about the companies they came from. He himself, the Edison enthusiast, had bought a few shares of General Electric at $180 a share; now they were worth $4,000 or more. But why? Wilson bought a Harley-Davidson with a sidecar for his wife, Lois; they would ride around the country investigating companies. It was an early version of modern stock analysis. Companies shouldn’t merely be reported on, as in the papers; they ought to be studied. He began to make money.
Wilson’s attempts to shed light on the mystery of markets were the humblest version of what his colleagues on Wall Street and at universities were trying to do. One was Irving Fisher, a professor at Yale who had been a student of the great philosopher William Graham Sumner.
Sumner and Fisher had disagreed on many things. Sumner had told Fisher that if life came down to a choice between socialism and anarchy, he would take anarchy. Fisher, reporting this to the Yale Socialist Club, told his audience that given the same choice, he would take socialism. But Sumner had imparted to Fisher, and generations of other students, a deep understanding of the degree to which tariffs could slow the economy. And he also started Fisher off on his career by suggesting that he look into the mathematical side of the economy, then a new approach. Fisher, an erratic but brilliant man, proceeded to create indexes to measure the rise of commodity prices, then a new concept. He also looked at prices and money generally in a new way. He believed that the gold standard slowed growth. One of its problems was that gold was too unpredictable, and that a stabler currency might be arrived at by linking the dollar to a group ofcommodities, instead of to gold. Fisher, like Wilson, was investing even as he
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