1920–1950: The Deflation Era — When Investors Kept 82% of Gains

Name: 1920–1950: The Deflation Era — When Investors Kept 82% of Gains
Uploaded: 2026-02-01T11:45:00+00:00
Duration: 45 s
Channel: Bellavia Team
Description: Just 0.7% annual inflation for 30 years. $100 became $987 nominally and $812 in real terms. Investors kept 82% of their gains.

Just 0.7% annual inflation for 30 years. $100 became $987 nominally and $812 in real terms. Investors kept 82% of their gains.

🎬 Video US Market Periods — Low Inflation By Bellavia Team February 01, 2026

Thirty years. 0.7% average inflation. That's not a typo.

The 1920–1950 period is the closest thing to price stability in the modern record. $100 in the S&P 500 became $987 nominally and $812 in real terms — investors kept 82% of their gains as actual purchasing power.

What stands out

This "low inflation" era was anything but calm. It contained the 1920–21 deflation (prices crashed 18% in a single year), the Great Depression (another 25% decline in prices), and wartime spending that clawed everything back up. Deflation and inflation effectively cancelled each other out over 30 years.

The result was accidental price stability. And for anyone who stayed invested through those wild swings, compound growth worked almost entirely in their favour. Compare this to 1950–1980, when investors kept less than 35% of nominal gains after inflation.

The video tracks how $100 grew through three decades of violent price swings that, remarkably, netted out to almost nothing.

Explore this period in Bellavia's historical backtester.