Wednesday, November 20, 2013

A Monetary Innovation That Changed the Course of the War

From the August 29, 2012, Bloomberg by Franklin Noll. //// In the summer of 1861, U.S. Secertary of the Treasury Salmon P. Chase negotiated a loan of gold from banks. Until the gold's arrival in Washington, D.C. he issued $50 million on on demand notes to fund the military effort. //// The Treasury back then had no facility to produce paper money. Bills were made by the American Bank Note Company in New York which produced them in sheets of four bills which would be sent to the Treasury department where workers cut and trimmed them with scissors, some 7 million notes. //// This led to the formation of the U.S. Bureau of Engraving and Printing which today produces billions of dollars. //// In early 1862, with the war dragging on and costs skyrocketing, the Treasury was going broke so Congress authorized $150 million in new currency which became known as Greenbacks. Workers still had to process 20 million notes by hand. //// Treasury clerk Spencer M. Clark mechanized the process in separating the notes when he invented a hand-powered machine to separate and trim them. Later, the machine was modified to be powered by steam. //// A Money-Making Process. --Old Secesh

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