History of the California Gold Rush Creating Wealth
The California Gold Rush Created Wealth out WestAlthough popularly known as the 49ers, the California Gold Rush actually began a year earlier in 1848. This was a less than a decade period where people moved to California in hopes of capitalizing on the discovery of gold in the American territory. In all about 300,000 people moved to California from 1848 through 1855, half of which walked 1,500 miles from the East Coast.
James W. Marshall Discovers GoldOn January 24, 1848 James W. Marshall brought a shiny piece of metal to the attention of his boss John Sutter. After testing it together, they concluded it was indeed gold. Surprisingly enough, Sutter was disappointed at this finding! He had hoped to turn California into an agriculture center and thought that the attention from the gold would lead to a massive land rush into the area. He was certainly right. The current area of California was actually Mexican territory when Marshall found the first bit of gold. Just nine days later the land was ceded to the U.S. with the signing of the Treaty of Guadalupe Hidalgo, ending the Mexican-American War. Led by newspaper publisher Samuel Brennan, the news of gold spread quickly and, in fact, Brennan capitalized on the gold rush by setting up a store that sold gold prospecting supplies.
News of Gold Spreads EastIt wasn’t until August that the news was first reported on the East Coast. President James Polk confirmed the finding during an address to Congress In December of that year and the rush to move to California was on. San Francisco went from a small settlement to a ghost town when its citizens went to find gold and then exploded and grew 25 times in just two years. California quickly became a place with a lot of people but not a lot of law. California wasn’t even technically a territory of the United States until the fall of 1850—more than two years after the discovery of gold. Adding to the confusion is that most of the gold that was formally public land.
The Gold Rush Comes to an EndAt the end of the gold rush, merchants around the area made off with more money than the miners. The man who came off perhaps the best was Samuel Brennan, who had first spread the word of gold and had opened a shop selling prospecting equipment. He had purchased all of the supplies in San Francisco at the time and re-sold them at a significant markup. However, half the miners made a small profit but the ones who arrived later often lost money. As a result, the number of miners entering California quickly slowed to a trickle and the California Gold Rush came to an end.
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