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WEEK #352 - Happy Happy St. Valentine's Day!

Started by Moon,

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Moon

Moon

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QUESTION:

 

During the Civil War, Abraham Lincoln needed money to finance the war, so he ordered the printing of $450 million in full legal tender. What distinct difference did these notes have to distinguish them from other notes that were not fully backed by the U.S. government?

 

 

Good Luck!

 

Our first place winner will receive a coupon for 1 note graded under the Standard grading tier. (You must have an active account with PMG, call PMG for details) There will also be a runner up prize given to a randomly selected player with the correct answer.

 

 

REMINDER: The Numisma-Quest ends on Saturday at midnight EST. Entries after that time will not be valid. See the Trivia info post for more details.

 

When you post your answer, only the administrators can see it . Stop back this Monday. We will make all the posts visible and announce the winners.

 

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BigBob

BigBob

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U.S. Congress passed the Legal Tender Act, authorized the use of paper notes, called "greenbacks", to pay the government's bills. Green ink used on the back of the notes and had the wording :

The United States of America will pay to the bearer on demand ___ dollars . . .

 

This note is a legal tender at its face value for all debts public and private except duties on imports and interest on the public debt

 

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just-john

just-john

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In 1961, Lincoln and his secretary of the treasury, Salmon T. Chase, went to New York to apply for the necessary loans.

The Money Changers anxious to see the Union fail, offered loans at 24 to36% interest.

Lincoln said, thanks, but no thanks and returned to Washington.

Lincoln sent for an old friend colonel Tailor of Chicago, and put him on the problem of financing the war.

During one meeting Lincoln asked Tailor, what discovered.

Tailor put it this way: "Why, Lincoln, that is easy: just get Congress to pass a bill authorizing the printing of full legal tender treasury notes ... and pay your soldiers with them and go ahead and win your war with them also."

When Lincoln asked if the people of United States would accept the notes Tailor said: "The people or anyone else will not have any choice in the matter, if you make them full legal tender. They will have the full sanction of the government and be just as good as any money; as Congress is given that express right by the Constitution."

So that's exactly what Lincoln did.

In 1862-63 he printed up $450 million worth of the new bills.

In order to distinguish them from other bank notes in circulation he printed them in green ink on the back side.

That's why the notes were called greenbacks.

With this new money Lincoln paid the troops and bought their supplies.

During the course of the war nearly $450 million worth of greenbacks were printed at no interest to the federal government.

Lincoln understood who is really pulling the strings and what was at stake for the American people.

This is how he explained his rational: "The Government should create, issue and circulate all the currency and credit needed to satisfy the spending power of the Government and the buying power of the consumers.

The privilege of creating and issuing money is not only the supreme prerogative of Government, but is the Government 's greatest creative opportunity.

By the adoption of these principles... the taxpayers will be saved immense sums of interest. Money will cease to be master and become the servant of humanity." Abraham Lincoln

A truly incredible editorial in The London Times explained the central bankers attitude towards the greenbacks: "If this mischievous financial policy, which has its origin in North America, shall become endurated(?) down to a fixture, then that Government will furnish its own money without cost. It will pay off debts and be without debt. It will have all the money necessary to carry on its commerce. It will become prosperous without precedent in the history of the world. The brains, and wealth of all countries will go to North America. That country must be destroyed or it will destroy every monarchy on the globe." Times of London

(01:24:19)

The scheme was effective.

So effective that the next year, 1863, with federal and confederate troops beginning to mass for the decisive battle of the war, and the treasury in need of further congressional authority to issue more greenbacks, Lincoln allowed the bankers to push through the national bank act.

These new national banks would operate under a virtual tax-free status and collectively have the exclusive monopoly power to create the new form of money banknotes.

Tough greenbacks continued to circulate, their numbers were not increased.

But most importantly, from this point on, the entire U.S. money supply would be created out of debt, by bankers buying U.S. bonds and issuing them for reserves for banknotes.

As historian John Kenneth Galbraith explained it: "In numerous years following the war, the federal government ran a heavy surplus. It could not [however] pay off its debt, retire its securities, because to do so meant there would be no bonds to back the national bank notes. To pay off the debt was to destroy the money supply." John Kenneth Galbraith

 

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Moon

Moon

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QUESTION:

 

During the Civil War, Abraham Lincoln needed money to finance the war, so he ordered the printing of $450 million in full legal tender. What distinct difference did these notes have to distinguish them from other notes that were not fully backed by the U.S. government?

 

ANSWER:

 

Green ink was used on the back. This is the where the term “Greenbacks” comes from.

 

 

Congratulations to our 1st place winner dan8402! You will receive a coupon for 1 free standard grading.

 

Congratulations to our runner up winner bsshog40! You will be receiving a PMG Bank Bag and a sample.

 

 

Thanks for playing this weeks Numisma-Quest. Dont forget to stop by for this weeks NGC question!

 

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rrantique

rrantique

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QUESTION:

 

During the Civil War, Abraham Lincoln needed money to finance the war, so he ordered the printing of $450 million in full legal tender. What distinct difference did these notes have to distinguish them from other notes that were not fully backed by the U.S. government?

 

ANSWER:

 

Green ink was used on the back. This is the where the term “Greenbacks” comes from.

 

 

Congratulations to our 1st place winner dan8402! You will receive a coupon for 1 free standard grading.

 

Congratulations to our runner up winner bsshog40! You will be receiving a PMG Bank Bag and a sample.

 

 

Thanks for playing this weeks Numisma-Quest. Dont forget to stop by for this weeks NGC question!

 

Are you sure. ????

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