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The boom and bust of San Francisco business

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From the very beginning of the gold rush goods of all kinds flowed into the harbor of San Francisco from all over the world. The trade in these goods was huge and extraordinarily brisk, but the market was subject to wild fluctuations. There was a huge risk and expense to keep these goods on hand and thus they needed to be sold as soon as possible. When a ship arrived its cargo was almost always disposed of immediately at auction. If the imported articles happened to be in great demand, as often happened, then they would command a high price and large profits could be made almost at once, but if several ships carrying similar merchandise were to arrive at the same time, or if the goods a ship brought did not happen to be needed at the time, then great losses could be incurred just as rapidly as could be the gains.

Business in early San Francisco was always in a rush. Everything had to be dealt with quickly. There was no time to wait. Men had to be wide-awake and always on hand, even a small delay could be costly. Acting quickly was better than not acting at all. The thought and the act had to be done together. As time passed, and credit, capital and storage space increased, business became more methodical and the frantic pace slowed, but much of the push and speed of the auction system remained a part of San Francisco for many years and almost every type of business was marked by these characteristics.

John Putnam is the author of Hangtown Creek, a thrilling saga of the early California gold rush.

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