Traveling clothier salesman Mads Andersen-Skjern arrives in Korsbæk with his little boy Daniel and sees opportunities when faced with the inept draper Albert Arnesen and this small sleepy town where the old families define the pace and virtue. Receiving only haughty condescension from the upper-class, Mads finds local allies in the family of pig trader Oluf Larsen and his wife Kathrine, who has more money than meets the eye.

The town's bourgeoisie watch with judging and disapproving eyes as Mads Skern opens his new clothing shop, in direct competition with Arnesen's. Oluf Larsen's daughter, Ingeborg, starts as a clerk in his store, much to Mads' pleasure.

Arnesen's store is losing money hand over fist, so when he learns that his manager, Mr. Schwann, has inherited a large sum, he persuades him to become his partner; the snobby Mr. Schwann gleefully throws his entire inheritance into Damernes Magasin, prolonging the inevitable for a few months.

Mads' business continues to thrive and he even begins issuing loans to the locals. His younger brother Kristen, a banker, arrives in Korsbæk to assist. Kristen is quickly smitten with Maude's sister Elisabeth, who otherwise lives in the shadow of her sister. They fall in love, but their liaison is impossible due to the rivalry of their respective families.

Arnesen is in the shambles, and even Varnæs cannot aid him financially any further.

To the horror of the bourgeoisie employees of Arnesen's clothing store, Vicki, now a young widow, sells the store to Mads Andersen-Skjern and moves to Copenhagen, against her father's will.

While Mads Skjern continues to expand his businesses, Hans Christian Varnæs battles a new dynamic force in the board of his bank, the state lawyer Viggo Skjold Hansen, who has obtained his shares and board seat from the spiraling Jørgen Varnæs.

The internationally renowned painter Professor Ernst Nyborg lands in Korsbæk. He is a former art teacher and romantic interest of Maude Varnæs. Also arriving to witness Nyborg's exhibit is Gitte Graae, Jørgen Varnæs' home-wrecking and increasingly expensive lady friend.

The Varnæsses' maid, Agnes Jensen, quits her job to get married to railway employee and local communist, Lauritz "Red" Jensen, but to her dismay, Red quickly invites a German refugee, the poet Herbert Schmidt, to live with them in the spirit of solidarity.

Mads' building project is well under way, but Mrs. Møhge supported by Skjold Hansen continues to fight him. Skjold Hansen's daughter Iben arrives in town, having cancelled an upcoming wedding in Germany, and begins flirting with Kristen Skjern. Elisabeth Friis causes a furor, when openly supporting an abortion doctor, bringing her at odds with her and her sister's social circle.

Agnes delivers a boy, while Vicki, widow of Arnesen, returns to Korsbæk as a traveling vaudeville actress and reconciles with her father, the Colonel. Via Oluf Larsen she meets Herbert Schmidt, who now lives with the Larsens. Hans Christian Varnæs learns that his mistress Ms. Jacobsen is pregnant from their affair. She wants an abortion, which he pays for in betrayal of his own morals.

Herbert Schmidt and Lauritz "Red" Jensen embark for Spain to fight the fascists in the Spanish Civil War, but Red changes his mind en route, while Herbert continues on. Elisabeth relays an offer from Hans Christian Varnæs to Kristen Skjern of a position at a bank in Jutland, but Kristen see it as a plot to separate him from his brother, Mads, who is still being hammered by Skjold Hansen's investigations.

Mads is back in business and expands on all fronts and moves his family to a large villa outside of Korsbæk. The Varnæs couple returns from a trip to Paris, envigourated and with Maude bringing back something extra. The Varnæs home is to house a party with people whom they've met in Paris much to Laura's regret.

Jørgen Varnæs feels Mads' hand when Jørgen has taken an early Christmas vacation (on December 7) and has traveled to Switzerland. Upon his return a month later, Mads de facto reduces Jørgen's salary by half. Jørgen seeks help from his brother who is unable to provide any relief. Hans-Christian bites the bullet and seeks out Mads to speak for Jørgen.

