
James Marshall began 24 January 1848 by walking down the tailrace below the mill to inspect the bottom, after having been sluiced out the night before and closed earlier that morning. The lower end of the race was shallow and a more rapid runoff was needed for the new sawmill that Marshall was building for John Sutter on the south fork of the American River. Workmen had dug and blasted the day before and the rushing water over the night had carried much of the debris and rocks away.
The early morning sun brought out the glitter of something on the bedrock bottom of the race and caught Marshall's eye. He reached over to pluck the glittering stone and held it up for closer inspection. A wave of excitement flushed through him as Marshall realized he had discovered gold. His eyes quickly danced around the bedrock and sure enough there were more "glitterings" to behold. Some were mere flakes, others larger in size. Marshall took off his slouch hat and began collecting specimens. Before long, Marshall was running back to the mill in an excited state shouting "Boys, by God, I believe I've found a gold mine."
Marshall's shouts were greeted with curiosity and skepticism. His Mormon workmen were finishing their breakfast. One of them, Azariah Smith, pulled out a five-dollar gold piece from his mustering-out payment when he was discharged from the Mormon Battalion, and compared the color to the tiny pieces on Marshall's hat. Sure enough, the color was right. The larger golden pebbles then passed the anvil test. Soon, the four Mormons and Marshall were walking down the race looking for more. It was there for the finding.
Mrs. Elizabeth Wimmer, the camp housekeeper, later in life recalled that she put a nugget in a kettle of lye that she was boiling for soap-making, left it there all day and it did not tarnish.
All this excitement did not slow down the work on the mill. But for the next couple mornings, the men made a very thorough inspection of the race, collecting more gold specks and accumulating two or three ounces of gold for their efforts.

For Marshall, the excitement was too much. The gold fever had taken over. He gathered up the gold dust, pouring it into a one-ounce glass vial which he hastily wrapped in a cotton rag, and headed down to Sutter's Fort at New Helvetia, 40 miles away, to show John Sutter his find.
New Helvetia was a two-parcel land grant of 50,000 acres--one parcel at the junction of the lower Sacramento and American rivers, and the other parcel north along the Feather River--that Sutter had managed to secure from the then Mexican Governor, Alvarado, soon after arriving in San Francisco in 1839.
Sutter, a Swiss with an elaborately fabricated past of European nobility, had drifted around through a number of frontier settlements from Santa Fe to the Oregon Territory and Hawaii, leaving a trail of economic difficulties and never amounting to much. But somehow, he was able to pass himself off as a man of considerable significance with the Mexicans and was able to establish enough credit to finance an expeditionary force and chartered two small schooners, the Isabella and the Nichols, and a four-oared boat. They sailed across San Pablo Bay and headed for the mouth of the Sacramento River to establish his fiefdom.

