The Confederate government issued bonds during the Civil War to raise money for the war effort. When the war ended and the government dissolved, the U.S. government refused to cover Confederate debts, making the bonds worthless as debt instruments or market securities. However, collectors still buy and sell Confederate bonds, and a bond in good condition may hold value as a collectible.
Original Face Value
The Confederate government and local governments across the South issued millions of dollars of war bonds during the Civil War. Bonds with a face value of $50 to $20,000 were advertised with an annual interest rate of at least 4 percent. The bonds could be redeemed in cash or cotton, and many planters and English cotton importers purchased the bonds, some in sympathy with the war effort and some as an investment.
Worthless Securities
Bondholders succeeded in collecting interest for only a few years, and very few ever saw their principal again. By the end of the war, the South was mired in debt and the federal government refused to pay creditors, including bondholders. If that declaration had doubters, a court settled the matter in 1924 by declaring $120 million in bonds held by wealthy Britons worthless. The bonds have no value as financial instruments today.
Collectors Items
Collectors still find value and interest in Confederate bonds as pieces of financial history and Civil War memorabilia. The Antique Trader newsletter notes that few bonds sell for more than $100, and those that do are in exceptional condition and feature rare signatures or designs. Even with prized features, prices are highly subjective.
Establishing a Collectible Price
Pricing Confederate bonds as collectibles depends primarily on how much a small pool of buyers is willing to pay based on the recent prices of similar bonds, the type of bond and its condition. One of several published field guides -- such as "Collecting Confederate Paper Money Field Guide" or "The Civil War Price Guide," which maintains a pay-to-use online database -- can assist in pricing.