In Thorin’s explanation of the terrible disaster that occurred in the mountain where generations of workers came together, they had found great fortune and fame within the many jewels and amounts of gold. They crafted beautiful treasures and became very well-known, Kings and lords hired them. However, this increase in popularity led to the destruction that the dragon, Smaug, caused. Dragons love to steal jewels and such, however they never use any of it and simply guard it until the get killed. He burned anything in his way and ate most of the humans that lived in Dale as well as the dwarfs working in the mountain, Thorin and his grandfather lived through the attack. Nobody lives near the mountain anymore but the dwarfs want their treasures back.
Some dwarfs used to work inside a mountain near the city of Dale, where they made swords and necklaces from jewels.
Kings and lords hired them to make these things and paid them lavishly.
All was well until their fame grew and attracted the dragon Smaug. He burned everything and ate most of the people.
Luckily, Thorin and his grandfather lived through the attack and were able to carry the story on.
Smaug guards the jewels and does nothing but sleep on them.
The dwarfs want their fortune back, however, and are willing to do anything for it.