Yam-hill county is bounded on the north by Quality and Clatsop, (the line being about fifteen miles south of Oregon city,) on the east by the Willamette river, on the south by Polk county, and on the west by the Ocean.

{116} Polk county is bounded on the north by Yam-hill county, on the east by the Willamette, on the south by the California line, and on the west by the Pacific ocean.

Clackamis county is bounded on the north by the Columbia, on the east by the Rocky mountains, on the south by Shampoic county, and on the west by the Willamette, including Oregon city.

Shampoic county is bounded on the north by Clackamis county, on the east by the Rocky mountains, on the south by California, and on the west by the Willamette.

The country will, without doubt, be divided into at least three states. One state will include all the country north of the Columbia river. Nature has marked out the boundaries. Another state will include all that country south of the Columbia river to the California line, and west of the Cascade range of mountains. This country, however, is large enough to form two states. The country east of the Cascade range, extending to the Rocky mountains, and between the Columbia and California, would make another state. This would include more territory than all the remainder; but it would cover all that vast barren region of country which can never be inhabited by the white man. The western portion of this section is fertile. The line doubtless would be established between, leaving the eastern portion as Oregon territory, for future generations to dispose of.

The country now contains over six thousand white inhabitants; and the emigration this year, over land, will be about seventeen hundred souls, and that by water will probably equal it, which will increase the number to near ten thousand. It may be a safe calculation to set down the number for the first of January, 1847, at twelve thousand souls.

The settlers are labouring under great disadvantages on account of not being able to obtain a sufficient amount of farming implements. The early settlers were supplied at the Hudson Bay Company's store, and at prices much less than those now charged for the same articles. At that time the supply was equal to the demand; but since the tide of emigration has turned so strongly to this region, the demand is much greater than the supply. This may be said of almost every kind of goods or merchandise. The supply of goods in the hands of the American merchants has been very limited, being the remnant of cargoes shipped round upon the coast, more for the {117} purpose of treating with the Indians, than with the cultivators of the soil.

Great complaints have been made by the merchants trading in that quarter, that they were not able to compete with the Hudson Bay Company; and this is the cry even at home; but the fact is, the prices were much lower before these American merchants went into the country than they now are. Their mode of dealing is to ask whatever their avarice demands, and the necessities of the purchaser will bear. And not being satisfied with an open field, they have petitioned the Hudson Bay Company to put a higher price upon their goods, as they were selling lower than the American merchants wished to sell. In accordance with this request, the H. B. Company raised the price of goods when sold to an American, but sold them at the old prices to British subjects. This arrangement was continued for two years; but an American can now purchase at the fort as cheap as any one. These facts I obtained from various sources, and when apprised of the prices of goods in that country, they are not so hard to be believed.

I paid for a pair of stoga shoes, made in one of the eastern states, and a very common article, four dollars and fifty cents; for a common coarse cotton flag handkerchief, which can be had in Cincinnati for five or ten cents, fifty cents. The price of calico ranges from thirty-one to eighty-seven and a half cents a yard; common red flannel one dollar and fifty cents per yard; a box of two hundred and fifty percussion caps, two dollars and fifty cents; coarse boots, eastern made, six to eight dollars; calfskin from ten to twelve dollars; coarse half hose, one dollar; dry goods generally ranging with the above prices. Iron was selling at twelve and a half cents per pound. Tools of all kinds are very high; so that whatever may be said against the company, for putting down the prices to destroy competition by breaking up other merchants, cannot be "sustained by the facts of the case." That they prevent them from raising the prices there is no doubt, and if the American merchants had the field, clear of competition, the prices would be double what they now are. They have not capital to enable them to keep up a supply, nor to purchase the surplus of the country. The Hudson Bay Company are the only purchasers to any extent, for there are no others who have the necessary machinery to manufacture wheat, which is the staple of the country at present. The American merchants buy a few fish, {118} hides, and lumber; but in such limited quantities as to be of very little advantage to the country.