The mines continued to yield about fifty millions of gold a year; but little attention was paid to agriculture or to any business other than that of "mining," and, as the placer-gold was becoming worked out, the miners were restless and uneasy, and were shifting about from place to place, impelled by rumors put afloat for speculative purposes.

A great many extensive enterprises by joint-stock companies had been begun, in the way of water-ditches, to bring water from the head of the mountain-streams down to the richer alluvial deposits, and nearly all of these companies became embarrassed or bankrupt.

Foreign capital, also, which had been attracted to California by reason of the high rates of interest, was being withdrawn, or was tied up in property which could not be sold; and, although our bank's having withstood the panic gave us great credit, still the community itself was shaken, and loans of money were risky in the extreme.

A great many merchants, of the highest name, availed themselves of the extremely liberal bankrupt law to get discharged of their old debts, without sacrificing much, if any, of their stocks of goods on hand, except a lawyer's fee; thus realizing Martin Burke's saying that "many a clever fellow had been ruined by paying his debts." The merchants and business-men of San Francisco did not intend to be ruined by such a course.

I raised the rate of exchange from three to three and a half, while others kept on at the old rate; and I labored hard to collect old debts, and strove, in making new loans, to be on the safe side.
The State and city both denied much of their public debt; in fact, repudiated it; and real estate, which the year before had been first-class security, became utterly unsalable.
The office labor and confinement, and the anxiety attending the business, aggravated my asthma to such an extent that at times it deprived me of sleep, and threatened to become chronic and serious; and I was also conscious that the first and original cause which had induced Mr.Lucas to establish the bank in California had ceased.