What were Greenbacks during the Civil War?

Greenbacks were a type of paper currency issued by the United States during the Civil War that were not backed by gold or silver, which means they were fiat money. This situation arose due to the urgent need for funding to support the war effort against the Confederacy. The federal government needed a way to finance the war without relying solely on taxes or loans, and thus introduced this currency to help stimulate the economy and pay for military expenses.

The decision to issue Greenbacks reflect the broader economic strategies employed during the Civil War as the government grappled with financial instability. Greenbacks aimed to provide liquidity and economic flexibility, despite concerns about inflation and value since they were not backed by a precious metal. Their introduction marked a significant shift in monetary policy during this turbulent period in American history.