Miners were getting high wages and spending their money lavishly, owners of buildings in Virginia City receiving from four to eight per cent. a month on their investments. W. C. Ralston, President of the Bank of California at San Francisco, was largely responsible for this remarkable excitement, for he not only lent money freely but he lent it regardless of conservative banking principles. He engaged in indiscriminate speculation, for a time legitimatizing illegitimacy, and people were so incited by his example that they plunged without heed. All of Nevada's treasure was shipped to San Francisco, whose prosperity was phenomenal. From San Francisco the excitement spread throughout the State; but these conditions, from the nature of things, could not endure. From Bull to Bear is but a short step when the public is concerned, and it happened accordingly, as it so frequently does, that the cry of "Save yourself, if you can!" involved California in a general demoralization. One day in October, 1875, when Ralston's speculation had indeed proven disastrous, the Bank of California closed its doors; and a few days after this, Ralston, going a-swimming in the neighborhood of the North Beach at San Francisco, was drowned—whether a suicide or not, no one knows. In the meantime, the recessional frenzy extended all over the State, and every bank was obliged to close its doors. Those of Los Angeles were no exception to the rule; and it was then that Temple & Workman suspended. I. W. Hellman, who was on a European trip at the time, forthwith returned to Los Angeles, re-opened the doors of the Farmers & Merchants Bank and resumed business just as if nothing had happened. Following this panic, times became dreadfully bad; from greatest prosperity, we dropped to the depths of despair. Specie disappeared from circulation; values suffered, and this was especially true of real estate in California.
Temple & Workman's Bank, for reasons I have already specified, could not recover. Personally, these gentlemen stood well and had ample resources; but to realize on these was impossible under conditions then existing. They applied to E. J. Baldwin, a Monte Cristo of that period, for a loan. He was willing to advance them two hundred and ten thousand dollars, but upon two conditions: first, that they would give him a blanket-mortgage on their combined real estate; secondly, that their intimate friend, Juan Matías Sanchez, would include in the mortgage his splendid tract consisting of twenty-two hundred acres of the finest land around the Old Mission. Sanchez, who transacted a good deal of business with H. Newmark & Company, came to me for advice. I felt convinced that Temple & Workman's relief could be at best but temporary, although I am sure that they themselves believed it would be permanent, and so I strenuously urged Sanchez to refuse; which he finally promised me to do. So impressive was our interview that I still vividly recall the scene when he dramatically said: "¡No quiero morir de hambre!"—"I do not wish to die of hunger!" A few days later I learned, to my deep disappointment, that Sanchez had agreed, after all, to include his lands. In the course of time, Baldwin foreclosed and Sanchez died very poor. Temple also, his pride shattered—notwithstanding his election in 1875 to the County Treasurership—died a ruined man; and Workman soon committed suicide. Thus ended in sorrow and despair the lives of three men who, in their day, had prospered to a degree not given to every man, and who had also been more or less distinguished. Baldwin bought in most of the land at Sheriff's sale; and when he died, in 1909, after an adventurous career in which he consummated many transactions, he left an estate of about twenty millions. A pathetic reminder of Sanchez and his one-time prosperity is an asador or meat toaster, from the old Sanchez homestead, now exhibited at the County Museum.
In 1874, Senator John P. Jones came south and engaged with William M. Stewart, his senatorial colleague (once an obscure lawyer in Downieville, and later a Nevada Croesus), in mining at Panamint, purchasing all their supplies in Los Angeles. About the same time, Colonel R. S. Baker, who had shortly before bought the San Vicente rancho, sold a two-thirds interest in the property to Jones; and one of their first operations was the laying out of the town of Santa Monica. After the hotel and bath-houses had been built, an auction sale of lots took place on July 16th, 1875, and was attended by a large number of people, including myself; prospective buyers coming from as far as San Francisco to compete with bidders from the Southland. Tom Fitch, already known as the "Silver-tongued Orator," was the auctioneer and started the ball rolling with one of his most pyrotechnical efforts. He described the place about to be founded as "The Zenith City by the Sunset Sea," and painted a gorgeous vista of the day when the white sails of commerce would dot the placid waters of the harbor, and the products of the Orient would crowd those of the Occident at the great wharves that were to stretch far out into the Pacific!
