the ascent of money, page-10

PP

The mining of gold and silver did not ruin the Spanish economy.

It made Spain very wealthy and enabled them to build a vast empire.

The gold and silver that Spain got from the New World enabled Spain to buy goods from all over Europe.

However, the added silver led to inflation in both Spain and across Europe. As Spain was minting the silver coins (much like the US has been printing paper money that is used by others) it benefited most from the increased silver/gold.

The decline of Spain had more to do with the rise of England and others (Dutch) that challenged its sea power and raided its wealth. France became more unified and through its larger population had a much bigger army.

Like any empire eventually the colonies became powerful enough to break away. Mexico did this as well as all the South American colonies.

The other effect of empire is that a lot of the best and brightest went overseas and the remaining population was not as energentic as past generations. They did not innovate like the British so their industrialisation was delayed, while the future wealth was increasinly based in the trade of manufactures. The Spanish simply became lazey and lived off their empire until it was lost or taken away from them.

loki