In 1848, for the first time in history, an accidental discovery in California gave everyone and anyone the chance to get rich thanks to gold. It all started in 1839 with John Sutter, an ambitious immigrant from the village of Kandern in Germany.

Sutter settled in California and decided to create an agricultural empire on the fertile hills around the Sacramento valley. It was here that he built a fort in order to protect his rapidly growing assets. Nearly ten years later, he owned 1,200 head of cattle and employed over 100 people.

He also had plans to build a flour mill in order to supply the needs of the people who came to settle in the west. Sutter needed wood to do this.

James Marshall arrived at Sutter’s Fort in 1845, at the age of thirty-four, and was immediately hired as a handyman by Captain Sutter. Anxious to get back to farming, Marshall bought a ranch on Butte Creek but continued to work for Sutter.
Marshall fought in the Mexican War, serving in Captain John Frémont’s California Volunteers for one year. When he returned to Sutter’s Fort in 1847, he was dismayed to find that all his livestock had either strayed off or been stolen. He had no choice but to go back to work for Sutter.  Sutter contracted him to build a saw mill and Marshall found a suitable location in the Nevada foothills some 40 miles from Sutter’s fort near an Indian village called Cullumah (Coloma)

The workers had to dig a big trench to bring water to the saw mill and the deepest part of the trench, called a race, was at the level of the land’s sub-strata. It was here on the morning of January 24^th 1948 that James Marshall was making his routine inspection when he made a discovery that would change the course of Californian and American history.

The flowing water had carried away sand and dirt and lighter minerals, but a heavier metal was left behind to accumulate in the deepening ditch. Marshall hesitated twice before taking the trouble to bend down and pick it up. “I sat down and started some serious thinking, my heart was beating strongly, I was certain it was gold. The piece had the shape of a small pea”.

Marshall ran some crude test to determine the authenticity before returning to show Sutter who would later write: “Mr. Marshall started by showing me this metal. In reality, some small fragments and pieces, some of which could be worth a few dollars He told me that he had told the workers at the saw mill that it was possible that it was gold.”

Sutter decided to keep the find secret until one of his workers went to town to have a drink without any money on him. Once there, the worker searched his pockets and brought out a gold nugget that he had found in a stream; he slapped it down on the counter. ”Here’s some money, it’s gold” he said. The transaction took place in the general store owned by a Mormon called Sam Brannan who knew a bit about supply and demand at the frontier.

Sam Brannan saw an opportunity and  went to San Francisco and bought everything that he could get his hands on to supplies the miners would need over the following months. Then Brannan did everything to ensure that crowds of miners were attracted. He wandered around the streets of San Francisco announcing the new discovery: “Gold in an American river! Gold in an American river! ”

When the news reached the state of Oregon, two thirds of working men packed their bags and headed for California. They claimed to be gold prospectors. Finding the metal became a new trade. A Spanish official at Monterey commented: “farmers have left their ploughs, lawyers their cases, doctors their tablets, priests their flocks and everyone is now digging for gold”.

The news spread even faster by sea, the Chinese knew before the New Yorkers. “The news took so much time to reach the east of the country that these people were known as the 49ers, from 1849, instead of the 48ers.”

In 1852, the population of California had more than doubled as 250,000 people arrived. Virtually the whole world had participated in the gold rush. You can read in the registers that people came from the Indian sub-continent and from every country in Europe but also from Australia, South America and, of course, the United States.

There were three possible routes to the gold bearing lands for the approximately 80,000 Americans who left the east coast. By train the journey could take up to six months. By ship, going around South America, it could also take six months. Or there was the combined ship and land route, crossing the panama isthmus; the shortest route and also the most expensive.

These three solutions all produced great suffering; there was hunger and terrible diseases plus many other dangers. We should not forget the bad country and the fear, worries not only for the family left behind but also about what you would find to live on in California.

When the ships moored in San Francisco, the sailors, tempted by the chance of earning twenty years of salary in just two months as prospectors, joined the passengers and accompanied them in this rush to the gold fields. The SS California arrived in April 1849 with a crew of 36. After only a few days, the only people left on board were the captain and a mechanic. Another ship’s captain went so far as to hang two deserters from the yardarm until inches from death as a warning, but to no avail. The gold fever had made everyone mad.

It was the chance of a lifetime for many people who had known nothing but poverty and had suddenly heard of this extraordinary news.

Before the find at Sutter’s saw mill, any gold that had been found immediately became the property of kings or conquerors. The Californian gold rush introduced a new facet or, to put it simply, allowed common people to search for gold and keep whatever they found for themselves.

All of a sudden, there were independent miners who managed on their own in the cold and rain, who broke their backs as they extracted and searched the gold-bearing gravel. It’s completely unique in the world’s history.

The 49ers worked a rocky region that was rich in gold which was referred to as the mother-lode. Over the course of millions of years, the gold had been carried by streams until it reached the river; this is why we talk about gold-bearing sand or gravel.