At New Helvetia, Sutter had gotten a fresh start by setting up a center of simple industry on the frontier. With the help of the local Indians and his loyal Hawaiian Kanakas, along with some Californians and Americans, Sutter had brought in cattle, horses, and sheep, and planted an orchard along with a large ten-acre vegetable garden. He took great pride in his extensive wheat fields that he hoped would turn profitable some day. He had many projects going for him: a gristmill, a distillery, a blacksmith shop, a cannery, and a tannery, along with this latest sawmill venture with Marshall. Sutter ran a retail store at the fort offering all manners of goods. He also employed a number of mountain men to engage in the lucrative fur trade in beaver and river otter pelts.
He had chosen well the strategic location of his enclosed fortified headquarters, Fort Sutter, at the junction of the American and Sacramento rivers. It was the first welcome outpost of civilization for weary emigrants after their long trek over the Sierras.
John Sutter's world was about to be turned upside down with the unexpected January 28th arrival in the middle of a fierce rainstorm of the rain-soaked and muddied James Marshall with a crazed look in his eyes.
Sutter was well aware of the eccentricities of his sawmill partner, so he was not alarmed when Marshall burst in demanding to see him alone, behind closed doors.
The wild-eyed Marshall insisted that Sutter's office next to the guard house was not private enough, so Sutter led his rain-soaked partner to Casa Grande, his private quarters, where he shut the door and asked Marshall just what was on his mind.
Still nervous, Marshall asked if the door was locked. "No," replied Sutter, by now really wondering just what was going on, "but I shall gladly lock it."
After being assured that they were alone, Marshall demanded two bowls of water.
Sutter rang a bell and a servant came to fill the unusual request. Marshall then demanded a stick of Redwood, some twine and two sheets of copper with which to make some scales.
Anxious to move this strange event along, Sutter told Marshall that he had scales in his apothecary shop and left the room to get them, by now determined to get to the bottom of the matter. Sutter returned but neglected to lock the door behind him. Marshall pulled the white cotton rag from his pants pocket and began to unroll its contents when a clerk, unannounced, walked into the room. A startled Marshall quickly stuck the cotton rag back into his pocket and blurted out "Didn't I tell you we had listeners?"
Sutter dismissed the clerk, locking the door this time, and calmed down the agitated Marshall, who now drew the cotton rag from his pocket and pulled out the greenish vial of gold dust, saying "I believe this is gold."
Sutter examined the pebbles and grains from the vial and agreed that it looked like gold, as Marshall related the story of the discovery at the sawmill four days earlier.
"Let us test it," said Sutter and went back to the apothecary shop to get some Aqua Fortis, better known as nitric acid, which he applied to the golden pebbles to no effect. He then placed some silver coins to one side of the scale and an equal weight of the suspected gold in the other and submerged the scale ends into the water. Sure enough, the gold outweighed the silver and sank to the bottom of the bowl.
Sutter then reached for his Encyclopedia Americana to read an article about gold and was soon convinced that his wild-eyed companion was right and that the specimens were of at least twenty-three-carat purity. "I believe that this is the finest kind of gold," said Sutter as he closed the book.
The two men took an oath of secrecy. Marshall was still in his frenzied state and insisted that Sutter immediately accompany him back to the mill that night. Sutter thought better of that idea and told the wild-eyed Marshall that he would go up there the next day, just as soon as he had arranged his affairs. Reason finally did prevail upon Marshall, for he did reluctantly have dinner and passed out from exhaustion. He left for the mill the following morning.
Sutter spent a restless night tossing about in his bed wondering just what this chance discovery of gold held for him. He thought it strange that none of his Indians had ever brought him particles of gold, since he had long ago asked them to bring him any unusual things that they found in the mountains and he had always handsomely rewarded them for their efforts. Later on in his memoirs, he would reminisce "At once, and during the night, the curse of the thing burst upon my mind. I saw from the beginning how the end would be.... Of course, I knew nothing of the extent of the discovery but I was satisfied, whether it amounted to much or little, that it would greatly interfere with my plans."
On the morning of January 29, 1848, three boats arrived at New Helvetia that kept Sutter busy for the next three days and he was unable to get away. It was after dusk when Sutter and his Indian guide companion finally left the fort for what Sutter called his "melancholy ride" to the sawmill at Coloma on the first day of February, 1848. They made their way through the darkness to the flour mill at Natoma and camped for the rest of the night.
Sutter was up at dawn filled with apprehension but eager to get to the sawmill and learn his fate. The two men made their way through the early morning drizzle with the anxious Sutter deeply lost to his thoughts of how events to come would play into his plans for New Helvetia. The answers for Sutter lay in that stream.
Suddenly, the two riders came across Marshall who was lying on a pile of Manzanita brush alongside the trail. Marshall, gold fever still running through his veins, had come down the trail that morning; anxious to meet up with Sutter and take him directly to the mill. With that glazed and restless look in his eyes, Marshall raved on about gold all along the way.
In spite of Marshall's peculiar behavior, the work had gone on as usual with the widening and deepening of the race. As soon as the party arrived, Marshall had the headgate opened to let the water clear the rubble away before shutting the gate again.
Little did Sutter know that the workmen had "salted" the race with some of their collected gold with high hopes that Sutter's chance discovery would put him in a good frame of mind. In which case, he most certainly would reward his workmen with a bottle of liquor to celebrate the occasion.
Suddenly, an unsuspecting young boy of one of the workmen wandered up the race eagerly collecting most of the glittering flakes which he soon brought to his father, Sutter, and Marshall; with the poker-faced workmen and their families watching nearby.
A wave of gold fever suddenly flushed through Sutter and for the moment his earlier gloomy thoughts were gone.
"By Joe, it is rich," he was heard to say while sticking his cane firmly into the sandy soil.
Before long, the anticipated bottle of aguardiente appeared out of a saddlebag, along with a number of pocketknives that Sutter presented to the workmen as gifts.
Inspired by the discovery, and always a man of ceremony, Sutter told the workmen that he would have a finger ring made from the gold found that day as soon as he could find a goldsmith. With the engraving to read "The First Gold Discovered in January 1848." It was February 2, 1848, nine days after the fact.
The Early History of California

