By the time 11 states had joined the Confederate States of America (CSA) in 1860, war seemed inevitable. Not even the politicians could stop it. The CSA was not very well prepared when it did break from the United States, which resulted in a near collapse of its economy. People began to save their coins for when they would really need them, and after a very short period there was a distinct lack of circulating currency. As a temporary remedy, many private issuers produced currencies until the Confederacy could create its own money. This fallback was initially successful, but it soon became evident that private currencies would simply not suffice.
Paper Money
The situation escalated quickly and turned desperate. War loomed on the horizon, and many of the Confederacy’s inhabitants had lost their swagger. Precious metals were scarce, and there were almost no local presses to issue other currencies. The Confederacy’s solution was quite innovative: paper money. Confederate dollars were one of the first government-issued paper currencies. Very few paper currencies circulated in North America at the time.
However, there was one problem with this plan. Because of the lack of Southern printing presses, the new currency was printed by the American Bank Note Co., which was located behind enemy lines in New York. Thus, a lot of time and resources were wasted on smuggling the money across the border. Within a few months, printing presses were installed in several key cities in Confederate territory, including New Orleans, which made Confederate money readily available to the South by removing the hassle of smuggling.
Printing officially began in March 1861, and it continued until the end of the war in 1865. Denominations included 50 cents, $1, $2, $5, $10, $20, $50, $100, $500, and $1,000. Approximately $1.7 million of legitimate Confederate money was printed during the war in 72 types and 7 series. However, as more and more Confederate dollars were issued and improved printings were made, the government’s promises for repayment became less attractive to users and investors. One type of Confederate note guaranteed payment two years after the war, a risky gamble. The notes were not guaranteed with any material resources—merely government promises.
Inflation soared, and counterfeit dollars from both within and outside the Confederacy flooded in, choking the already weak market. As morale among the Southern states fell, Confederate notes decreased in value, eventually equating to 3 cents per U.S. dollar. The cost of living became outrageous, with a simple suit of clothing costing $2,700 in Confederate dollars. For a long time after the collapse of the Confederacy, these notes were worth next to nothing. But in recent years, they have become valuable to collectors and history enthusiasts, often demanding high prices that can reach six figures. That’s a noteworthy accomplishment for a dollar that used to be worth 3 cents!
Mints & Coinage
During the Civil War, four mints operated within Confederate territory. Two months before the first shots were fired, and just after the Confederacy was established, the New Orleans Mint was seized by the state of Louisiana for Confederate use. During the war, a large amount of Liberty Seated half dollars were minted explicitly for Confederate use. This was about 1 million out of 2.5 million coins minted during the war. However, the mint also issued coins for the United States just before it had been seized in January 1861, and a large number of coins had been minted and shipped out. In April work began on an original design for the CSA. The Confederate secretary of the treasury had a design for a half-dollar coin sculpted. Four models were made that were distributed to CSA dignitaries. Efforts to make the coin a reality were put to an end during the war when the mint was forced to close due to an extreme lack of bullion resources.
In 1879 an example of the Confederate Liberty Seated half dollar was discovered among Coiner B.F. Taylor’s belongings. The coin was then sold to a private collector. In 1861, 500 half dollars were gathered and repurposed as medallions by the J.W. Scott and Company of New York. The medallions featured a new Confederate-themed stamp on the obverse and the original 1861 half-dollar reverse.
Another coin, commissioned by the CSA in 1861, was rediscovered in 1863. This 1-cent coin was designed by Robert Lovett Jr., who, after making 12 or so models, hid them carefully, as he feared arrest by the United States. When the original dies for the coin, as well as the original models, were found, restrikes were made. These are easily identifiable, as they are more flawed than the originals.
The Civil War is a massive chapter in American history. Although one of the poorest times for the nation, it was arguably the richest in monetary developments. Despite the devastation the war wreaked, we can still appreciate the mark it left on numismatics.