George,
I think we can both agree that this is not a traditional pennant because of it's dimensions don't match those associated with historical naval pennants be that US, CS or even UK (Flags at Sea, Timothy Wilson). From my point of view in studying US flags and flag catalogs the wreath of twelve stars with the larger thirteenth star in the center was and still is a common patriotic motif especially with pull down banners. Obviously, those of us familiar the 1st national Confederate States flag would see the similarities. It is interesting that the grommets are steel and not brass. I have a 48 star US flag the has the same steal grommets which could be from the WWII period when brass was used for the War effort.