The Best Way to Get Rich During the California Gold Rush Was by Selling Mining Pans And Eggs
James Wilson Marshall was the one who discovered gold flakes in the American River in the Sacramento, California, Valley in 1848. His discovery set off more than Gold Rush Fever. A total of $2 billion’s worth of gold was extracted in the area, though wealth was concentrated among the few.
Like any dream of hitting the lottery, gold-mining required timing, luck, and hard work. Those who arrived early in 1848 and 1849 fared well enough. Men, and a few women, poured into the region. They arrived with little more than they could carry. They needed food and tools.
Since California was located in a remote location, most supplies were imported from vast distances. In just a few months, prices for food, dry goods, and supplies tripled.
Edward Gould Buffum, the first journalist to write a book about the Gold Rush, Six Months in the Gold Mines, published in 1850, described how breakfast of bread, cheese, butter, sardines and two bottles of beer with a friend cost him a staggering $43, the equivalent today of $1,326.70.
Pans the miners used cost 20 cents before 1849, but soon rose to $8, or $246 in today's dollars. Boots cost $6, or $185. A shovel went for $36, or more than $1,000. The price of eggs rose from $1 per egg to $3, or $92.56. Rice was $8 per pound, or $246.83. Beer cost $10 per pound, or $308.54.
Those starved for information paid a hefty price: Old newspapers sold for $1 each, or around $30 today. The merchant Sam Brannan built a store next-door to Sutter’s Fort, where Marshall first discovered gold. During the height of the rush, Brannan made $2,000 a day from miners.
The region’s population continued to swell during the early 1850s even as the opportunity to strike it rich dried up. New manufacturing methods required capital and centralized control of deep-lode mining in the hands of a wealthy few.
Some of the most iconic American entrepreneurs launched their careers and empires during the Gold Rush. The early seeds of Philip Danforth Armour’s meatpacking empire were planted when he went to California and sold food to miners. Levi Strauss peddled dry goods, including his sturdy denim cloth (though the iconic blue jeans weren’t manufactured until 1873). Henry Wells and William Fargo established a banking business. John Studebaker made wheelbarrows for miners. California had established itself as a major player in the U.S. economy.