Editing California gold rush (section)

==Profits==
Recent scholarship confirms that merchants made far more money than miners during the gold rush.<ref name="Migrating to Riches?">{{cite journal |first1=Karen |last1=Clay |first2=Randall |last2=Jones |title=Migrating to Riches? Evidence from the California Gold Rush |journal=Journal of Economic History |year=2008 |volume=68 |issue=4 |pages=997–1027 |doi=10.1017/S002205070800079X |citeseerx=10.1.1.163.572 }}</ref>{{sfnb|Rohrbough|1998}} The wealthiest man in California during the early years of the rush was [[Samuel Brannan]], a tireless self-promoter, shopkeeper and newspaper publisher.<ref name=HollProf>{{harvb|Holliday|1999|pp=[https://archive.org/details/rushforrichesgol00holl/page/69 69–70]}}</ref> Brannan opened the first supply stores in Sacramento, Coloma, and other spots in the goldfields. Just as the rush began, he purchased all the prospecting supplies available in San Francisco and resold them at a substantial profit.<ref name=HollProf/>

Some gold-seekers made a significant amount of money.<ref name=HollFeather>{{harvb|Holliday|1999|p=[https://archive.org/details/rushforrichesgol00holl/page/63 63]}}</ref> On average, half the gold-seekers made a modest profit, after taking all expenses into account; economic historians have suggested that white miners were more successful than black, Indian, or Chinese miners.<ref>{{cite journal |last1=Zerbe |first1=R. O. |last2=Anderson |first2=C. L. |year=2001 |title=Culture and fairness in the development of institutions in the California gold fields |journal=Journal of Economic History |volume=61 |issue=1 |pages=114–143 |jstor=2697857 |doi=10.1017/S0022050701025062 |doi-broken-date=November 1, 2024 |s2cid=14379888 }}</ref> However, taxes such as the California foreign miners tax passed in 1851, targeted mainly Latino miners<ref>{{harvb|Sears|2014|p=68}} "In 1852 the California state legislature targeted Chinese residents for a 'foreign miners' tax [...]"</ref> and kept them from making as much money as whites, who did not have any taxes imposed on them. In California most late arrivals made little or wound up losing money.<ref name="Migrating to Riches?" /> Similarly, many unlucky merchants set up in settlements that disappeared, or which succumbed to one of the calamitous fires that swept the towns that sprang up. By contrast, a businessman who went on to great success was [[Levi Strauss]], who first began selling denim overalls in San Francisco in 1853.<ref>[[Levi's]] jeans were not invented until the 1870s. Lynn Downey, ''Levi Strauss & Co.'' (2007)</ref>

Other businessmen reaped great rewards in retail, shipping, entertainment, lodging,<ref name=JamesLick>[[James Lick]] made a fortune running a hotel and engaging in land speculation in San Francisco. Lick's fortune was used to build [[Lick Observatory]].</ref> or transportation.<ref name=BigFour>Four particularly successful Gold Rush era merchants were [[Leland Stanford]], [[Collis P. Huntington]], [[Mark Hopkins, Jr.|Mark Hopkins]] and [[Charles Crocker]], Sacramento area businessmen (later known as the [[The Big Four (Central Pacific Railroad)|Big Four]]) who financed the western leg of the [[First transcontinental railroad]], and became very wealthy as a result.</ref> Boardinghouses, food preparation, sewing, and laundry were highly profitable businesses often run by women (married, single, or widowed) who realized men would pay well for a service done by a woman. Brothels also brought in large profits, especially when combined with saloons and gaming houses.<ref name = Johnson>{{harvb|Johnson|2001|pp=[https://archive.org/details/roaringcamp00susa/page/164 164–168]}}</ref>

By 1855, the economic climate had changed dramatically. Gold could be retrieved profitably from the goldfields only by medium to large groups of workers, either in partnerships or as employees. By the mid-1850s, it was the owners of these gold-mining companies who made the money. Also, the population and economy of California had become large and diverse enough that money could be made in a wide variety of conventional businesses.<ref name=RawlsBusiness>{{harvb|Rawls|Orsi|1999|pp=[https://archive.org/details/goldenstateminin0000unse/page/52 52–68], [https://archive.org/details/goldenstateminin0000unse/page/193 193–197]}}</ref>

===Path of the gold===
[[File:SanFrancisco1851a.jpg|thumb|upright=1.25|Portsmouth Square, San Francisco, during the gold rush, 1851]]

Once extracted, the gold itself took many paths. First, much of the gold was used locally to purchase food, supplies and lodging for the [[miner]]s. It also went towards entertainment, which consisted of anything from a traveling theater to alcohol, gambling, and prostitutes. These transactions often took place using the recently recovered gold, carefully weighed out.<ref name=RawlsScales>{{harvb|Rawls|Orsi|1999|pp=[https://archive.org/details/goldenstateminin0000unse/page/212 212–214]}}</ref>{{sfnb|Young|1970|pp=[https://archive.org/details/westernmininginf0000youn/page/109 109]}} These merchants and vendors, in turn, used the gold to purchase supplies from ship captains or packers bringing goods to California.<ref name=RawlsPack>{{harvb|Rawls|Orsi|1999|pp= [https://archive.org/details/goldenstateminin0000unse/page/256 256–259]}}</ref>

The gold then left California aboard ships or mules to go to the makers of the goods from around the world. A second path was the Argonauts themselves who, having personally acquired a sufficient amount, sent the gold home, or returned home taking with them their hard-earned "diggings". For example, one estimate is that some US$80 million worth of California gold (equivalent to US${{inflation|US|.08|1855|r=1|fmt=c}} billion today) was sent to France by French prospectors and merchants.<ref name=HollFren>{{harvb|Holliday|1999|p=[https://archive.org/details/rushforrichesgol00holl/page/90 90]}}</ref>

A majority of the gold went back to New York City brokerage houses.<ref name="Stiles 2009"/>

As the gold rush progressed, local banks and gold dealers issued "banknotes" or "drafts"—locally accepted paper currency—in exchange for gold,<ref name=RawlsCurr>{{harvb|Rawls|Orsi|1999|pp=[https://archive.org/details/goldenstateminin0000unse/page/193 193–97], [https://archive.org/details/goldenstateminin0000unse/page/214 214–215]}}</ref> and private mints created private gold [[coin]]s.<ref name=RawlsCoins>{{harvb|Rawls|Orsi|1999|p=[https://archive.org/details/goldenstateminin0000unse/page/214 214]}}</ref> With the building of the [[San Francisco Mint]] in 1854, [[Gold as an investment|gold bullion]] was turned into official United States [[California gold coinage|gold coins]] for circulation.<ref name=RawlsMint>{{harvb|Rawls|Orsi|1999|p=[https://archive.org/details/goldenstateminin0000unse/page/212 212]}}</ref> The gold was also later sent by California banks to U.S. national banks in exchange for national paper currency to be used in the [[economic boom|booming]] [[economy of California|California economy]].<ref name=RawlsNatBank>{{harvb|Rawls|Orsi|1999|pp=[https://archive.org/details/goldenstateminin0000unse/page/226 226–227]}}</ref>