The Confederacy and the Union had different economic statuses, the Union was more stable than that of the South thanks to the success of bond sales, its form of more reliable wealth and to the fact that it was a pre-established country with experience of wartime financing. Although the Union's banking system was far from perfect, its superiority placed the Union financially ahead of the South. The Union developed a technique that increased bond sales, while the South earned very little from their sales. This was due to both the scarcity of cash in the South and the reluctance of Southerners to invest in bonds. Deficiencies in the South's war financing tactics triggered runaway inflation that reached 9,000 percent in 1865. Another point of the South's inferiority was the fact that its government was developing as the conflict broke out, while the North had the advantage of being a pre-existing country with previous experience. raise funds for other wars. This, combined with both the Confederation's size and illiquid assets, attributed to its economic decline. The South, predominantly agrarian, had few forms of liquid wealth; slaves and land made up the bulk of the southern capital. The cultivation of cotton and the profits made from its sale were critical to the economy, and so, with the loss of northern buyers, the economic status of the Confederacy was doomed to failure. The poor economic situation in which the Confederacy found itself definitively influenced its success in the Civil War, and demonstrated its inferiority as a developing country. First paragraph: The Union had fewer inflation problems because its bonds performed better. a) The bonds, who established them, who had them first, were the first American war bonds) The Union raised a higher percentage of its money from bonds than the South; the South simply inflated without species support because it had a smaller and less industrial economy. Jay Cooke, the man appointed by Salmon Chase to administer Union bond sales, developed a technique in which he sold bonds not only to the wealthy classes, but also to the middle classes, encouraging them to contribute to the war effort by purchasing bonds. . This tactic raised $3 billion for the Union. The Confederacy's attempt to raise war funds with bonds failed primarily because few Southerners had enough cash; as mentioned above, liquid wealth in the South was rather scarce. Another reason for the Southerner's reluctance was inflation.