1862 $1000 United States Five-Twenty Bond Hessler X-130D PCGS About New 53.. ...

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The Money That Won The Civil War

1862 $1000 United States Five-Twenty Bond Hessler X-130D PCGS About New 53.
This incredible example of the famous "Five-Twenty" bond is, to our best knowledge, the only surviving signed and issued "Five-Twenty" bond extant. It comes from the estate of a long deceased banker in upstate New York who had this item hung over his desk with the caption "The Money That Won the Civil War," which is as apt a description of this item as we can imagine. The Five-Twenties were the method the Union used to finance the war effort, and, as the war progressed, became a means of harnessing popular sentiment in the North by encouraging the public to invest in these bonds and thereby hold a financial stake in the success of the Union army on the battlefield.
When war with the South broke out in the Spring of 1861, the finances of the Federal government were in precarious shape. As the scope of the conflict became more clear, the Federal government realized that the costs of equipping and arming their newly raised forces far outstripped the resources on hand, leaving printing money or borrowing as the only alternatives. The former was accomplished with the advent of the so-called Greenbacks, which were made Legal Tender without any metallic backing, and the latter with the creation of the Five-Twenties, which could be paid for with Greenbacks and raised money directly from the public. Eventually there were four separate issues of Five-Twenties, which received their nickname because they were callable after five years but at the pleasure of the government payment could be delayed for up to twenty years, with the bonds paying 6 percent interest per annum. When the bonds first became available, Secretary of the Treasury Salmon P. Chase arranged to place them with brokers, but few were sold. Chase then approached Jay Cooke of Philadelphia, and Cooke and Company proceeded to sell hundreds of millions of dollars of Five-Twenties during the course of the war, with massive bond rallies held in most northern cities and towns. In fact, it is estimated that as much as five percent of the northern population invested in these bonds, which had a face value of as little as $50, an amazing feat in a country where fewer than 1 percent of the population even maintained a bank account.
This $1000 bond is, as we said earlier, the only signed and issued Five-Twenty of any denomination we have ever seen or heard of. It was issued on August 10, 1863 and came from the first issue of Five-Twenties, and was redeemed in 1869. It is punch cancelled at the bottom, but is otherwise in well nigh perfect condition. Any estimate here is simply a wild surmise, as we saw last year when we estimated a unique signed and issued 1847 US Treasury Note grading Very Fine 25 for $30,000 to $50,000 and saw the hammer fall for $199,750. We will be conservative once again, but, considering the historical importance of this item, would not be at all surprised to see our estimate easily surpassed in the first few moments of the bidding.