Making Money: Currency in the Confederate States

iStock/mj0007
iStock/mj0007

When the Civil War began, the Confederacy quickly found itself facing a pressing issue: fighting a protracted war is really, really expensive. Unlike their Union counterparts, the Confederate states didn’t boast vast reserves of money and precious metals, either. With a Union naval blockade diminishing the lucrative international cotton trade, the Confederacy needed a way to raise some quick cash.

The Confederacy could have gone on a taxation rampage to drum up some funds, but the Southern states weren’t exactly keen on having a national government, even a Confederate one, collecting big taxes. Plus, there wasn’t any infrastructure in place to support mass taxation. Instead, the Confederacy started printing its own money.

As short term solutions go, printing your own cash is a fairly elegant one. You don’t have to levy any unpopular taxes, and as long as people will accept and use the money as a medium for trade, you’re in good shape.

Of course, in the long term, simply setting up a printing press and cranking out money without a comprehensive monetary policy and financial system in place can be a truly terrible idea. The Confederate notes didn’t have any gold, silver, or anything else backing them; instead, they promised to be redeemable for their face value after a certain period of time, say six months or two years, “after the ratification of a treaty of peace between the Confederate States and the United States of America.”

While currencies don’t necessarily have to be backed by anything tangible to be successful – just ask the euro or the dollar - astute readers have already noticed the rub in this system: the bills would only be redeemable if there were still a Confederacy around to cash them after the ratification of a peace treaty. If the Union came out on top, the Confederate money would be worthless. In addition to this gamble about the war’s outcome, the Confederacy kickstarted inflation in its states by continuing to print more and more of the currency. In a lesson straight out of freshman economics, as the supply of Confederate bills shot up, their value crashed.

By the time the Confederacy dissolved on May 5, 1865, the currency was already effectively worthless. The combination of the inflation that had kicked in as the Confederacy kept printing more money and Southerners’ growing skepticism about the continued existence of their breakaway government cratered the currency. At the war’s end, the value of 100 Confederate dollars had plummeted to $1.76, which equates to a rate of inflation of around 9,000 percent.

When the South failed to rise again (at least in Confederate form), many Southerners were left sitting on giant piles of worthless currency from a defunct country. Tough luck, to be sure, but what they may not have known was that they could just have taken a voyage to Germany to recover some of their lost value. On May 30, 1909, The New York Times ran a story under the headline “CONFEDERATE MONEY TAKEN: German Shopkeepers Apparently Ignorant That Civil War Is Over.”

According to the story, many merchants, hoteliers, and café proprietors in Berlin were still accepting Confederate cash that hadn’t been worth its face value in over four decades. The American consulate in Berlin had been fending off German businessmen who were trying to exchange their notes from, say, the Bank of Richmond for German currency. Whoops. The article closed with the line “[S]ome of [the merchants] have left the consulate convinced that the United States Treasury has really ceased payment and is ashamed to admit it.”

The Germans eventually wised up, but apparently this question still comes up from time to time. The Bureau of Engraving and Printing feels compelled to explicitly state on its website that “Confederate States Notes were not produced by the BEP and are not obligations of the United States Government.”

Just because you can’t take your Confederate money to the bank or use it to pay off a parking ticket doesn’t mean it’s worthless, though. There’s a collector’s market for the bills that can be quite lucrative. While most bills probably aren’t valuable enough to pay Stonewall Jackson’s salary, a quick scan of eBay auctions shows that even the rattiest examples of small-denomination bills regularly sell for over $10. Mint, uncirculated bills in higher denominations can fetch hundreds of dollars at auction.

15 Convenient Products That Are Perfect for Summer

First Colonial/Lunatec/Safe Touch
First Colonial/Lunatec/Safe Touch

The Fourth of July is the epitome of summer—and after several months spent indoors, you need some outdoor fun more than anything. Check out these 15 summer must-haves while they’re on sale and save an extra 15 percent when you spend $50 or more with the code JULYFOURTH15.

1. CARSULE Pop-Up Cabin for Your Car; $300 (20 percent off)

Carsule tent from Mogics.
Mogics

This tent connects to your hatchback car like a tailgate mobile living room. The installation takes just a few minutes and the entire thing stands 6.5 feet tall so you can enjoy the outdoors from the comfort of your car.

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2. Mosquito Killer Lamp; $30 (25 percent off)

Mosquito-killing lamp.
Kinkoo

If you just so happen to be one of those unlucky souls who attracts a suspicious amount of mosquitos the second you step outside, you need this repellent lamp to help keep your arms and legs bite-free. It uses a non-toxic combination of LED lights, air turbulence, and other methods to keep the pests at bay.

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3. Super Shield Mosquito Repellent Electronic Watch Band; $17 (57 percent off)

Mosquito repeller watch.
Safe Touch

While a lamp is a great non-toxic solution for keeping bugs at bay, active individuals need a bug repellent that can keep up with their lifestyle. This wrist wearable keeps you safe from mosquitoes anywhere by using ultrasonic sounds to drive them away.

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4. ZeroDark 3-Piece Tactical Set: Flashlight, Lantern, and Headlamp; $20 (66 percent off)

Aduro flashlight set.
Audro

If you want your summer to be lit, this set will do the trick. All puns aside, this trio of LED brightness is perfect for camping fun and backyard parties, or it can be stored in the car for emergencies.

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5. Outdoor Collapsible Cooler and Camp Table Set; $64 (27 percent off)

First Colonial cooler.
First Colonial

Cookouts are easy with this cooler and table set that chills your drink until you're ready to pop it into one of the four convenient cupholders. Bring this set camping or out by the pool for convenience anywhere.

