As you read these words it is the 150th anniversary of December 1861. The Civil War was in progress that year, having begun in April with the bombardment of Fort Sumter by Confederate forces. The War of the Rebellion, as it became called, was viewed as a quick event. For sure, the industrialized North could easily vanquish the South with its agricultural emphasis. President Abraham Lincoln called for volunteer troops to sign up for a three-month enlistment.

Reality proved to be somewhat different on July 17, when at the Battle of Bull Run in Manassas, Virginia, not far from the nation’s capital, the first major encounter between Confederate and Union troops resulted in an overwhelming defeat for the Union side. Soldiers broke apart and retreated toward Washington in scattered groups. It was obvious that the war would not be over in three months. A prolonged conflict was in the offing.

By December it became evident that a Union victory was not at all assured anytime soon. In fact, the Confederates might win. Speculators and hoarders went to banks toward the end of the month and withdrew a lot of gold, after which banks stopped paying out coins in this metal. They were still available from exchange brokers, but a premium had to be paid for them in terms of silver coins. As it turned out, gold coins would remain out of general circulation in the East and Midwest not only through the Civil War, but onward, until December 17, 1878.

More next week!

At top left: A double eagle of 1861. This was the last year that gold coins were seen in commerce in the East and Midwest, until years later in December 1878.