A man named Sutter had moved from Missouri to California.  He built a house which was called Sutter’s Fort.  It was where the city of Sacramento now stands.  Sutter had many horses and oxen, and he owned thousands of acres of land.  He traded with the Indians, and carried on other kinds of business.

But everything was done in the slow Mexican way.  When he wanted boards, he sent men to saw them out by hand.  It took two men a whole day to saw up a log so as to make a dozen boards.  There was no sawmill in all California.

When Sutter wanted to grind flour or meal, this also was done in the Mexican way.  A large stone roller was run over a flat stone.  But at last Sutter thought he would have a grinding mill of the American sort.  To build this, he needed boards.  He thought he would first build a sawmill.  Then he could get boards quickly for his grinding mill, and have lumber to use for other things.

Sutter sent a man named Marshall to build his sawmill.  It was to be built forty miles away from Sutter’s Fort.  The mill had to be where there were trees to saw.

Marshall was a very good carpenter, who could build almost anything.  He had some men working with him.  After some months they got the mill done.  This mill was built to run by water.

But when he started it, the mill did not run well.  Marshall saw that he must dig a ditch below the great water wheel, to carry off the water.  He hired wild Indians to dig the ditch.

When the Indians had partly dug this ditch, Marshall went out one January morning to look at it.  The clear water was running through the ditch.  It had washed away the sand, leaving the pebbles bare.  At the bottom of the water Marshall saw something yellow.  It looked like brass.  He put his hand down into the water and took up this bright, yellow thing.  It was about the size and shape of a small pea.  Then he looked, and found another pretty little yellow bead at the bottom of the ditch.

Marshall trembled all over.  It might be gold.  But he remembered that there is another yellow substance that looks like gold.  It is called “fool’s gold.”  He was afraid he had only found fool’s gold.

Marshall knew that if it was gold it would not break easily.  He laid one of the pieces on a stone; then he took another stone and hammered it.  It was soft, and did not break.  If it had broken to pieces, Marshall would have known that it was not gold.

In a few days the men had dug up about three ounces of the yellow stuff.  They had no means of making sure it was gold.

Then Marshall got on a horse and set out for Sutter’s Fort, carrying the yellow metal with him.  He traveled as fast as the rough road would let him.  He rode up to Sutler’s in the evening, all spattered with mud.

He told Captain Sutter that he wished to see him alone.  Marshall’s eyes looked wild, and Sutter was afraid that he was crazy.  But he went to a room with him.  Then Marshall wanted the door locked.  Sutter could not think what was the matter with the man.