However, even though California was inundated with gold, money was scarce, the nearest place to obtain money was Philadelphia on the other side of the country. The Californians therefore has to improvise and used the foreign coins that were already present.

The Spanish silver dollar, called a piece of eight, was the most common; they could to be cut into eight smaller pieces with each of them worth 12.5 cents. e.g. six bits would buy you a haircut and a shave.

However, David Broderick, recently arrived from New York, started buying the gold dust which he melted into gold coin that  allowed the Californians to develop a reserve of money that became indispensable. It was only later that it was discovered that the so-called 5 and 10 dollar gold coins were possibly not made entirely of gold, thus Broderick to make a good profit from his business.

Broderick was not the only trader to make his fortune without ever touching a rock. At the height of the rush, Sam Brannan, who supplied all the miners, became the country’s richest man. Sam Brannan is known as the first millionaire: a million dollars in gold dust without ever having swung a pick.

However, only a handful of the 49ers got rich from the adventure. In 1849, California produced 10 million dollars of gold, when split between an average of 40,000 miners, this is about 250 dollars each. But people kept on coming by hundreds and thousands, attracted by the extravagant stories told about the rush.

Production reached 77 tonnes in 1851. Most of it left for the east of the country – an annual cargo which had a value that was greater that the whole of the federal budget. Production reached 93 tonnes in 1853 but the easy gold that could be panned in the rivers and streams had now virtually run out, the bell had tolled for the end of the Californian gold rush. The adventure only lasted for four short years but was fundamental for the future development of the American west.

It had had a scale, it was far greater than any other event of its type in history of America, not only in terms of the quantity of gold extracted but also for what it did for America. Those miners who realised that chasing gold was a pipe dream went back to doing what they did best and established productive  farms in California’s fertile land.

As with all the history of the American west, development has a cost. The massive immigration upset an economic and social system that had been stable for many years. The different routes to the gold had devastating effects on the native Indian populations, it was the beginning of the end of their way of life.

Over a five year period, the Californian Indian population fell from 150,000 to less than 30,000 people. Most died of hunger or disease, others were killed by miners.

Those who started the rush had similar fates: James Marshall, the man who found the first nugget in the river, spent the rest of his life a drunkard as he searched in vain for another seam

John Sutter’s prosperous agricultural empire disappeared. His workers went out into the gold fields and abandoned the land to squatters. Sutter refers to his broken dreams in his memoires: “This sudden gold find destroyed all my best plans, if only I had succeeded a few years before gold was found I would have been the richest person on the Pacific coast. But instead of being rich, I am ruined.”

Some 49ers were unable to get over their gold fever. In the next half century, there were several other gold rushes around the world. Each of them triggered a migration of prospectors stimulated by the simple rumour of the next great find.

In the gold fever, a ruined 49er found gold under the ground. The main gold seam that supplied the great Californian gold rush, the mother-lode as it is called, is in reality a vein of quartz containing gold that extends over 160 km across the mountains of northern California.

In 1850, Edward Hargreaves, aged 34, returned home to Australia after having spent two years there searching for gold in California. Even though he was now penniless, Hargreaves realised that the geology of the Californian region where he had been was similar to that in New South Wales in Australia. He forecast to one of his fellow travellers that he would find gold within a week. “There is as much gold in the country I am returning to as there is in California. And her gracious majesty the queen, blessed by God, will name me as one of its gold high-commissioners.”

Hargreaves was not far from the truth. In 1851, barely six weeks after his return, accompanied by a guide who’s service he had rented, discovered gold in his pan. In six months, some 50,000 prospectors, most of them ex-Californian dreamers, had descended on Australia.

A few months later, the news of the find reached England along with the first cargo of Australian gold.
Thomas Harvernot, the steamship’s captain, wrote: “Our colony is totally paralysed. Every man or boy capable of holding a shovel has already left or is leaving to dig. The price of almost every foodstuff has increased by as much as two hundred percent.”

Australia, which had been detested as a penal colony for  British convicts, suddenly became the promised land for anyone who had a dream and a shovel. 372,000 immigrants settled there in1852. They were simply ordinary people who said to themselves “it’s a gold rush, let’s get up, let’s go there and see if we can get rich.”

But as was the case in California, the Australian gold rush did not last long. Over four years, all the gold hidden on the surface and in the water courses was cornered. Edward Hargreaves boast became a reality. Queen Victoria named him High-Commissioner of the Lands. Apart from a payment of 10,000 pounds sterling, she also gave him a job for life. Even though he never found any more gold, Hargreaves continued to be venerated as the man who had the gift of changing everything he touched into gold.

The Californian and Australian gold rushes made common people into part-time prospectors. I suppose that it had almost become a semi-profession by the second half of the 19^th century. You were a prospector, your ear was always cocked to hear the latest gossip and discussions that circulate in bars.

With California and Australia now out of play, the ultimate advice was “go to the Rockies”. Watch this space…

Maurice Hall

Tags: DOLLAR, Gold, Money

This entry was posted on Monday, December 28th, 2009 at 1:45 pm and is filed under Gold, Mining, Money, USA. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.