I read a while bacl that Central Banks almost NEVER ship gold bullion to eachother-the insurance premuims are too high! I also understand that goldbullion is regularly exhanged in the basement of the federal reserve Bank in NYC-a forklift operator moves a pallet of gold bullion from an area marked US, to and area marked France (when the Frech Central Bank wants to redeem dollars for gold). How would we KNOW that any actual transfer of bullion was taking place at all?
Links snipped, but thank you. I was getting a bit frustrated by the, um, vernacular quality of them, but I read them before going on to the rest of your resp. I was aware of much of the other information. I do not particularly like Columbus, but that has nothing to do with the revolutionary nature of his voyage (as far as Europeans were concerned), nor of its drastic effects on the indigenous peoples. I have filed the bookmarks, in case I have future recourse.
No joke!
I have put this book into my search list, to buy when I find a copy that fits my purse, mostly because I am currently reading about the history of Islam, from the 7th century through the 16th. I assume that its primary value to me will be its bibliography, but one never overlooks minor resources, any more than a prudent mathematician overlooks “trivial roots” to an equation. However, I do take note that this author is the kind of professor who “popularizes”, in addition to writing serious academic works, as seen from the list of his other books from an author search on Amazon.
As I search further, I have linked through this author to other authors, and to, among others, a book on economic history which I believe I shall wish even more to own. Not to mention others that look very interesting, as I link from book to author to book, etc. Thank you, thank you!
Of course, the fact that Isabella didn’t hock the crown jewels is trivial to the overall issue. The fact that she did have to borrow money is paramount to the issue at hand. It (along with the formulation of Gresham’s Law, as Thomas Gresham was attempting, a hundred or so years later, to persuade Elizabeth I to stop debasing the English currency - I’m not going to continue searching and revising, so I’m assuming that this was perhaps how she was funding some of the noble privateers who were out trying to gain Spanish gold) is an excellent indicator of the scarcity of liquid capital for even the rulers of most European nations, prior to the arrival of the bulk of precious metals and jewels which soon began to stream back across the ocean.
Although Ferdinand and Isabella ruled their kingdom, they did not have the means to finance the voyage themselves. Which is the point I was making. They were land- and people-rich, and money poor. This economic depression had continued from the time when the Roman empire in Europe fell to the combination of ill-advised Roman land and tax laws with multiple barbarian invasions, as I said before. There is no telling how long this state of economic and, to a lesser extent, intellectual stasis would have continued without the rise of Islam, which, as it conquered various lands and “liberated” the treasures of its defeated opponents, fostered the rise of trade. It was trade by such clever and rapacious merchants as were produced in the cities of Genoa and Venice which began to undo the economic stasis. (If you want a view of how these merchant-ruled cities were viewed by some of their {Christian} Balkan victims, I recommend to you Rebecca West’s Black Lamb and Grey Falcon.) And it was the tales of treasure in Asia, mostly told by Arab traders, which awakened the avarice of Europe’s nobility, and made them dissatisfied with living on what they could grow and make themselves. Greed can be a powerful motivator.
I do not claim that there was no progress or change during that era. However, the vast majority of the changes that occurred originated within the Church, primarily within the monasteries. Such wealth as was available other than through trading flowed into the hands of the church, especially into the monasteries and convents. After all, that was where the nobles sent at least one of their sons, if they had more than two. And daughters with no suitors, or no desire to marry, and parents willing to humor them. These children brought endowments with them; the sons cash according to what a given son might have received at his father’s death, and a daughter, the dowry she would have had at marriage. I won’t go further into other income sources, but they were there, and it was the wealth of the religious orders, together with the time for study and reflection meant that most scientific advances came from them. After all, without magnet-based compasses, it would have been very difficult for the voyages of exploration to take place.
Had Columbus actually reached India, China or Japan, he would not have been able to conquer any of those with impunity. The local rulers would have had soldiers, with both armor and experience [COLOR=Sienna](bear in mind that the guns of the era were not significantly more dangerous to opponents than to their users, much of the time). :smack: The nobles and officers carried swords; cavalry also carried swords, and the foor soldiers were generally armed with pikes. IOW, unless he had fortuitously landed at some remote area, he would have faced armed representatives of the local rulers. If in a remote area, it would have taken a bit longer, but it would not have been an uncontested acquisition.
Also please remember that the mindset of Columbus and those with him who also posessed some status was based primarily on their culture’s experiences with the Muslims (who still held parts of the Iberian Peninsula). I have little doubt that any of them would have been prepared to fight with an army (or part of one), had it shown up. They would have blustered, certainly, but his primary interest was trade. He was, of course, also interested in converting the “heathen” to Christianity; the Inquisition was in full force. Even had he not been a devout Christian, knowledge of how the Church viewed those who were not aggressively evangelical, to borrow a term, worked to imbue a certain politic enthusiasm into all those who came in contact with non-Christians.[/COLOR]
I am puzzled about the answers given to the question originally posed in that “ancient civilization” has now been defined as several centuries ago and not thousands. :eek: 
I’m surprised they actually bother to do that. It’s my understanding that, just like if you were to buy gold in large quantities, they just hold it in a warehouse and issue a receipt of ownership. When you want to sell essentially someone sends you the money and you transfer the receipt (or portions thereof).
