1837 until 1863 was a period of many developments in our young nation. In 1837 Samuel Morses’ invention of the telegraph enabled instant communication through the United States, at least to the Mississippi River. In the west, a trade outpost known as Yerba Buena was populated with about 500 pioneers. About 1847, Yerba Buena became San Fransisco, and the federal government brought California under U.S. military control.
Everything changed abruptly in January the following year with the first gold discovery at a sawmill on the American River. News of the development made its way into small newspapers such as the California Star. By mid-June, settlers were leaving outpost like San Francisco nearly deserted and setting up campsites along the rivers near what is now Sacramento.
By the end of 1848, the gold rush was on, with thousands of people from all over the U.S. fleeing to get in on the newly discovered riches. At this time the only travel from east to west was by way of covered wagons across treacherous mountains, native Indians, wild animals and disease of all kinds. One could travel from New York City and travel utilizing the steamship to Aspinwall, Panama. Move overland to Panama City and board another steamship to San Francisco. Moving people and products across our nation were dangerous and time-consuming.
South American Route – Panama Route
Travel across our nation in the early 1800s was very challenging. If one set out at the Missouri River to travel to Sacramento, CA, it usually took four to six months, by way of the covered wagon pulled by oxen. Illness more than violence overtook most of those that started out on the journey. Wagon accidents, drownings, and gunshots were the cause of several deaths. Many faced the unfortunate prospect of cholera, food poisoning or typhoid. These are just some of the challenges for people finding a way to cross our nation, much less finding a way to transport supplies or freight.
Traveling overland was by far the cheapest, but accidents and illness took their toll on the people. As a result, most people moved from coast-to-coast by way of the sailing ship utilizing the Cape Horn route around the tip of South America – about 13,000 miles from New York to San Francisco. The fastest trip recorded was about 88 days. However, most trips took four to six months as all this was dependent on the wind.
The Panama route was by far the quickest but more expensive. A steamship could go from San Francisco, travel south 3,000 miles to Panama City and the people crossed the isthmus overland to Aspinwall (now Colon). In Aspinwall, they boarded another steamship for the 2,000-mile journey to New York City. The entire trip took 20 to 24 days.
Before 1855 the Isthmian crossing was the most dangerous. Travelers had to make their way by dugout canoe and on mule-back through the steamy, fever-ridden jungle, a trip that generally took five days or more. The Panama railroad was completed in 1855, and the trip was diminished to an innocuous four-hour jaunt.
The sidewheel steamships were reasonably comfortable, but three weeks at sea was enough time to make the trip monotonous. People faced exposure to tropical diseases such as dysentery, yellow fever, and cholera. Nevertheless, the Panama route was the safest and more suitable. It was also the quickest way to get supplies and cargo from coast-to-coast at that time.
Altogether between 1848 and 1869, 640,000 passengers traveled this route, and this was the primary route for the U.S. Mail. There was also the precious cargo of all the gold that was mined in California. The SS Central America made 43 round trips from New York to Panama, carrying a third of the gold transported from California to New York. It would not conclude its 44th trip.
Central America Shipwreck
On the morning of August 20, 1857, more than 450 eastbound travelers boarded the steamship Sonora for the trip to New York. The SS Sonora was the leading ship on the journey that took passengers from San Francisco to Panama City. The travelers were a colorful group that exemplified every level of San Francisco society.
A fare for the voyage was not reasonable. A first-class cabin for the trip cost $300 and a second cabin ticket was $250. An inexpensively priced ticket was $150 for the steerage accommodations which was equivalent to a month’s wages for a California gold prospector who made about $5 per day.
Even those in the steerage class had money, particularly in gold rush-era California. While actual numbers are not available, many estimates their gold holdings to be in the thousands. Some travelers trusted their gold to the purser while others held theirs firmly in personal luggage, money belts or pouches.
On Thursday, September 3, the Sonora reached Panama City. Passengers, their belongings, and precious cargo were transported by the Panama Railroad for the four-hour trip by land to the Aspinwall dock. There they boarded the U.S. Mail Steamship Central America for the voyage to New York. The Central American left Aspinwall at 4 PM on that day, and the actual numbers were 477 passengers, 101 crew members, all their belongings, U.S. Mail, and tons of gold.
The steamer made the in-between stop in Cuba and departed Havana on the morning of the 8th. Seas worsened on Wednesday, September 9th when a squall came up, and the wind blew like a hurricane. By Thursday, September 10, the ship and its passengers were in a perfect hurricane, and by that evening most people were sick in their cabins. If any people slept at all, they awoke on Friday, September 11, to find a storm so violent that the ship was taking on an enormous amount of water.
Throughout the day the ship proceeded to take on water, and by that evening it was starting list to starboard causing it difficult to get coal to the boilers. If the boilers did not stay lit, the sidewheels would stop turning, leaving the ship at the mercy of the sea. With water rising in the hold, the fire rooms began to flood by late morning. Fueling the fires grew impracticable. At noon the fire under the starboard boiler went out, and steam pressure was lost. Despite strenuous efforts by the coal tenders, at about three o’clock the fire and engines on the port side also failed. With no power left, the Central America began to wallow helplessly in the sea.
In the course of the day Saturday. September 12, it was known by all that the ship was sinking. A flicker of hope arrived about noon, and a brig drew toward the sinking ship. It was the Marine, of Boston and they immediately made a magnificent effort to get women and children transferred by life raft to the Marine. Transferring by lifeboat was perilous in the raging seas, but through the day everyone fought the enormous waves to save as many as possible.