On that same 2nd day of February, the Mexican War that had dragged on for two long years came to an end. The United States Army, after a series of successful campaigns, had overrun much of its imperial antagonist's territory. The United States Army occupied Mexico City. Civil order waned to the point of disaster for the out-maneuvered Mexicans and they were compelled to sue for peace. The treaty was signed in Mexico City that day. With the treaty soon ratified in Washington, the victorious United States took possession of a vast territory of lands from Texas to Oregon as the spoils of war. The United States now extended from the Atlantic to the Pacific. President Polk's "Manifest Destiny" was at last completed.
The golden land of California was now forever beyond the grasp of Mexico. How ironic that the Spanish conquistadors, who had exploited the golden treasures of the Aztecs and Incas so thoroughly, had somehow missed this opportunity in California, as had the Mexicans, for the past 306 years. Had they known of such treasures, they certainly would have put up a much stiffer fight.
In 1822 California passed from Spanish to Mexican sovereignty and her ports were thrown open to legitimate trade. Cowhides were soon being traded as a commodity whenever manufactured goods were needed.
The first Yankee vessel to visit the coast was the Sachem, owned by Bryant, Sturgis & Co., out of Boston with a mixed cargo of goods to trade for hides that soon became known as "California bank-notes." Yankee captains were familiar with the northern California coast from the Northwest fur trading days that had died out by the 1820s. From then on, the Boston "hide-droghers" made their way around the Horn on voyages of two to three years duration for the purpose of filling their holds with as many as 40,000-50,000 hides, for the return voyage around the Horn to deliver their precious cargoes to the New England shoe factories. Ships from Salem as well as England were also engaged in this trade. Swift sailing brigs from Hawaii smuggled in goods as did New Bedford Whalers when they called upon the coast for fresh beef. Canton merchants sent their goods across the Pacific from China. English, French, and Italian vessels made ports of call to trade.
By the 1830s, Massachusetts Yankees were well established all along the California coast. The lure of the profitable California trade enticed many a Yankee and they "left their consciences at Cape Horn" to embrace the Catholic church in order to remain in the country, since Protestants were not allowed to live there. Yankee traders married Californian heiresses, set up shop, learned to speak a down-east dialect of Spanish and proceeded to become upstanding members of their communities.

The enterprising Yankee ships brought with them around the Horn everything that they could think of that they deemed would be useful to the Californians, who produced absolutely no manufactured goods on their own. Upon entering the harbor at Monterey, all cargoes had to be entered at the customhouse, where duties ranged from eighty percent to one hundred percent. Realizing the value of this lifeline of commerce, Mexican officials would usually charge them reasonably and were hospitable. Upon clearing customs, the ships would open up shop on board with their own makeshift variety store. Men, children, señoras, and señoritas would be rowed out in ship's boats from the wharf and soon were rummaging through "everything that can be imagined, from Chinese fireworks to English cartwheels."

"Everything under the sun," was how Richard Dana who wrote Two Years Before the Mast described the cargo during his first visit to Monterey on board the Bryant, Sturgis & Co. brig Pilgrim in 1835. "We had spirits of all kinds (sold by the cask), teas, coffees, sugars, spices, raisins, molasses, hardware, crockery-ware, tin-ware, cutlery, clothing of all kinds, boots and shoes from Lynn, calicoes and cotton from Lowell, crapes, silks; also, shawls, scarfs, necklaces, jewelry, and combs for the women. . . ."
For a week or more, the ship's crew would row the Californians to the ship and back to shore with their purchased goods.
The goods not sold were placed with an agent, usually a transplanted Yankee, who would mark up the goods and peddle them off to distant rancheros for future deliveries of cow hides along the coast. Deals were consummated by a handshake with no written contracts. Hide-brokers employed by the agents would attend the slaughters, collect and convey the hides in bullock-carts to the coastal embarcaderos and the awaiting ships.
The hides were brought down to the beach and piled above the high water mark whenever possible. At some embarcaderos, the hides were tossed over from the top of the cliffs to the waiting men below. The system of "head-work" was employed where the crew would carry the hides--folded over once with the fur inside and nearly as stiff as boards--over their heads "California fashion" one or two at a time, through the surf to the waiting boat all the while keeping them dry.
With the accumulated hides on board from a number of embarcaderos, the ship would set sail for San Diego, where the firms maintained their salt-vats. There, the hides were cured and stored until enough hides were ready to ship back around the Horn to Boston.
From San Diego to Yerba Buena, the trade in hides was a godsend for the Californios supplying the bare necessities of life, thus easing their isolation. Over the years, the numbers of foreigners increased, mostly Americans and British--sea captains, sailors, trading company representatives, and shipping agents--with skills and education that were unknown to the Californios. The new arrivals became influential in the affairs of the province and prospered. By 1840, they numbered less than 400, while the Californios numbered 6,000.
Many changes occurred over the following decade, most of them brought about by the exploits of Lieutenant John Charles Frémont and his semi-military party of topographical engineers. The ripe plum of California had passed into American hands just as gold was discovered at Sutter's Mill.
Next: Gold Fever

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