We called it "Cowboys and Indians". That's even worse, 'cause the Indians always lost. We used "cap" guns. They used a roll of paper with little balls of gun powder in the roll that would pop when struck by the hammer of the real sized gun. We could make a real bang by striking the whole roll with a hammer.
Amazingly, you can still buy caps and cap guns on Amazon and elsewhere:
http://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Daps&field-keywords=cap+gun
http://www.tintoyarcade.com/cap-guns-and-caps?gclid=CJGO9aHq8MQCFZM9gQodsRwAGw
Ah, caps. If your cap gun wasn’t working, you could sit on the sidewalk and hit the caps with a rock. Or you could ignite them with a flick of the thumbnail; they wouldn’t go bang, but you got a flash and a puff of that wonderful-smelling smoke. A session of this usually ended when the burning powder from a cap lodged under your thumbnail.
And yes, hitting one or more rolls with a sledgehammer made a grand bang. Probably what caused at least part of my tinnitus.