The SS Central America sank at 8 PM on Saturday, September 12, 1857, going down at a 45-degree angle, stern first. In all only 100 people were saved, but 425 perished, with most going down, in the ship with the captain, and others drowned at sea after jumping off the sinking vessel. The loss of life and the loss of this gold was, at that time, the worst peacetime disaster for America.
In August 1857, the New York office of the Ohio Life and Insurance Company closed its doors. Most New York banks were creditors of Ohio Life, and as prices fell several of those banks failed. The loss of the gold from the Central America, estimated to a value of one-fifth of the gold then in Wall Street coffers, was a significant blow to the economy and the banks of the United States.
SS Central America Gold Coins
Because the Civil War followed so soon after the sinking of the Central America, the loss of life and the gold lost was quickly forgotten. The SS Central America was, nevertheless, the most notable shipwreck of its time, relative to the Titanic in this century. In the early 1980s, new technologies were generated for sonar search and remotely commanded recovery vehicles.
The Columbus-America Discovery Group was formed in 1985 to develop the deep-ocean technology. Thomas G. Thompson, director and founder of the Central America Project, had an interest in shipwrecks and collected information on shipwrecks. In the early 1980s, Thompson assembled a partnership of private investors who invested about $12.7 million to finance the search for and recovery of the Central America. He also collected a team of scientists and technicians for the project. In 1982 Bob Evans joined Tommy as the second project director, and in 1985 Barry Schatz joined the effort.
Together they led the Columbus-America Discovery Group to locate the wreck of the SS Central America and recover gold and historical artifacts. The Central America was located about 160 miles east of Cape Hatteras, North Carolina, on the ocean bottom, nearly a mile and a half under water.
In September 1988 a remotely operated vehicle was sent down and found significant amounts of gold and other artifacts. Another ROV explicitly built for recovery brought this to the surface. It is estimated that 95% of the gold was left behind after this mission because soon after the discovery insurance companies who had lost millions by paying out claims for the disaster filled suit in several courts claiming they were entitled to the money from the find. All this was in the courts until 1990 when U.S. District Court Judge Richard Kellam declared the bulk of the gold belonged to Thompson’s crew and not the bickering insurance companies. As expected appeals followed and this was kept in the courts until 2000. Thompson’s plight never abated, and he sold his share of the California Gold Group for $52 million, which brought on all the investors who were trying to recoup their $12.7 million.
Tommy Thompson’s Disappearance
Hearing after hearing ensued which led to the disappearance of Tommy Thompson in 2012. With Thompson gone all hope that investors had to recover their money, they had invested thirty years before vanished. Federal Marshals searched for Thompson for three years, finally finding him in January 2015, with his longtime assistant and girlfriend in West Boca Raton, FL They had been staying at the same Hilton Inn for the past year, paying for their rooms with cash and using fake names. Thompson paid for everything in cash, kept dozens of burner cell phone and had a bank account under a pseudonym with a balance of over a million dollars.
Thompson has been kept in jail since his apprehension because he refuses to disclose the location of the gold that was recovered. In 2015 Tommy had arranged a deal where he would reveal the whereabouts of 500 missing gold coins in exchange for a lighter sentence. The coins are valued at $2.5 million to $4 million. At some point, Tommy changed his mind and has not revealed the location of the coins. Federal Judge Algenon Marbley from Columbus, OH in December 2016 ordered Thompson to answer questions about the whereabouts of the gold within 30 days, but he has kept mum. As of February 2018, he remains in jail in Ohio. For more on this story read this blog from oldsaltblog.com
In 2014 another group of investors hired Odyssey Marine Exploration led by Bob Evans to continue the salvage of the shipwreck. The Odyssey successfully recovered 3,100 gold coins, more than 10,000 silver coins, and 45 gold ingots. These coins, bars, and gold dust are making their way around the nation at various coin shows and coin dealer locations. My wife and I recently saw the display at the recent NRA Convention in Dallas, TX in May 2018, and I can say it is an impressive display. Some photos are seen in this article. See the video about the first time display in California in February 2018, at insideedition.com
Every coin has a story, and the coins in this collection have a very intriguing story. Could you imagine owning some of these coins? Think of the value of the coins in the shipwreck now and guess what they will be in five years. They may seem a little high priced now, but many coin collectors say a person will have a chance to double their money in two to three years, by investing in these coins.
Every portfolio manager will recommend some gold in your portfolio, to protect against inflation and the way the economy is going now, I think inflation is on the rise. We can all see it in the trucking industry alone. If wages and freight rates go up, everyone is going to pay more for goods. With rising prices and gold at the lowest it has been in several years, now would be a good time to buy. An ounce of silver is a lot less than an ounce of gold and it moves right along with the price of gold. If you do not think you can afford some gold, buy some silver. Sometimes silver will increase percentage wise more than gold.
If you are interested in investing in gold or silver read one of my earlier posts here gold-investing-strategies-silver-investment-news I know one sees a lot of these coins for sale on the internet and I strongly advise everyone not to buy coins from a website. Yes you can search for a reputable coin dealer on the web, but when it comes down to the actual buying, do your research, then call the dealers.
Hope you enjoyed this article and please leave any comments or questions below.