The monetary value of the greenback, which was printed using green ink on one side, fluctuated as the war progressed. At the start of 1864, when Union prospects were slim, the greenback dollar held a value of below 40 cents; by the end of the war in 1865, it was around 67 cents. The original intention was for the greenbacks to hold the same value as regular gold-backed notes, but that result never occurred.

Financing the cost of fighting the Civil War had a financial burden; so the federal (Union) government in 1862 began printing legal tender notes. This currency was not backed by specie (gold or silver) and exerted an inflationary impact on the Northern economy. By end of the war about $450 million was in circulation.

Pressure from business interests and creditors in the postwar period led to an effort to retire the greenbacks. These forces did not want to receive payments in cheap money and opposed any government policy that would lead to inflation. However the greenback prevailed…