Then Tom turned his attention and eloquence to the sale of the lots, which lay along Ocean Avenue, each sixty by one hundred and fifty feet in size. Calling for a bid, he announced the minimum price of three hundred dollars for sites along the ocean front. Several friends—I. M. Hellman, I. W. Hellman, Kaspare Cohn, Eugene Meyer and M. J. Newmark—had authorized me to act for them; and I put in the first bid of three hundred dollars. Fitch accepted, and stated that as many more of these lots as I wanted could be had at the same price; whereupon I took five, located between Utah and Oregon avenues. These we divided among us, each taking fifty feet front, with the expectation of building summer homes; but strange to say, none of us did so, and in the end we sold our unimproved ground. Some years later, I bought a site in the next block and built a house which I still occupy each year in the summer season.
Three early characters of Santa Monica had much to do with the actual starting of the place. The one, L. G. Giroux, a Canadian, walked out to Santa Monica one day in 1875, to get a glimpse of the surf, and came back to town the owner of a lot on which he soon built the second permanent house there—a small grocery and liquor shop. In the eighties, Giroux did good public service as a Supervisor. The second, Billy Rapp, also came in 1875 and built a small brick house on the west side of Second Street somewhere between Utah and Arizona avenues. There, after marrying a German Frau, he opened a saloon; and pleasure-seekers visiting Santa Monica on Sundays long remembered Billy's welcome and how, on the arrival of the morning train from Los Angeles, he always tapped a fresh keg of lager. After a while, he closed his saloon and sold the little building for a town hall. Hard times in later years rapped at Billy's door, forcing him to work on the public streets until 1899, when he died. The third settler was George Boehme, who landed with the first steamer and, within an hour or two, invested in lots. His family is there to-day.
Another pioneer Santa Monica family was that of William D. Vawter who, with his sons, W. S. and E. J., originally members of the Indiana Colony at Pasadena, removed to the beach in 1875. My relations with these gentlemen were quite intimate when they conducted a general merchandise business, that being but one of their numerous enterprises. Of late years, W. S. Vawter has twice been Postmaster at Santa Monica.
In 1875, Paul Kern, who had come to Los Angeles in 1854 and was for years a baker, set to work to improve a piece of property he owned at the junction of South Main and Spring streets, between Eighth and Ninth. At the end of this property he erected a two-story brick building—still to be seen—in the lower part of which he had a grocery and a saloon, and in the upper part of which he lived.
Toward the middle of the seventies, A. Ulyard, the baker, embarked in the carrying of passengers and freight between Los Angeles and Santa Monica, sending a four-horse stage from here at half-past seven every morning, and from Santa Monica at half-past three in the afternoon, and calling at all four Los Angeles hotels as well as at the private residences of prospective patrons. One dollar was the fare charged.
Ralph Leon had the only regular cigar store here in the late sixties, occupying a part of the United States Hotel; and he was very prosperous until, unable to tolerate a nearby competitor—George, a brother of William Pridham—he took up a new stand and lost much of his patronage. Pridham opened the second cigar store, about 1872 or 1873, next to the hotel; and Leon moved to a shop near the Farmers & Merchants Bank.
The names of these early dealers remind me of an interesting custom especially popular with Captain Thom, Billy Workman and other lovers of the aromatic weed. Instead of buying cigars by the piece, each of these inveterate smokers purchased a box at a time, wrote his name on the lid and left it on a shelf of the dealer; and from time to time they would slip in by a rear door and help themselves—generally from their own or, occasionally, from their neighbor's supply. When Leon discovered that the patron's box was empty, he would have it refilled.