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6. Trident: Underwater Scooter; $550 (21 percent off)

Trident underwater scooter.
Geneinno

If you’ve ever dreamed of better mobility while exploring the water, you’re not alone. The Trident underwater scooter, which raised over $82,000 on Indiegogo, can propel you through the water at up to nearly 6 feet per second, which isn't that far off from how fast Michael Phelps swam in his prime. The battery on it will last 45 minutes, allowing you to traverse with ease.

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7. Go Portable Solar Oven; $119 (14 percent off)

GoSun solar grill.
GoSun

Bake, roast, steam, or broil anywhere you bring this portable oven. Measuring in at just over a foot long and weighing only two pounds, the oven will work in most daytime weather conditions and can hold around 13 ounces of food.

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8. 3-in-1 Waterproof Bug Zapper Lantern; $25 (50 percent off)

3P Experts bug zapper.
3P Experts

Mosquitoes tend to be a big problem at night, partly because it's hard to swat in the dark. This lantern will light the area and zap mosquitos from nipping at you in the process.

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9. Urban E-Skateboard: Basic Version (Orange); $120 (73 percent off)

Urban Rover E-Skateboard
Urban Rover

This e-skateboard is perfect for getting around during the summer. You'll catch a breeze while you’re cruising on the battery-powered platform and won’t break a sweat when you pop the compact board in your bag.

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10. H2 Headlamp: Waterproof, Rechargeable LED Wide 180° Angle Headlight; $37 (26 percent off)

Headlamp from One80Light
One80Light

Camping, car troubles, and sports all pose a problem at night. This LED headlight will light up your surroundings across a 180-degree radius for prime visibility, meaning your outdoor activities won't have to stop when the sun sets.

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11. Whirlwind Cool Bladeless Mini Fan; $22 (63 percent off)

Bladeless fan
Whirlwind

This portable fan comes in a powerful handheld size so you can keep cool while on the move. Unlike other portable fans, this one has a sleek, bladeless design and features three different speeds.

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12. Bladeless Personal Fan; $22 (63 percent off)

Bladeless fan
3P Tech

This bladeless fan won't just keep you cool while you work on your laptop—it also has a built-in rechargable battery that you can use to charge your phone.

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13. MOGICS Coconut: Portable Waterproof Light; $37 (24 percent off)

Mogics portable lamp.
Mogics

This portable light is designed to adapt to your lighting preference. It self-inflates in a few seconds and can bounce, get wet, and set the mood.

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14. Lunatec 1L Hydration Spray Water Bottle; $25 (21 percent off)

Lunatec spray water bottle.
Lunatec

A water bottle can do more than hydrate you. This one has a spray nozzle that can create shower, stream, and mist patterns for doing dishes while camping, sharing a sip without sharing germs, and washing off those muddy shoes after a long hike.

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15. Sport Force Hydration Backpack; $25 (68 percent off)

Hydration backpack.
It's All Goods

Hiking enthusiasts know how important it is to stay hydrated, but carrying around awkward jugs of water is a hassle. This unique hydration backpack can be filled with two liters of water and features a convenient drinking nozzle that extends to the user's mouth. Now, you can replenish those fluids without breaking stride.

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This article contains affiliate links to products selected by our editors. Mental Floss may receive a commission for purchases made through these links. If you haven't received your voucher or have a question about your order, contact the Mental Floss shop here.

The Best Way to Defer Your Credit Card Payments During the Coronavirus Shutdown, Explained

Credit card companies can offer financial assistance, but there can be drawbacks.
Credit card companies can offer financial assistance, but there can be drawbacks.
alexialex/iStock via Getty Images

A number of financial relief options are available to Americans who have been affected by the unprecedented health situation created by the spread of the coronavirus. Mortgage companies are offering forbearances; insurance companies have lowered premiums for cars that aren’t being driven. Credit card companies have also acknowledged that cardholders may have trouble keeping up with their bills. While many companies are eager to help with debt and interest, there are some things you should know before picking up the phone.

The good news: If you’re unable to make your minimum monthly payment in a given month, major card issuers like Chase, Capital One, and others are willing to grant a forbearance. That means you can skip the minimum due without being hit with a negative strike on your credit report for a missed payment.

A forbearance is no free ride. Interest will still accrue as normal, and the card issuer may consider the missed payment deferred, not waived. If you pay $50 monthly, for example, and are able to skip a May payment, make sure the card won't expect a $100 minimum in June to cover both months. Ask the company to define forbearance so you know what’s expected. Some may be willing to lower your minimum payment instead, which could be a better option for you.

While the skipped payment won’t impact your FICO credit score directly, be aware that it could still have consequences. Because many minimum payments mainly cover interest, your balance won’t remain the same—it will continue to grow. And because that interest is still adding up, your total amount owed is still going up relative to your available credit, which can affect your score.

If you have a sizable amount due, the National Foundation for Credit Counseling (NFCC) recommends looking into alternatives to forbearance, like using savings to pay down some high-interest cards, taking advantage of zero-interest balance transfer offers, or even taking out a personal loan with a lower interest rate.

If you have multiple credit card balances and the prospect of trying to get through to a human to discuss payment options seems daunting, the NFCC is offering their assistance. The agency can put you in touch with a credit counselor who can act on your behalf, obtaining forbearances or other relief from the card companies. Be advised, though, that card issuers may want to get your permission to deal with the counselors directly. The program is free and you can reach the NFCC via their website.

Be mindful that emergency relief is different from a debt management plan, which consolidates debt and can have a negative impact on your credit card accounts.

In many cases, the best thing to do is to pick up the phone and deal with the card issuer directly. Explain your situation and ask about what options they have. Some might waive payments. Others might offer to lower your interest rate. No two card issuers are alike, and it’s in your best interest to take the time to see what’s available.

[h/t lifehacker]