From the handbag on her arm came needle, thimble, thread, and scissors, and from the clothing of her little ones the necessary red, white, and blue cloth. Under the direction of the young officer she soon had a very fair-looking flag, and beneath its folds the party marched into the town. That night the band of the flagship Congress serenaded Mrs. Bandini in her San Diego home, and the next day Commodore Stockton called to thank her in person. The flag, it is said, he sent to Washington, where it is still to be found with other California trophies. The most severe battle of the war in the state of California was fought on the San Pasqual rancho in San Diego County. The forces engaged were those of General Andres Pico, who commanded the Californians, and General Stephen Kearny, who had marched overland, entered the territory on the southwest, and was on his way to join Stockton. Hearing that the country was conquered and the fighting over, the American officer had sent back about two hundred of his men, but he was afterward reinforced by Captain Gillespie and fifty men sent by Stockton to meet him. Several American officers were killed in the battle of San Pasqual, and their brave commander severely wounded. Commodore Stockton, on his march from San Diego to Los Angeles, twice engaged the enemy, once at the crossing of the San Gabriel River and once on the Laguna rancho just east of the city. The Californians behaved with great bravery. All of them were poorly armed, many having only lances and no fire-arms, and what powder they had was almost worthless; yet three times they dashed upon the square of steadily firing United States marines. This was the last battle in the territory. The Californians retreated across the hills to the present site of Pasadena. Here, at the little adobe house on the banks of the Arroyo Seco, they separated. General Flores, their commander, was to ride with his staff through the stormy night, down El Camino Real toward Mexico. General Andres Pico, upon whom devolved the duty of surrender, was to ride with his associates to the old Cahuenga ranch house, the first station on the highway from Los Angeles to Santa Barbara. There he met Captain Fremont, and the treaty was signed which closed hostilities. The terms proposed by Fremont were favorable for the Californians and did much to make way for a peaceful settlement of all difficulties. Chapter VII At the Touch of King Midas It was by chance that gold was discovered in both northern and southern California, and by chance that many great fortunes were made. Juan Lopez, foreman of the little ranch of St. Francis in Los Angeles County, one morning in March, 1842, while idly digging up a wild onion, or brodecia, discovered what he thought lumps of gold clinging to its roots. Taking samples of the metal, he rode down to Los Angeles to the office of Don Abel Stearns, who recognized it as gold.