Value of $100 in 1925, adjusted to 1953

What happened to prices between 1925 and 1953

Between 1925 and 1953, the Consumer Price Index went from 17.5 to 26.7. Cumulatively, prices increased 52.6%, which works out to an average of 1.52% per year. Put differently, a dollar in 1925 bought what $0.66 buys in 1953.

Consumer prices rose 2.3% in 1925, the CPI’s largest single-year increase since the deflationary swings of the early 1920s, though still mild next to the double-digit inflation of the World War I years. The country’s cultural fault lines were on full display that summer in Dayton, Tennessee, where high school teacher John Scopes was tried July 10-21 for violating a state law against teaching evolution, a case that drew national press coverage and pitted prosecutor William Jennings Bryan against defense attorney Clarence Darrow. Real estate speculation, meanwhile, peaked in Florida, where buyers flipped undeveloped land in the Miami area on thin down payments, driving prices far above what the land itself could support; the bubble would collapse the following year. Detroit reshuffled that June too: Walter Chrysler reorganized the struggling Maxwell Motor Company into Chrysler Corporation, the start of what would become one of the American auto industry’s “Big Three.” First-class postage held at 2 cents for the sixth straight year.

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The destination year: 1953

Consumer prices rose 0.8% in 1953, down from 1952’s 1.9% as fighting in Korea wound toward a truce and three years of wartime buying pressure finally eased. The year’s biggest shock came from Moscow: Soviet leader Joseph Stalin died March 5 after nearly three decades in power, the first change of Soviet leadership since the 1920s, opening a period of uncertainty over how his successors would deal with the West. Washington used the calmer backdrop to unwind its own wartime machinery. Authority for the price and wage controls imposed in 1951 lapsed that spring, as the Eisenhower administration, which favored free markets over controls, wound down the Office of Price Stabilization. The war itself ended, on paper, that July: negotiators signed an armistice July 27 at Panmunjom, halting the fighting roughly along the original border near the 38th parallel. No formal peace treaty ever followed, and North and South Korea remain technically at war. Consumer prices finished 1953 169.7% above their 1913 level. First-class postage held at 3 cents, and the minimum wage stayed at 75 cents an hour.

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