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<p>[QUOTE=&quot;NormW, post: 2200578, member: 46682&quot;]I thought we didn&#039;t have federal notes until 1863 but I just found this article:</p><p><br /></p><p><font size="4"><b>Demand Notes[<a href="https://en.wikipedia.org/w/index.php?title=United_States_Note&amp;action=edit&amp;section=2" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/w/index.php?title=United_States_Note&amp;action=edit&amp;section=2" rel="nofollow">edit</a>]</b></font></p><p>Main article: <a href="https://en.wikipedia.org/wiki/Demand_Note" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/wiki/Demand_Note" rel="nofollow">Demand Note</a></p><p><a href="https://en.wikipedia.org/wiki/File:Demand_Legal_comparison.jpg" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/wiki/File:Demand_Legal_comparison.jpg" rel="nofollow"><img src="https://upload.wikimedia.org/wikipedia/commons/thumb/4/42/Demand_Legal_comparison.jpg/240px-Demand_Legal_comparison.jpg" class="bbCodeImage wysiwygImage" alt="" unselectable="on" /></a></p><p>Comparison of a $5 Demand Note (upper image) and an 1862 issue $5 United States Note (lower image). Note the removal of the words &quot;On Demand&quot; and of the phrase &quot;Receivable in Payment of All Public Dues&quot;. Also note the Treasury Seal added to the United States Note.</p><p>During 1861, the opening year of the American Civil War, the expenses incurred by the Union Government far outstripped its limited revenues from taxation, and borrowing was the main vehicle for financing the war. The Act of July 17, 1861<a href="https://en.wikipedia.org/wiki/United_States_Note#cite_note-2" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/wiki/United_States_Note#cite_note-2" rel="nofollow">[2]</a> authorized <a href="https://en.wikipedia.org/wiki/United_States_Secretary_of_the_Treasury" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/wiki/United_States_Secretary_of_the_Treasury" rel="nofollow">United States Secretary of the Treasury</a> <a href="https://en.wikipedia.org/wiki/Salmon_P._Chase" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/wiki/Salmon_P._Chase" rel="nofollow">Salmon P. Chase</a> to raise money via the issuance of $50,000,000 in <a href="https://en.wikipedia.org/wiki/Treasury_Note_(19th_century)" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/wiki/Treasury_Note_(19th_century)" rel="nofollow">Treasury Notes</a> payable on demand.<a href="https://en.wikipedia.org/wiki/United_States_Note#cite_note-Greenbacks-3" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/wiki/United_States_Note#cite_note-Greenbacks-3" rel="nofollow">[3]</a> These Demand Notes were paid out to creditors directly and used to <u>meet the payroll of soldiers in the field.</u> While issued within the legal framework of Treasury Note Debt, the Demand Notes were intended to circulate as currency and were of the same size as banknotes and closely resembled them in appearance.<a href="https://en.wikipedia.org/wiki/United_States_Note#cite_note-4" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/wiki/United_States_Note#cite_note-4" rel="nofollow">[4]</a> In December 1861, economic conditions deteriorated and a <a href="https://en.wikipedia.org/wiki/Demand_Note#Suspension_of_Specie_Payment" target="_blank" class="externalLink ProxyLink" data-proxy-href="https://en.wikipedia.org/wiki/Demand_Note#Suspension_of_Specie_Payment" rel="nofollow">suspension of specie payment</a> led the government to cease redeeming the Demand Notes in coin.</p><p><br /></p><p>I didn&#039;t know about these 1861 demand notes.</p><p>I guess that answers my question.</p><p>Thanks[/QUOTE]</p><p><br /></p>

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