Coin Shortage in the Early Days of California

[WoodenJefferson]

Once a 49er made it to San Francisco or the Sierras, the necessary supplies and food were very expensive. Laboring in the gold fields could earn a man $10 per day, compared to the $1 per day a similarly skilled worker would earn back home in the East. Gold miners were frequently paid in gold dust and nuggets. Federal coinage to pay for labor and supplies was not available in sufficient quantity to support this new boom economy. While there were not enough coins, there was plenty of gold! The problem is that not all gold is of the same fineness, and unscrupulous individuals would try and cheat others by mixing in brass shavings with gold dust, or gold plating pieces of lead.

 

In 1854 the United States government established the San Francisco branch mint to produce legal tender coins. Many people brought in their privately minted gold coins so that they could be assayed and recoined into federal coinage. This massive melting of the earlier gold rush coins is a large part of why these privately minted gold pieces are so rare today.

 

Due to extreme shortage of coins in California in 1851, gold dust was the standard of commerce. One pinch of gold dust (roughly 1.67 grams) was equivalent to $1.

 

 

Troy weight is the standard measurement for gold. These are the equivalents:

1 pound equals 12 ounces

1 pound equals to .3732 kilograms

1 ounce equals to 20 pennyweight

1 pennyweight equals 24 grains

 

Old gold fields of California.

 

http://www.consrv.ca.gov/cgs/minerals/images/Big_AUMap.pdf

 

(grab +magnifying glass in tool bar to zoom in/out)

[DC Dawg]

I read about this... and also how a lot of private mints took up a lot of the slack by assaying and coining gold to be used in commerce. The article I read also talked about how some assayers would cheat the customer by shaving a gram-or-so off of the coins they made.

 

The story as to how the west adapted to the finding of metals (gold in California, silver in Colorado) and not having a "trusted" third party to mediate until the government got its act together is just fascinating. It shows that people can adapt to any situation and get by... (rant about getting rid of the $1 bill deleted ).

 

Scott