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At Rough and Ready Folsom found the populace as "rough" as the hills on which they lived and "ready" with their guns and ropes. They attempted to establish a fabulous state, independent of the United States Government, and secede from the jurisdiction of the same. That was definitely not to Folsom's liking. Although he had suffered from mob violence and lack of governmental cooperation in Nauvoo, he would have no part in a secession movement. He left Rough and Ready and went to Coyote Diggin's, which, along with Red Hill and Rich Gulch, was located in Eldorado County on the north side of the south fork of the American River. Altogether, including Mormon Island, this was called Michigan Flat. For a time the dirt from which the gold was extracted was hauled to Deer Creek to be washed. Then someone conceived the idea of digging a ditch to carry the water from the river to the digging. This called for a survey and plenty of shovel work. Supervising such work was no problem for Folsom, as he states in the Bancroft document. Soon other groups or companies decided to use the same plan and as a result, appropriated the water claimed by prior right. At that time there were no "prior rights" in California. Every man helped himself to what he found where he found it. But the time arrived when a registration of claims took place, in order to establish some standard of ownership. A lawsuit was filed and executed. No doubt it was a primitive affair, but it had the "order of the court!1 behind it. When all negotiations were completed, the clerk of the court recorded the decision, but made no mention of all the parties involved in the proceedings. There was a sale of the property and canal right, according to information given by William H. Folsom, for which he received "much money." He evidently had something to sell. He was paid in gold nuggets and octagon gold pieces which were being minted at that time. Some of each remained in the family's possession for several years. Folsom had no desire to remain for further gain. He had enough money to purchase equipment for the trek to the Salt Lake Valley. His greatest desire was to "be out of that environment" and at home with his family.
Negotiations and contracts for a railroad across the Panama Isthmus were com111eted in 1850, and the road was partially built by the time he was ready to leave San Francisco in 1852. However, reports of murder among those attempting to, take their gold back to the States by that route were so prevalent that he decided to take passage for Hawaii and around the Horn in order to get home. . This was a commonly-used route at that time and it meant that he would be landing at Philadelphia. So he sent word for his wife to meet him at the home of her parents in Atwater, Ohio. Before retiring for the night on the vessel, he knelt and thanked his Maker for the preservation of his life. He had seen more then he cared to remember of a mass of humanity gone mad over gold. Exhausted, he lay on his bed in his cabin, feeling that he had had no rest for years.
The trip to the Islands was quite pleasant and interesting, but from the Islands and through the Strait of Magellan was a terrifying experience. If the weather is calm where the Pacific and Atlantic Oceans meet, the scenery through the Strait is beautiful, but winds of high velocity prevailed at the time the vessel carrying Folsom made its way through the channel. From Sir Francis Chichester's description in Life Magazine, June 9, 1967, we learn that the Captain and all of the crew were taxed to the limit of their strength to bring the vessel through the rocky outcroppings which .form part of the southern extremity of South America, All passengers were greatly relieved when they learned that the ship was safely on its way northward.