Value of $100 in 1926, adjusted to 1989

What happened to prices between 1926 and 1989

Between 1926 and 1989, the Consumer Price Index went from 17.7 to 124. Cumulatively, prices increased 600.6%, which works out to an average of 3.14% per year. Put differently, a dollar in 1926 bought what $0.14 buys in 1989.

Consumer prices rose 1.1% in 1926, a third straight year of mild inflation and part of the price stability that defined the middle of the decade. Florida’s real estate boom, which had peaked the previous year on speculative buying of undeveloped land, ended abruptly that September when the Great Miami Hurricane made landfall near the city, killing hundreds and wrecking the market for land whose value had rested on continued speculation rather than anything underneath it. In Detroit, Henry Ford moved his company to a five-day, 40-hour work week without cutting pay, a break from the standard six-day schedule that other large employers would gradually adopt over the following decades; Ford argued publicly that workers with more leisure time would also become better customers for the cars his factories built. Consumer prices remained low enough by historical standards that a first-class stamp still cost just 2 cents, the same price it had held since mid-1919.

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