There were some significant signs during the 1920s that the economy was not strong. While investors and owners of large businesses did very well when their stocks increased in value, the people who worked for them did poorly. A small number of Americans controlled the majority of the nation's wealth, and with the deregulation and anti-labor movements of the 1920s, this would only get worse.
Those most hurt by the economics of the 1920s were factory workers and farmers. Many farmers had bought new machinery or borrowed money for more land before 1920, as they thought that WWI would continue. The war proved to be valuable for the farming sector, as the United States exported tons of food to the Allies and later to the refugee crisis in Belgium. When the war ended suddenly in November 1918, Europeans went back home and farmed, thus creating less of a need for American exports. Farmers produced more in order to try to compensate for the falling prices, thus leading to a system of increased yields and falling prices due to excess supply. Sharecroppers were especially hard hit, as their rents increased. Factory workers still experienced lay-offs during the 1920s, and what could be a good job one day could be a non-existent one the next. Due to anti-Left sentiment, the industrialists and government were in no mood to tolerate the demands of workers, because the mood in the country was anti-labor due to the Communist revolution in Russia. While there was a growing middle class of professionals who could hope to send their children to college and have leisure time for vacations, the majority of Americans still lived paycheck to paycheck and crop to crop in 1929.
During the so-called "Roaring Twenties," the inequality between the rich and poor grew. The wealthiest 1% of Americans saw their income skyrocket by 75%, while most Americans only saw their income go up by only 9%. About 70% of Americans earned less than $2,500 a year, which was the benchmark considered necessary at the time to begin to lead a good life. By 1929, the year of the stock market crash, the top .1% of Americans owned as much wealth as the bottom 42%.
The people who gained were people like car-maker Henry Ford, whose annual income was $14 million. President Coolidge also lowered inheritance taxes, which meant that people who inherited wealth did very well. Therefore, the very rich were doing very well in the 1920s, while the rest of the country wasn't. This income inequality was one of the contributing factors to the Great Depression, as most Americans could not buy the new consumer goods and other products that were being made. Therefore, production far outstripped demand, leading to economic weakness and eventually to the Great Depression.
The Americans who gained the most during the 1920s were those who already had some money. The gains in wealth that came about as stock prices went up, for example, went mainly to those rich enough to put a lot of money into stocks. In addition, the rise of huge companies made a few captains of industry very rich indeed.
On the other hand, most historians argue that farmers and workers were not sharing in the prosperity. The agricultural sector was the weakest sector in the economy. Prices dropped and many small farmers had to get out of farming as competition from larger farms overwhelmed them.
Workers, too, were hurt, according to most historians. The Republican administration of the 1920s was fairly anti-union. During the 1920s, labor union membership dropped dramatically, partly because of anti-union moves by the government. It must be said, however, that wages did go up during this time even if workers in many industries (like mining and textiles) did suffer as technology destroyed jobs and union as unions lost power.
Overall, then, most historians argue that the rich got richer in the 1920s and the farmers and workers either got poorer or did not benefit as much as the rich did.