Below are the 15 most recent journal entries recorded in katiecat's InsaneJournal:

Wednesday, July 23rd, 2008
11:20 am	The Impact of the Production of Precious Metals The impact of the production of precious metals in the central areas as well as the trade that linked the indigenous economies with international markets meant that interregional and intraregional integration was not as strong as conceived by traditional historiography. Furthermore, the increase in the production of precious metals during the second half of the eighteenth century may not have been as great as traditionally believed. The scholar J. H. Coatsworth has noted that the growth in this sector began not at the end of the century but at the beginning of the 1720s. Reducing the total of the mint according to the price index, he discovered that the mining industry was faced with serious problems at the end of the colonial period to the point of falling revenues. The production of a kilogram of silver was more expensive at the end than at the beginning of the eighteenth century owing to increases in the cost of production (deepening of the mine shafts, the need for greater investment, the rise in the cost of money) at the same time as the value of silver in international markets dropped. Thus the mining industry survived in the second half of the eighteenth century largely because the Crown agreed to favor it with tax exemptions while maintaining control over the prices of such vital products as gunpowder, cereals, and mercury. Traditionally it has been emphasized that growth in the mining industry was favored by the Crown's protectionist measures that drove the economic recovery and intensified the integration in spatial terms of the northern areas of the colony. Nevertheless regional analysis makes it clear that without taking away the importance of silver production, the reality was rather more complex. (Comment on this)
11:19 am	Export Trade in Spain Commercial pressure groups in Spain (notably the Consulates of Cádiz and Seville) tried to control the benefits of export trade from the American colonies in every way, with diverse results. For example, the Real Compañia de Filipinas (The Royal Philippine Company) was created in 1785 to connect the port of Manila directly with that of Cádiz and thereby eliminate both the Manila Galleon (which linked Manila to Acapulco) and the traditional control over this traffic exercised by the colonial merchants. Arguments soon erupted between the suppliers based in the Mexican Consulate and the Andalucian shipowners. As regards intraregional flow, the growth that might have been expected never fully materialized. True, there was demographic expansion, urban concentration, and development in the mining sector. Nevertheless, the market was not present to support and take advantage of these developments. Bartering increased and local self-sufficiency was widespread. The migration from the country to the town did not take place in the context of a manufacturing sector that could absorb such a labor force; thus, urban concentration brought not an upswing in commercial transactions and scale economies but rather an increase in unemployment and poverty. By the end of the eighteenth century, increased taxation pressure and inflation reduced available revenues. The reduction in real salary (at fixed prices) and real disposable income (net salary after tax) indicated an over-exploitation of labor; consequently, the demand for secondary and tertiary products did not increase, making it impossible for the internal market to extend either horizontally or vertically. Some self-sufficient campesinos (peasants) could not increase their consumption via the market, and the urban workers scarcely had sufficient income to feed themselves, having to use their family connections in the country to cover their most immediate necessities or migrate and thereby go back to self-sufficiency. The hacienda owners, on the other hand, did not see any necessity for investing in new technology in view of the drop in relative terms of the cost of labor. In turn the growth of currency exports by the Royal Exchequer limited public spending on American soil, and the increase in the export of goods metamorphosed into a process that bled the American economies of legal tender (the extraction of currency was higher in some years than the total production of the mint). It appears to be no accident that the speed of monetary circulation (via bills of exchange, drafts, money orders, compensatory payments) had to increase by the end of the eighteenth century to compensate for the drain on payment methods imposed by the new colonial policy. Growth in terms of foreign trade meant poverty for internal markets. Population increase in the central areas was not as intense as traditional historical accounts have indicated. From 1650 to 1690, annual rates of population increase have been given as 2 percent; between 1690 and 1736 they oscillated between 0.33 percent and 2.9 percent and from 1737 results became negative. (Comment on this)
11:19 am	Trade and Markets: Bourbon New Spain During the eighteenth century various events coincided to modify the volume of goods exchanged through external, interregional, and intraregional trade routes in Viceregal New Spain; these events also modified the destination and composition of these goods to a large extent. Each one of these commercial sectors, although interconnected, responded to an individual dynamic that makes it impossible to establish a common rule of behavior or disentangle cause and effect. It must be recalled that although an increase in the global volume of foreign trade between the Iberian peninsula and New Spain is historically documented and has been constantly restated by historians, it is still necessary to be cautious regarding the level of this increase. Although the increasing number of ships that officially left and entered the Spanish ports may be taken as an indicator, it must not be taken as a faithful reflection of reality. On the one hand, the rise in traffic via legal channels correspond to a clear decrease in contraband; on the other hand, the volume of vessels during the century was reduced to increase speed, so more boats were required to transport the same merchandise than previously. Furthermore, when looking at data on the growing sums paid in excise duties, insurance, or any other tax relating to foreign trade, the inflationary process at the end of the eighteenth century must be taken into account; higher prices can be confused with increased trade. This trend toward an increase in foreign trade was basically owing to an increase in international demand (the economic expansion of European economies), faster transactions, reduced transport costs (a decrease in the cost of freight and insurance), and speedier productivity (the Spanish Crown favored those manufacturing sectors orientated toward export with tax benefits). The increased volume of foreign trade also brought a change in the interregional or intraregional areas. Official data prove that prior to the ruling on commercial liberalization in 1789, precious metals averaged 80 percent of the value of the export freight of the Viceroyalty, but dropped to 60 percent after commercial liberalization went into effect. In addition, the control of the old merchant bases, basically concentrated in the Mexican Consulate, tended to disperse, as typified by the creation of new consulates in Guadalajara, Veracruz, and Puebla. Each new region moved toward making direct links abroad while reducing local ties between provinces. As a result, some indigenous manufacturing bases entered crisis when faced with competition from European products, thereby undermining the partial integration and specialization that had been achieved up to that point. (Comment on this)
