When news of the gold discovery on the American River reached Sutter’s Fort, John Sutter did his best to keep it quiet. He knew if word got out his sawmill would never be finished and his crops would never be harvested. He sent John Bidwell to San Francisco to have the sample assayed, but he asked him to keep the news to himself.
Undoubtedly John Bidwell did his best.
But the news leaked out. On March 15, 1848 the Californian newspaper published the news, although many were skeptical that there was anything much in the report. It would be another two months before the rush to the hills began.
Meanwhile, Sam Brannan was buying up all the picks, shovels, crowbars and pans he could find. Flour, salt, knives, gunpowder, blankets, and foodstuffs of all kinds — anything that a man heading to the mines might want, Brannan stocked at his store at Sutter’s Fort.
Then he went to San Francisco and famously rode around Portsmouth Square with a flask of gold in his hand, shouting, “Gold, gold from the American River!” The rush was on, and Sam Brannan was ready for it.
So when John Bidwell and George McKinstry wanted to buy goods to sell at their own trading post on the Feather River, they first went to Brannan’s store at Sutter’s Fort. A receipt records that on June 23rd and July 6th, 1848, goods such as 200 pounds of flour, 6 pounds of lead, bags of salt, a bottle of pepper, knives, forks, buckets and fish line were “Bot of S. Brannan & Co.” by George McKinstry. John Bidwell was up on the Feather River, looking for gold.
(Brannan’s name is on the third line. Kemble and Rolfe were his agents. The word “bought” was typically abbreviated as “Bot.”)
Powder (gunpowder) sold for $3.00 a pound at Brannan’s store in the summer of 1848. In 1849 Bidwell sold it for $12.00 a pound at his store on the Feather River. The Emigrant’s Guide to California (1849) lists the price of gunpowder in the States at $.22 a pound ($5.50 for 25 pounds — the recommended amount.).
Flour, which sold for $.02 a pound in the States, cost $.14 a pound at Brannan’s store in Sacramento, and $.50 a pound at Bidwell’s Bar.
The list goes on and on, and we will see more examples of inflation as we continue. It’s no wonder that immigrants to California marveled at the prices and wondered how they could possibly get by.