Bilbo finds himself, he believes, on the other side of the Misty Mountains, but without Gandalf or the dwarves. As he wanders through the woods down the slope, he fears they are still in the tunnels of the goblins. He is just about ready to turn back when he hears voices and sees Balin doing look-out. But Balin doesn’t see him because he is still wearing the ring (101–102).
Bilbo listens at the edge of the circle to their arguments about why they had brought him (Gandalf on one side, the dwarves on the other), why Dori had dropped him and left him (you would have too, Dori had said, amidst all that fighting), and if they were going back to try to find him (Gandalf again on one side and the dwarves on the other), when Bilbo appears in their midst. Everyone is much relieved; Balin is much chagrined (102–103).
Bilbo begins to tell his tale, but he manages to leave out the part about the ring, which ultimately makes his escape that much more dramatic. Gandalf looks at him askance, and Bilbo wonders if maybe Gandalf guesses that there’s more to the story. Then it is Gandalf’s turn to tell his tale of how he disappeared and reappeared at the right time. Gandalf had squeezed in the gate right before it was closed, followed them down to the great hall, and then worked up a bit of magic that got them all free. He tells them that he was well aware of the back gate, as most people were, so it was just a matter of leading them to it once they escaped from the goblins. Gandalf then tells them of their need to be getting on—goblins will be out soon as the sun sets—and how much time has passed in the tunnels—two whole days plus (103–106).
Bilbo, despite being “dreadfully hungry” is forced to move on to get clear of the most certain goblin pursuit. The party coming down a rocky, pebbly slope, nearly are swept away by a landslide. They continue on deep into the night until they come to a clearing. And then they begin to hear the wolves howling (107–109).
Bilbo invents a proverb: escaping goblins to be caught by wolves, and everyone scrambles up a tree—except Bilbo who can’t reach any of the branches. Dori gets out, helps Bilbo up, and barely escapes being a warg snack as the glade fills with wild wolves. Gandalf understands their speech, and so this is what he hears: As it turns out the goblins and wolves are supposed to meet here this very night for a raid of some of the new villages nearest the mountain where men have been moving back in. Gandalf realizes the predicament they are in, and he begins sending magically lit pine cones down on the wolves and causing commotion—and pain (109–114).
At this point, the Lord of the Eagles hears the racket and wonders what is up, so he takes others with him to go and discover the reason for the clamor. In the meantime the wolves are running around setting the forest on fire and the goblins show up. They begin putting out some fires but building up others around each of the tree where the dwarves and Bilbo and Gandalf are. And then they begin to sing. As the trees where they are begin to catch fire, Gandalf intends to leap down in one last show of force, and hopefully kill several goblins in the meantime. But he almost assuredly will be killed as well. Yet right before he leaps, the Lord of the Eagles grabs him in his talons and takes off (114–117).
Gandalf alerts the The Lord of the Eagles of the rest of his party, and he calls to others, who soon rescue everyone. Bilbo is almost left again, but manages to grab hold of Dori’s legs at the last moment. And at the last moment before Bilbo’s arms give way, they are deposited high up in an eagle’s eyrie. As he and Dori talk, an eagle flies up and tells the eagle guarding them to bring his prisoners. They get deposited with the others on a high cliff as Gandalf is talking with the Lord of the Eagles (117–120).
Bilbo (and the dwarves) learn that Gandalf knows the Lord of the Eagles and at one time had rendered him service. Prisoners meant prisoners of the goblins not of the eagles, and the Lord of the Eagles agrees to take them well past the mountains and help them on their journey. The eagles are also nice enough to bring them food, and Bilbo, full of stomach, sleeps soundly on the hard rock but dreams of his hobbit hole back home (120–121).