The government of Great Britain receives the official news that the U.S. would release Confederate envoys James Mason and John Slidell, thus averting an international crisis.
Abraham Lincoln tries to coordinate action in the Western Theater, but his generals are reluctant to comply.
Thomas J. “Stonewall” Jackson’s Confederate army begins moving out of winter quarters at Winchester toward the Potomac River as part of Jackson’s plan to capture Romney.
The year closes with southerners optimistic about gaining independence and northerners pessimistic about preserving the Union.
“Stonewall” Jackson issues orders for his Confederates to begin marching on New Year’s Day. Only Jackson knows that his men are about to embark on a grueling march to Romney in Virginia’s Shenandoah Valley.
The suspension of specie payments by the leading northern banks plunges the North into a financial crisis as the year ends.