The town of San José is situated in a fertile valley, near the most southern extremity of the Bay of San Francisco. On the south of the town runs a small stream, and the place is surrounded by plains, affording fine pasturage. Being situated on the direct route from the southern ports to the gold mines, San José received a considerable stimulus from their discovery. A profitable trade was soon established, and the town improved very rapidly. It is now a town of about four thousand inhabitants, and the increase still continues rapid. In a greater degree than any of the older towns of California, it has all the evidence of a thriving and progressive place. The greater part of the buildings are constructed in a style which shows the inroads of the taste of the people from the Atlantic States. A number of Mormons settled here at an early period, and built a great many neat wooden houses and cottages, which contrast favorably with the heavy old adobés residences of the native inhabitants. Flour and saw-mills have been erected, but the scarcity of water is severely felt by their proprietors.

San José in respect to climate and general abundance of the necessaries and luxuries of life, is one of the most desirable places of residence in California. Though situated a short distance inland, and thus deprived of the facilities which contributed to the rapid growth of San Francisco, the fertile plain surrounding it, and the increase of the inland trade and travel will draw to the town and its neighborhood a thriving, business population. The old mission of San José is situated about ten miles from the town. The establishment and the grounds belonging to it are in a state of decay. The population there is about three hundred in number, most of whom are Indians, and all of them in a degraded condition.

The emigration to the gold region caused many towns to spring up, as if by magic, in its neighborhood, and on the route to it from San Francisco. These were principally the stopping places of the gold-seekers, or the seat of a trade in provisions and articles manufactured in the States and transported thither. Some of these towns have become of a size sufficient to warrant the assertion that they will soon rival the cities of the Atlantic coast of the United States. The progress of these places is aided by the enormous price of real estate in San Francisco.

One of the most promising of the new towns is called Benicia. It is situated on the Strait of Carquinez, thirty-five miles north of San Francisco. The strait forms the entrance of Suisan into Pablo Bay. The site of Benicia is a gentle slope, which, descending to the water, becomes almost a plain. Vessels of the first class can lie at anchor at its bank, and discharge their cargoes, and the harbor is safe from violent winds. The town has been made the head-quarters of the Pacific division of the United States army, and a site for a navy-yard has been selected by Commodore Jones. The marks of governmental favor show in what estimation the position of Benicia is held. The town was laid out in 1848, by Robert Semple and Thomas O. Larkin. Early in 1850, lots were selling at very high rates, and the population numbered more than a thousand persons.

Between Benicia and Sacramento city, several towns have been laid out, all in very favorable positions. The principal are—Martinez, on the southern shore of the strait of Carquinez, nearly opposite Benicia; New York of the Pacific, at the junction of the River San Joaquin with the Bay of Suisan; Suisan, on the west bank of the Sacramento, at a distance of eighty miles from San Francisco.

Next to San Francisco, Sacramento is the largest city in California. It is situated on the eastern bank of the Sacramento River, one hundred miles from San Francisco, and sixty-five from Suisan Bay. It is located on a beautiful plain, which is not elevated more than ten or twelve feet above the river at low water. This being insufficient to protect it from the rise of the waters of the river, several disastrous floods have occurred during the existence of the city. Up to this point, the river is navigable for large class steamers. Ships drawing not more than twelve feet of water may go up that far at all seasons; and, besides these commercial advantages, Sacramento is the natural trading depot for the richest portion of the mining regions.

Where the city of Sacramento now stands, at the time of the gold discovery, there stood, "solitary and alone," a small fort. This formed the nucleus, about which, at the commencement of the rush of emigration, the town soon sprang into existence. Its increase has been almost as rapid as that of San Francisco. During the rainy season of the early part of 1850, the population numbered somewhere between twenty and thirty thousand. But at that period, a considerable portion of the gold-diggers made Sacramento and the other towns in the neighborhood of the mines, their resort, to escape the severity of spending the season at the open and exposed valleys of the gold region. The city is regularly laid out, but its appearance evidences the rapidity of its erection. The greater number of the houses and stores in the neighborhood of the river are constructed of wood, while the outskirts, particularly upon the south, are occupied by the tents of the constantly-arriving overland emigrants. Before the commencement of the last rainy season, the number of these emigrants reached two or three thousand. They squatted upon the vacant lots which had been surveyed and sold to other persons. This caused a considerable agitation in the town, which continued till the disastrous flood swept both the parties off the ground, and thus left the field clear for another commencement. Sacramento is the grand receptacle of the overland emigration, and this, combined with its commercial facilities, will continue to give the city a superiority over the majority of the other places in California.

Adjoining Sacramento city, is the town of Sutter. It is situated on the highest and healthiest ground on the river. It is not, like Sacramento, subject to an annual overflow. The town was originally laid out by Captain Sutter and others; and is owned by Hon. John McDougall, Lieutenant-Governor of California, and Captain Sutter. It has a thriving business population, and its position, and the fertility of the neighboring country will soon make it a place of importance.

Stockton is to the southern portion of the gold region what Sacramento is to the northern. It is situated upon a slough, or a succession of sloughs, containing the back waters formed by the junction of the San Joaquin and Sacramento Rivers. It is about fifty miles from the mouth of the San Joaquin, and one hundred from San Francisco. The ground upon which it is situated is high and is not subject to overflow. Vessels drawing nine feet water can ascend the San Joaquin as far as Stockton, and discharge their cargoes on the bank. In the latter part of 1848, the town was laid out and a frame building erected by Charles M. Weber. In eight months from that time, it contained a population of about two thousand permanent residents, and a large number of temporary residents, on their road to the mines. Communication is with San Francisco by means of steamboats and launches, and the commerce of the town is constantly increasing.

Other towns exist—on paper—in the neighborhood of San Francisco and the gold region, and, doubtless, they will, in the course of time, become settled by a thriving, go-ahead population from the Atlantic States. Land speculation in California is as profitable a business as gold-digging—and less toilsome. Many of the shrewd ones, who early took advantage of this "tide in the affairs of men," have already reached the goal of their hopes, an independent fortune. Those who saw how things would turn out, and purchased land in the neighborhood of the region which promised to receive the principal current of the emigration to California, found themselves wealthy in the short space of a few months.