![confederate bank note confederate bank note](https://images.pristineauction.com/73/730996/main_1504836388-1864-500-Five-Hundred-Dollars-Confederate-States-of-America-Richmond-CSA-Bank-Note-Bill-PristineAuction.com.jpg)
See also: Civil War (Economic Causes of), Civil War (Economic Impact of), Greenbacks, Inflation, National Bank Act of 1863 Grant (1822 –85) at old Appomattox Court House, Virginia. Lee (1807 –70) surrendered his ragged Confederate troops to Union General Ulysses S. While funding the war was also a struggle for the Union, the industrial-based economy of the northern states helped the country sustain, and eventually win the conflict. The South's inability to raise the capital it needed to wage war was a major factor in its eventual defeat. By January 1865 wartime inflation had reduced the value of Confederate paper money to $1.70 per $100 (or just under two cents to the dollar). Because there was nothing to back up the currency, the dollars quickly lost value and became almost worthless.Īs the currency became devalued, inflation climbed: In 1861 the price per bushel of salt was eighty cents in Confederate currency by the end of the following year this price rose to 30 Confederate dollars per bushel.
![confederate bank note confederate bank note](http://numismaclub.com/imgs/a/j/h/m/b/1864_50_confederate_states_of_america_bank_note__crisp_1_lgw.jpg)
As the war continued, the Confederacy was forced to print more paper money. In need of funds the provisional government of the Confederacy issued $100 million in paper currency in August 1861. The South's agricultural economy made it difficult to raise taxes and the large sums of money required to make war against the Union. The North held much of the nation's wealth, and so the newly formed Confederacy was faced with the problem of financing its war effort. After the South seceded early in 1861, fighting broke out on April 12 at Fort Sumter, South Carolina: It was the first battle of the American Civil War (1861 –65). Confederate dollars were the paper money issued by the Confederacy (of Southern States) to help fund the war against the Union.