As the dwarves get closer to their long-lost treasure, they become more stubborn (as when they refuse to talk to the Elvenking), and they make poorer decisions (as when they leave the path in Mirkwood). They have come to rely almost entirely on Bilbo for common sense and for salvation from the results of their own blunders, and the dwarves’ increasingly hardhearted haplessness gives Bilbo no choice but to further develop his newfound qualities of initiative, courage, and heroism. Bilbo is concerned about the next step of the quest, but all he can do is get the greedy dwarves away from the gold in Smaug’s chambers so they can look for a safer place to rest. His frustration with the dwarves’ stubborn recklessness prompts Bilbo to take and conceal the Arkenstone, the gem that Thorin covets.
Although Bilbo’s motives for taking the Arkenstone are unclear, the narrator explains the dwarves’ eagerness to plunder by telling us that the one love of all dwarves is money. Whether dwarves are good or bad, one cannot expect much more from them. This is not exactly glowing praise, and as the tale progresses and the dwarves’ greed leads them to increasingly arrogant and foolish behavior, we are inclined to feel even less sympathy for dwarves and even more sympathy for Bilbo. The treasure fills Thorin, in particular, with pride and stubbornness, but despite his lofty rhetoric, he fails to offer any practical plan for dealing with the dragon. Like the other dwarves, he leaves this problem entirely to Bilbo while continuing to act like the party’s unquestioned leader.
Smaug’s character fuses elements from ancient epic literature with far more modern traits. Smaug has all the characteristics of legendary dragons, including an armorlike scaled hide, a love of treasure, and the ability to breathe fire. However, he also possesses a dark sense of humor that is thoroughly modern and an almost magical gift of speech that allows him to glean more information from Bilbo than the clever hobbit intends to give. His speech is so persuasive that he even makes Bilbo doubt, briefly, whether the dwarves are actually going to give him his share of the profits. This doubt may also play a role in Bilbo’s decision to keep the Arkenstone.
In Chapter 13, Thorin’s explanation for the thrush’s interest in Bilbo’s information about Smaug’s weak spot is not idle talk. Thorin says that certain birds in the area were once used as messengers because of their peculiar ability to communicate with certain men. Thorin’s comment foreshadows the dramatic events of the next chapter, in which Bilbo wins over the dragon in a battle of wits. Once again, Gandalf is proven wise for having foreseen that a simple hobbit could succeed using cleverness whereas a mighty warrior would have likely failed using might.