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It is important to remember the context of this remark. Ergstrom is telling the narrator the story behind Jim's decision to leave working for the company. He tells him that it was one day when Captain O'Brien began to make offensive remarks about Indians, calling them "skunks," that Jim made his decision to go. Ergstrom himself humoured the Captain, who he could see was drunk, by making remarks that showed he was in agreement with the Captain's derogatory views on Indians. Then, after this, Jim made his declaration, which was misinterpreted at first by Ergstrom:
And then, sir, that blasted Jim he puts down the sandwich he had in his hand and walks round the table to me; there was his glass of beer poured out quite full. "I am off," he says- just like this. "It isn't half-past one yet," says I; "you might snatch a smoke first." I thought he meant it was time for him to go down to his work. When I understood what he was up to, my arms fell- so! Can't get a man like that every day, you know, sir; a regular devil for sailing a boat; ready to go out miles to sea to meet ships in any sort of weather.
Ergstrom therefore believes at first that Jim is going to just pop out for a cigarette, as he can't believe that a man would just leave so quickly wthout much provocation. However, he quickly realises that Jim is serious about leaving employment with his company, and is saddened as a result.
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