You know because the receipt says that you’re the owner, same way as if you do direct deposit or pay your bills online.
Um, well. I looked back at my first post, and I believe it was an answer to the OP. But then others took issue with some of my arguments, and dragged it into something else.
:eek:
I beg forgiveness for participating in such a broad excursus. I plead enticement.
Well, yes :). I imagine it is rather easier to think about adapting modern economic theory to 16th and 17th century Europe which with its emerging international banking system really wasn’t so vastly unsophisticated compared to today.
However largely unschooled in economics though I am ( which is why I have been prudently trying to avoid posting in this thread ), I think I could certainly point to some genuinely “ancient” societies that could have benefited from a good econ 101 class.
Case in point, Achaemenid Persia. The Persian empire was vastly wealthy and took in enormous sums in tribute and land revenue each year. Said tribute had to be paid in hard currency ( silver mostly, gold as it was available ). The Achaemenid Shahanshahs rather enjoyed their loot and the power it represented and thus sat on most of it. Small amounts were minted and/or re-circulated by the royal treasury, but even then mostly to pay for mercenaries ( in the latter part of the empire ) or to bribe foreign dignitaries ( a handy political tool if you have that much monetary muscle ). The greater part of this annual take was melted down and stored as bullion in Perseopolis ( mostly ).
Which is why Alexander’s conquest of Perseopolis and sacking of the royal treasury there was such a huge deal - it was a truly massive accumulation of precious metals unequaled in the world. It helped finance not only Alexander’s considerable extravagances, but also much of the generation of civil war that followed his death. Indeed it has been argued that its release into the “world” economy of the time stimulated a significant economic boom as Alex’s soldiers and the Diadochi’s mercenaries spread it far and wide.
However the Achaemenids habit of sucking up specie like a giant royal hoover and not re-releasing certainly caused great economic distress, which only served to ultimately weaken the state. Even with new production from mines, the amount of currency available in the Persian market shrank steadily over time. And as the Achaemenids still demanded payment in currency, desperate landlords increasingly had to turn to loan sharks to make tax payments. Since the loan sharks leverage was predicated on having a supply of cash, they hoarded it. The result as I understand it ( and I might be missing a couple of steps here, I don’t have a reference in front of me at the moment ) was a double-whammy of serious inflation and ever smaller amonuts of available cash.
'course you needn’t go so far back to find similar examples. The first Saudi monarch to get oil income locked most of his profits in iron coffers, rather than invest it - he wasn’t far removed from the desert ;).
As for the immense amounts of bullion pulled out of the new world in 16th and early 17th century - they didn’t do Spain, Portugal, or the Ottomans any favors. The cash artificially propped up Spanish Hapsburg imperialism, but the combination of massive inflation and unrealistically enormous military expenditures ( in concert with other issues ) helped destroy the economy of Castille and not incidently severely wound the heavily silver-based Ottoman state. Charles V, Philip II, Philip III and Philip IV were always desperately short of money - the New World riches didn’t even come close to meeting their financial obligations and they taxed and hocked their empire into the ground. As noted the real economic beneficiaries were to be found elsewhere in Europe. Even then Italian and German bankers suffered some occasional serious body blows as the Hapsburg crown periodically went bankrupt and defaulted on its huge loans. Actually one of the biggest ultimate beneficiaries of the New World mines was 17th-19th century China, to which a truly staggering amount of that silver went to buy luxury goods ( and the then immense and fully self-sufficient Chinese economy, where the internal trade dwarfed the petty foreign earnings, readily absorbed it ).
Now the later Spanish Bourbon silver boom in Zacatecas did help re-build that tottering state in the latter half of the 18th century. On the other hand the Brazilian gold boom, the peak years of which almost exactly coincided with the reign of King John V of Braganza, made ole’ John the wealthiest monarch in Europe, but singularly failed to do much for the woeful Portuguese economy. Investments were scattered and poorly thought out and much of the money was squandered building places like the Malfra or funding the insanely lavish twin marriage celebrations between the Portuguese and Spanish crowns. The biggest benefactor there was England, which profited enormously from an imblance of trade, as Portuguese exports of wine didn’t come close to equalling the boom in demand for English finished goods fueled by the new found wealth.
- Tamerlane
Actually I should say 16th-18th century Chine. By the second ( Ibelieve ) of the 19th the opium trade had reversed that trade imbalance and silver began flowing out China at a rapidly mounting rate.
- Tamerlane
And others who may have found my blanket condemnation yesterday offensive.
:o
I had not planned to logon again today, but my conscience began beating me about the head and shoulders.
It is wrong to condemn an entire class of people based on the behavior of a prominent few, just as wrong as it is for those few to lie, steal and cheat in order to amass wealth.
Every so often, I get my chain yanked to remind me that I am not anyone’s judge. :smack:
Catalyst, if you’re still interested in this 5 year old question,
you should go buy or borrow this book:
it’s fantastic.