Why did people sell there war bonds during the American revolution?

Answer 1

War bonds were a very simple method for the government to make money. At the time, most of the wages Americans were getting were from making the things the government was spending money on, so they encouraged civilians to put that money back into the war effort.

Answer 2

Liberty Bonds were a way for the government to earn money to finance participation in World War I. They sold the bonds to the American people and promised to repay the cost, with interest, within a certain amount of time.

Answer 3

The bonds were collateral for the war loans taken out by the US Treasury. Here is a simple explanation of a more complex process. The people buy One million Dollars in bonds. The US treasury then goes to the banks and says we have one million dollars. We need more than that but we will take one million dollars. Now they can surrender the one million over now or pay it later. They choose to borrow the one million dollars and the bonds are held in collateral. Then The bank earns interest on the one million dollars in held in bond. They get paid back by the US government. The people who come back later to collect their war bond earnings. The money they paid is returned along with interest. The Bank however keeps back a portion of the interest for themselves.

So the US raised billions of dollars in the War Bonds and had a continuous flow of dollars to use to make the war effort work out. The Banks made money and the US War bond buyers earned money too.

It really is much more complicated but you get the basic idea that the war bonds raised a lot more money than taxes could ever raise for the war effort.