Spain’s Lessons for American Decline
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Spain’s Lessons for American Decline
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Re: Spain’s Lessons for American Decline
#2> But the most revealing parallels relate to a different expansionary dynamic—that of money. The key to so much else that happened to both countries was the appearance of what seemed like unlimited wealth but was actually access to unlimited quantities of a universal medium of exchange, craved and accepted everywhere.
If you can’t tell the difference between stealing a bunch of gold in a gold based economy and the US Dollar, then there is not much hope for a decent analysis.
At that time gold was the universal currency. So everyone wanted gold itself, and nobody cared where you got it from or if it was backed by anything, as long as the gold was real. So to summarize, people only cared about the material medium, not the backing of the Spanish government and economy.
With the US Dollar, nobody wants the paper or ink that is the material medium. People care about the US Dollar because of the backing of the United States and its economy. The US Dollar could be paper, plastic or digital bits. People wants what it represents, not its medium. This is exactly opposite to Spanish gold.
Re: Spain’s Lessons for American Decline
#3> But the most revealing parallels relate to a different expansionary dynamic—that of money. The key to so much else that happened to both countries was the appearance of what seemed like unlimited wealth but was actually access to unlimited quantities of a universal medium of exchange, craved and accepted everywhere. If you can’t tell the difference between stealing a bunch of gold in a gold based economy and the US…
With enough gold mines under your control, you are essentially printing money.
Re: Spain’s Lessons for American Decline
#4> But the most revealing parallels relate to a different expansionary dynamic—that of money. The key to so much else that happened to both countries was the appearance of what seemed like unlimited wealth but was actually access to unlimited quantities of a universal medium of exchange, craved and accepted everywhere. If you can’t tell the difference between stealing a bunch of gold in a gold based economy and the US…
With enough gold mines under your control, you are essentially printing money.
Not exactly because gold has an intrinsic value.
Re: Spain’s Lessons for American Decline
#5> But the most revealing parallels relate to a different expansionary dynamic—that of money. The key to so much else that happened to both countries was the appearance of what seemed like unlimited wealth but was actually access to unlimited quantities of a universal medium of exchange, craved and accepted everywhere. If you can’t tell the difference between stealing a bunch of gold in a gold based economy and the US…
That's what makes the comparison interesting. Intuitively Spanish colonial gold and contemporary US Treasury bills are very different kinds of national wealth outputs. But what if the outcomes are still the same?
Re: Spain’s Lessons for American Decline
#6> But the most revealing parallels relate to a different expansionary dynamic—that of money. The key to so much else that happened to both countries was the appearance of what seemed like unlimited wealth but was actually access to unlimited quantities of a universal medium of exchange, craved and accepted everywhere. If you can’t tell the difference between stealing a bunch of gold in a gold based economy and the US…
“ People care about the US Dollar because of the backing of the United States and its economy. ”
This may be changing. The US may have overextended its “credit line” if you will.
Re: Spain’s Lessons for American Decline
#7Earlier quoted context omitted.
With enough gold mines under your control, you are essentially printing money.
Not exactly because gold has an intrinsic value.
.. and thats the point: the intrinsic value of the US Dollar is has been declining for the last year. Gold holds its value because it can always be used for the things for which it is useful - the US Dollar, not so much.
Re: Spain’s Lessons for American Decline
#8> But the most revealing parallels relate to a different expansionary dynamic—that of money. The key to so much else that happened to both countries was the appearance of what seemed like unlimited wealth but was actually access to unlimited quantities of a universal medium of exchange, craved and accepted everywhere. If you can’t tell the difference between stealing a bunch of gold in a gold based economy and the US…
> People care about the US Dollar because of the backing of the United States and its military
Corrected that for you.
Re: Spain’s Lessons for American Decline
#9It's not an unfair assessment, marred by an identity-related political snark coming out of nowhere at about 80%. Spain really did squander its wealth. There are also differences, of course.
Spain was a real monarchy, although much of the power actually lay in the hands of one royal adviser. In case of Spain's 17th century decline, that was Olivares. But the downfall was not only overspending on warfare, but also personal ambitions (leading to infighting), rebellion (Portugal and Catalonia internally, but in colonies as well), and the ad-hoc structure of financing. The monarch was paying the army out of his own pocket. Lending, tax evasion and consequently renewed taxation formed a death spiral, certainly when the imports from South America faltered (a direct consequence of the war).
So if there's a lesson, it's: structural reforms should be made well in advance. But that lesson can be learned elsewhere, too.
Re: Spain’s Lessons for American Decline
#10Earlier quoted context omitted.
With enough gold mines under your control, you are essentially printing money.
Not exactly because gold has an intrinsic value.
> Not exactly because gold has an intrinsic value.
Gold has zero intrinsic value. Like all forms of money, its value is a psychological and sociological construct to treat it as if it had value.
The Incas for example simply used it for religious and ornamental purposes:
* https://www.tourinperu.com/blog/inca-gold-culture-invasion-r...
Anything can be used as money, including giant rocks: