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One Dollar Bank of De Soto Nebraska Reproduction *COPY* ***Reproduction*** Union currency United States Civil War Banking and the Civil War, or, Floating Away on a Sea of Paper Money Beginning in March 1861, the Confederate States of America began printing its own paper banknotes. The earliest notes, known as the Montgomery Issue, after the Confederacy’s first capital in Montgomery, Alabama, were printed in New York by the National Bank Note Company and smuggled across the Union lines. Subsequent issues were printed in New Orleans; Richmond, Virginia; and Columbia, South Carolina. As the war stretched on and major industrial centers, including New Orleans, fell to Union forces, the Confederacy had difficulty maintaining access to the supplies and safe passage needed to print and distribute CSA money not only to banks, businesses, and private citizens, but also to the hundreds of thousands of officers and soldiers fighting for the Confederate cause. Furthermore, because the CSA printed money without tying the value of its notes to actual treasury resources (which were limited despite efforts to raise funds through bond issuances), the notes were subject to widespread inflation. State treasuries were also actively engaged in financing the war and state economies. They, too, printed money without regard for gold and silver specie on hand. Louisiana mobilized its state banking system in support of the war in 1861, and Governor Thomas Overton Moore issued an order to all Louisiana banks to suspend specie payments in November of that year, leaving the state and its inhabitants to operate in an economy based entirely on paper money. Note issuances were not limited to the CSA and state. Forty of Louisiana’s forty-eight parishes printed their own paper money during the Civil War, and towns across the state—from Shreveport to Alexandria, from Natchitoches to Clinton, from Thibodaux to Baton Rouge—all sought to satisfy the demand for a circulating currency by turning to the printing press. Even private businesses, including Magazine Street saddlers Magee and George, issued notes redeemable for goods and services when national, state, and even municipal notes were too scarce to offer as change.
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