I agree, somebody conversant with economics would have to chime in & give us a tutorial on the effect of counterfeiting. I know that here in Middle Tennessee all commerce was done in U.S. Dollars after a certain point because they were trusted. One of the unintended consequences of the war was the adoption of a national currency.
Weidenmier, Marc D. “Bogus Money Matters: Sam Upham and His Confederate Counterfeiting Business.” Business and Economic History, vol. 28, no. 2, 1999, pp. 313–324. JSTOR, www.jstor.org/stable/23703341. Accessed 16 July 2021.
Money & Finance in the Confederate States of America, an article by Marc Weidenmier of McKenna College, is the best history of the CSA economy I have found. Here is a summery of the pertinent parts:
'Confederate Money Prices in Richmond 1861-1865.'
A graph shows the conversion rate of Graybackss for gold. Following defeats at Antietam, Gettysburg, etc. prices depreciated. I find it strange that the US Conscription/Finance Bill that established the financing for the war & pay for drafting soldiers caused a dip in the value of the Graybacks. The final breaking point was in the late spring of 1864 when the CSA gov't repudiated 1/3rd of the money supply with a currency reform act. New bills were cranked out in volume again in the fall of 1865. From that point, Graybacks deprecated until February 1865 when gold dealers packed up & left Richmond.
'Counterfeit Money & the Yankee Scoundrel'
It is hard for scholars to pin down the exact effect of counterfeit Graybacks because there are no hard numbers. However, during the war & after it has been noted that bogus money used a serious problem for the Confederacy. More money chasing the same number of goods created inflation. A contributing factor in the CSA's currency problem was the lack of sophisticated printing equipment n the South. It was often quipped that the best way to detect a counterfeit note was by its higher quality than government issued currency.
Scholars cite Upham as having produced 15,000,000 in bogus rebel notes. He had a mail order business & placed adds in Louisville & St. Louis. Smugglers used Uphman's Graybacks to purchase cotton. Confederate Treasury Secretary Memminger made the following comments abut the "Yankee Scoundrel" in June 1862.63,
"Organized plans seem to be in operation for introducing counterfeiting among us by means of prisoners & traitors, & printed advertisement have been found stating that the counterfeit notes, in any quantity, will be forwarded by mail from Chestnut Stree (Upham's address), in Philadelphia to the order of any purchaser."
President Davis placed a $10,000 bounty on Upham. It has been suggested that Secret Service agents protected Upham.
Between June 1862 & August 1863, Upham printed between 1.5 & 2.5 % of Confederate currency. At that point, Confederate money had depreciated so much that it was no longe accepted as a medium of exchange by smugglers. Given that Upham was one among many, it is safe to assume that bogus money had a large impact on Confederate price levels. It fueled Confederate inflation via a large increase in money stock.
Taht is my summery of the pertinent sections of the article. I found the clearly written essay very illuminating on a subject I was profoundly ignorant about & recommend it to all our contributors.