A run on gold rush banks

Early in the year of 1855 the St. Louis office of Page, Bacon & Co. found itself in financial difficulty because of its involvement in the Ohio and Mississippi Railroad and sent a partner to San Francisco so that he could ship back all the money possible from the bank there to help with the crisis. Unfortunately the St. Louis branch failed after the partner left and due to an accident the steamer that would have brought the news of that failure to the west coast was detained. Two steamships left San Francisco carrying nearly a million dollars in gold destined for the bank in St. Louis before, on February 17, 1855, the news arrived that the main office of Page, Bacon & Co. had failed. Immediately a violent run on their bank at Montgomery and California Streets began. The bank owed about two million dollars. After some six hundred thousand had been withdrawn it was said that Henry Haight, the manager, became demoralized and this caused others in San Francisco to refuse to aid the bank. Whatever the truth, the bank stayed open and the run continued.

Montgomery Street, San Francisco 1852

On February 23, 1855, Page, Bacon sent out a short printed noticed that said that because of a lack of money they found it necessary to close for a short time. The other San Francisco banks knew then that the bank run would turn to them, but they stayed open nonetheless. For the bank managers the night before was filled with anxiety and, shortly before daylight, William T. Sherman, manager of Lucas, Turner & Co. was informed that Adams & Co., because of the poor condition they found themselves in, would not open the next morning. In fact, Adams & Co. did not open that morning and there was a general run on all San Francisco banks. Nearly everyone in town, who had money in any of the banks, rushed to withdraw it. Rumors flew through the streets. Men were wild with fear and uncertainty. The level of excitement rose to a fever pitch. For years afterwards Friday February 23, 1855 would be remembered as the day of the great crash, the Black Friday of San Francisco.

Page, Bacon & Co. Check

 

 

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