In this pivotal chapter of The Hobbit, tensions rise significantly following the events at the Lonely Mountain. After Smaug's defeat, the dwarves, led by Thorin Oakenshield, now find themselves in possession of the treasure within the mountain. However, Thorin's attitude becomes increasingly possessive, and he expresses a vehement refusal to share any part of the treasure with others, especially with the men of Lake-town and the elves of Mirkwood, who are rightfully concerned about their own interests.

As news of Smaug's demise spreads, representatives from Lake-town arrive at the mountain, seeking a share of the treasure in gratitude for the assistance they provided. They argue that they helped the dwarves by slaying the dragon, thus allowing them to reclaim their homeland. Thorin, however, dismisses their claims, adamantly asserting that the treasure belongs solely to his kin and refuses to recognize any obligation towards those who helped them.

The chapter elaborates on the growing discontent among the men and elves, who feel slighted by Thorin's selfishness. A sense of foreboding fills the air as it becomes clear that Thorin's greed is blinding him to the potential for unity and cooperation among the different factions. The dwarves, who once fought alongside these people against Smaug, now find themselves at odds with those who had supported them.

The atmosphere becomes charged as Bilbo Baggins, who has undergone significant character development throughout the journey, finds himself in a moral dilemma. He understands the importance of sharing and community, in stark contrast to Thorin's stubbornness. Bilbo decides to take matters into his own hands when he discreetly gives a portion of the treasure—a valuable Arkenstone—to Bard, the leader of the men of Lake-town. He hopes this act will serve as a bargaining chip to negotiate peace and avoid conflict over the treasure.

As the chapter progresses, it becomes evident that the dwarves' refusal to share the treasure could lead to conflict. Bard and the elves are prepared to take action, believing that they have rights to the treasure, which could escalate into a confrontation. The chapter closes with a palpable sense of tension, foreshadowing the inevitable conflict that may arise from Thorin's obstinate decision and the growing discontent among the allied parties.

Overall, 'The Gathering of the Clouds' serves not only as a critical turning point in the narrative but also highlights the themes of greed, the consequences of pride, and the importance of community. Bilbo's quiet bravery and willingness to act for the greater good contrast sharply with Thorin's possessiveness, setting the stage for the events that will follow in the ensuing conflict.