As Oluf Larsen is arranging pictures of assorted fascists in his outhouse, he's surprised by Herbert Schmidt, returned from Spain. He's reunited with Vicki, who'd become a teacher at the private school (replacing teacher Andersen). World War II breaks out causing rationing of certain goods in Denmark (sugar and gasoline). Agnes is to wait at Daniel's confirmation party, leaving Lauritz to look after the children - with the most serious consequences.

Laura, having served the Varnæs family for 25 years, are going with Maude to Copenhagen to receive a medal for "loyal service". There, Maude, through a childhood friend meet a German who presents himself as a banker. Agnes, coming to see Laura get the medal, looks up Herbert Schmidt who's putting up a play called "The Boots" in Copenhagen.

Sofus Jensen, Korsbæk's beat policeman, seeks out Lauritz along with a police lieutenant early in the morning of June 22, 1941, the day Hitler declares war against the Soviet Union. The good nurtured officer feigns a story that Lauritz has already left the premises so as to give Lauritz a chance to escape. Lauritz seeks help from the Larsen family, and through Kathrine, Lauritz gets a lift to Copenhagen via a reluctant Mads.

Skjern's business is thriving despite the war and in part due to Daniel's help. The local resistance group launch sabotage missions, and the pictures of dictators in Larsen's outhouse has him thrown in jail, which puts the entire resistance-group in danger, causing Baron von Rüdtger to also get involved with the movement. Mr. Stein, Varnæs' trusted bank manager, falls victim to harassment due to his Jewish background, and later he must flee the bank as the Germans launch their endlösung hunt for the Danish Jews on October 1st 1943.

Doctor Hansen seeks out Agnes Jensen and offers her to flee with her children to Sweden, where her husband Lauriz is. But her business is thriving, and she refuses. For business, Agnes seeks out Mads Skjern, who is impressed by her ingenuity. Mads agrees to a rare and lavish bet, when Agnes desires to buy her business' lodging house from Kathrine Larsen, which only Agnes believes that Kathrine can be talked into. Meanwhile, Mads is reluctant to do business with the Wehrmacht, while also warning his brother Kristen against his operations in the resistance.

The war makes it increasingly difficult to secure heat even for the Varnæs family, who send their children to the public bath house. Misse Møhge wishes to arrange her financial plans with the Varnæs brothers before her wedding, but the brothers seek a delay because of the ongoing war. Misse and Andersen are married. Mads seeks to purchase a seaside farm house and estate, which he wishes to divide up and sell. He enters a shady tax-evading deal with both the house's owner and Jørgen Varnæs, who buys the farm on behalf of Mads, in exchange for a small unsolicited fee.

The funeral dinner for Frederik Andersen is progressing at the Varnæs house when the radio suddenly broadcasts the news that the Germans have surrendered in Denmark. Amidst general rejoicing, Dr. Hansen and Kristen Skjern reappear and pay a visit to the Varnæs house, where Kristen is reunited with Elisabeth Varnæs. Mads is very nervous about Ellen, since her father-in-law had lucrative business dealings with the Germans and has been arrested as a collaborator. Mads decides to find Ellen and bring her home.

Skjold Hansen has announced his retirement from the Korsbæk Bank Board. Bank President Jessen suggests that Jørgen Varnæs return to the board as Skjold Hansen's replacement, but he wishes to meet with him first. Hans Christian Varnæs organizes a dinner for them. There, Jessen confronts Jørgen with his suspicion that his wife, who is the sister of the seller, was defrauded of her share of the proceeds from the farm sale that Jørgen conducted as a front for Mads Skjern. Jessen demands an investigation, before he will nominate Jørgen for the vacant bank directorship.

Ulrik reveals to Ellen that he is to marry Maja, prompting Ellen to sever all relations. Misse, now a widow, reveals to the leading ladies of the town that she's attracting men, even the pious Provost Meyer, who she claims to have seen on her balcony. Chairman Jessen from Korsbæk Bank, unsatisfied with the business involving Jørgen, finds another candidate for the board position - the Mayor. Mads gets wind of this and arranges the Mayor's inclusion in Omegnsbanken's board, while accusing Kristen of professional negligence.

Mads comes home from a trip to USA bringing with him new business ideas. Despite Daniel not having completed his exams, Mads calls on Daniel to help implement the ideas. Mads is yet again disappointed when Daniel declines, and opts to go to Paris and study fashion.

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