News & Tall Tales. 1800s.
April 29, 1850, Placer Times, Placer County, California
Effects of the Influx of California Gold Upon Business.
In the March number of Hunt's Merchant's Magazine, we find the following remarks on this topic:
"It is the case that the gold received into the country from California is beginning to affect general business to a considerable extent. Thus last year from all towns and sections of the Union, adventurers for California were fitted out with all the means themselves, relatives and neighbors could command. To do this, debts were deferred, and purchases of goods economised. This has now began to react, and the remittances of those adventurers are now enabling debts then contracted to be paid, and those in straightened circumstances to improve. Thus an express house reports that of over 500 distinct remittances made through them, over 200 were to female relations of absent, diggers. Thus the product of California finds its way into the channels of trade, from the several homes of adventurers, producing the same effect as if it had been produced in the United States. From these sources it finds its way back to the great reservoirs. Of the $12,000,000 received into the country up to this time, at least $6,000,000 has been to different families scattered in the interior.
And as by far the larger portion of this has been procured by those who left home, because their services then were unproductive, it has very nearly the same effect as if they had produced and sold as much farm produce extra. This money going back to the hands of merchants in exchange for goods, naturally produces a gradually increasing abundance. This is daily more perceptible; as the season advances, business paper has become scare at 7 percent "at call," on government stocks 5, and in some cases less is obtained.
It is the case that last year, when the winter set in, there were comparatively very few men in the diggings. Where there were then 1,000 there are now 10,000. These are all crowding down into the cities with the gold they have, and in so doing will bring away as many of the fleet of vessels as can be victualed for the voyage.
Many others will, with their gains, by the usual route, and those who remain will require considerable supplies, to supply which, good have been very actively going forward, and for which gold will return in increased quantities.
That prices of goods, generally will improve here, until the increasing abundance of gold passes off, seems probably; but the same general influence seems at work in England, where prices are, perhaps, generally more buoyant than here, causing a continued demand for United States produce, as well cotton and tobacco as farm produce.
We extract the following from the article in the N. Y. Herald of March 10th:
The aggregate value of gold dust received up to this time, from California, does not vary much from thirteen millions of dollars. Nearly the Whole of that large amount has been added to the metallic currency of the country, and will serve as the basis of individual credit for at least one hundred millions of dollars. The returns of gold have not, therefore, been so limited as anticipated, in proportion to the value of merchandise exported to that country.
If we estimate the value of vessels dispatched to California, their cargoes, costs of outfits of passengers, etc. etc. we should find that full one hundred millions of dollars have already been invested in that trade, and in expeditions to that country, of which about thirteen millions hare been returned in gold dust. In other words, we have been furnished with a capital of $13,000,000 from California, from which we have done a business of $100,000,000. This is not, after all, a very great expansion of credit, as a large portion of the property sent out is profitably employed in the Pacific, and the capital invested probably in more active operation than it would have been on the Atlantic. There is an immense field in that portion of the world for the profitable employment of a large commercial marine, and for a long time vessels must be supplied from this side of the continent. California has, on the whole, paid up pretty well thus far, and there is very little danger but that we shall ultimately find that trade with that country, not only highly profitable, but the payment prompt and in the shape most desirable. We shall not receive any very large amounts of gold from California until the digging season again commences.
The San Francisco money market, at the last accounts, was tight, and the rate of interest ruled so high there, that much gold that would otherwise come here, will probably be loaned out in California, The rapid increase of business in San Francisco requires a great increase in the currency.
. . . England has only the eclat of a power everywhere undermined, and which exists by means of its mass, rather than its real strength. Besides, the Union has the attractions of youth and fortune, while England bears on her the ineffaceable traces and the ill fortune of decline. The Star of Britain everywhere has paled, when in conjunction with that of America and now, when the latter is rising in splendor above the Pacific, the former cannot hope to eclipse it."
Practicing Law in Frontier California (Law in the American West)
Gordon Morris Bakken
The author combines collective biography with an analysis of the function of the bar in a rapidly changing socioeconomic setting. Drawing on manuscript collections, Bakken considers hundreds of men and women who came to California to practice law during the gold rush and later, their reasons for coming, their training, and their usefulness to clients during a period of rapid population growth and social turmoil. He shows how law practice changed over the decades with the establishment of large firms and bar associations, how the state's boom-and-bust economy made debt collection the lawyer's bread and butter, and how personal injury and criminal cases and questions of property rights were handled. In Bakken's book frontier lawyers become complex human beings, contributing to and protecting the social and economic fabric of society, expanding their public roles even as their professional expertise becomes more narrowly specialized.