Thanks ckilmer.
This galleon story is one of many reported here at FreeRepublic. What they show is that about 1550 the Spanish developed a new technology (byo a Bavarian mining engineer) using Mercury to extract gold and silver from Mexico and the Andes. Over two centuries from 1550-1750 they extracted enormous wealth from the new world. When the gold and silver ran out—spain went into decline.
But in the meantime that new wealth in the early 1600’s was behind the shift in the culture that lay behind Cervantes tale. That wealth was what caused the first bubble economy in Holland with the tulip craze. Even as late as the 1750’s spanish pieces of eight were accepted currencies in American colonies.
But in the end —gold and silver—like oil or coal or iron are resources. Spain was a resource country. It did not learn to develop new industries after the 1750’s to create new value so the country went into relative decline compared to the rest of Europe.
These days of course Spain like everyone else is on a giant learning curve.
Thanks ckilmer.
