bales from Dubuque to feed the horses of St. Paul, when there
were millions of tons of it growing in the Minnesota valley, within a
few miles of the city.

In the progress of emigration to the West, the territories have always
presented the greatest attractions. The settler expects to have a better
choice of lands, and at original government prices. Society and politics
are both in the formative condition, and very few emigrants omit the
latter consideration from their hopes and expectations. In fact,
political preferment is a leading motive with many of them.

Under the influence of this great rush of immigration it is very natural
that the prevailing idea should be that lands would greatly increase in
value in the near future, and everybody became a speculator. Towns and
cities sprang into existence like mushrooms in a night. Scarcely anyone
was to be seen without a town-site map in his hands, the advantages and
beauties of which fictitious metropolis he was ready to present in the
most eloquent terms. Everything useful was neglected, and speculation
was rampant. There were no banks of issue, and all the money that was in
the country was borrowed in the East. In order to make borrowing easy,
the law placed no restrictions on the rate of interest, and the usual
terms were three per cent per month, with the condition that if the
principal was not paid at maturity, the interest should be increased to
five per cent per month. Everybody was in debt on these ruinous terms;
which, of course, could not last long before the inevitable explosion.
The price of lands, and especially town lots, increased rapidly, and
attained fabulous rates; in fact, some real property in St. Paul sold in
1856 for more money than it has ever since brought.

THE PANIC OF 1857.

The bubble burst by the announcement of the failure of the Ohio Life
Insurance and Trust Company, which reached St. Paul on Aug. 24, 1857.
The failure of this financial institution precipitated a panic all over
the country. It happened just on the recurrence of the twenty year
period which has marked the pecuniary disasters of the country,
beginning with 1837. Its effects on Minnesota were extremely disastrous.
The eastern creditors demanded their money, and the Minnesota debtors
paid as long as a dollar remained in the country, and all means of
borrowing more being cut off, a most remarkable condition of things
resulted. Cities like St. Paul and St. Anthony, hav