11:19 am	Twilight of the Hapsburg Dynasty In the 1630s and 1640s, New Spain's merchants had formed a coalition with other elites and resisted a series of tax increases imposed by the Spanish government. They objected to paying for a new Caribbean defense squadron after the king declined to grant their requests for reforms. But in 1660 the Spanish Crown did respond in part. It ended all the commercial taxes based on the value of what was being shipped and imposed instead a fixed payment on the merchants of each region in the Indies trade to finance the convoys. Imperial policy makers started to recognize that their fiscal measures hurt trade. In late- seventeenth-century New Spain, the white and mixed-race population was rising, and even the number of Indians started to increase. Silver production rose to about 55,000,000 pesos in the 1670s. The payment of fines for contraband rose from 505,764 pesos in the 1660s to 742,000 pesos in the 1670s, suggesting a revival in trade, as well. Provincial cities like Guadalajara that had once lacked capital now found cash more available and agricultural production increasing. Despite years of famine and disease in the early 1690s, New Spain's economic position improved in the last third of the century. The structure was in place to continue the path of development that New Spain was already on: an export-oriented economy with modest but resilient regional markets that stretched from Parral to Chiapas. Eighteenth-century historians disagree about when, or even if, these segmented networks of exchange became an all-Mexican market. But we can say that the seventeenth century bequeathed the potential for its emergence to the eighteenth. Carlos II, the last enfeebled Hapsburg ruler who died in 1700, has long been regarded as an apt symbol for the decline of Spain. For New Spain a good symbol is the wealthy merchant, born in the mother country but contributing to the economic recovery of late-seventeenth-centuryMexico. (Comment on this)
11:19 am	The Seventeenth-Century "Depression" The commercial triumphs of the late sixteenth century had an unwelcome sequel in the business failures of the seventeenth century. Scholars now agree that from the 1640s through the 1660s colonial Mexico's silver output slumped. Given that silver was New Spain's main export, this meant that transoceanic trade shrank and the capital it generated for investment at home also shrank. Even interregional trade with Central America or Venezuela depended on New Spain's silver. Lacking the mercury needed to process the silver ore, mine owners went bankrupt; lacking specie, merchants failed; lacking loans, sugar planters and cloth producers curtailed operations. Combined with the Indian population reaching its lowest point ever in 1630-50, and with increased attacks by foreign corsairs, New Spain seemed to be in the grip of a depression. Yet, where some historians have found depression, others have seen opportunity. With the decline of fleet sailings, contact with Spain became less frequent, and this has led to the claim that the seventeenth-century contraction presented New Spain with a chance to produce more of its manufac tured goods and assert more control over its own economy and its governance. Since registered silver declined from about 46,000,000 pesos over the 1630s to about 35,000,000 pesos over the 1640s, and remained close to the latter level for the next two decades, there was still enough to finance some production and trade. The seventeenth century may have offered a chance for a pattern of growth centered more on Mexico and possibly less controlled by an elite linked to Spain. The history of merchants and markets during these problematic years offers the best evidence we now have to address the autonomy hypothesis. Examining the history of the seventeenth-century wholesalers and their families, we do not see much change in how the economy was organized. Relative to other social groups in the elite—bureaucrats, clergy, hacendados, and mine owners—the wealthy merchants remained very important to the economy, particularly as sources of credit. Studies of Puebla, Guadalajara, Zacatecas, and Cuernavaca all confirm this. Nor did they modify their approach to conducting business. Indeed, their trade became more monopolistic and their ties with Spain remained close, as many wholesalers continued to act as commission agents for Sevillian traders. Consumers, for their part, continued to seek foreign fabrics. Even buyers with modest incomes could sometimes purchase the fine-quality but less expensive China wares. Yet, colonial Mexico's wholesalers also continued to plow some of their profits back into financing production. The same internal trends that fostered a certain degree of specialization and regional exchange before the 1630s continued during the slump. Whether total textile production expanded to compensate for lack of imports is hard to say. We know it grew in regions like Queretaro but declined in others like Puebla. It is certain that craftspeople continued to turn out clothing. Sugar producers continued to seek licenses to plant and processed their crop into sweets and cane brandy, ranchers sold their hides to make saddles and shoes and interregional trade benefited. The structure of the economy formed in the sixteenth century persisted through the contraction. (Comment on this)
11:18 am	Consolidation of Wholesalers and Markets: 1590-1630 By the 1590s the wealthy merchant community of New Spain presented a rather different picture. The viceroyalty had entered an expansive phase that saw silver production and trade reach unprecedented heights. Drawing on this success, the merchants of Mexico City finally incorporated as a guild in 1592. This legal rite of passage signified that they were now powerful enough to separate from the tutelage of the consulado of Seville. From the late sixteenth century to the mid-seventeenth their wealth and status grew, as did their involvement in New Spain. They financed or owned more productive enterprises. They built or remodeled mansions for "the great adornment and good order" of their beloved capital city. Now that many offices could be purchased, they might become public figures in local society. Some regularly coined silver for the Crown. Although we no longer share the sixteenth-century Spaniards' disdain for the public practice of trade, scholars today are critical of merchants from a developmentalist standpoint. Their often successful efforts to monopolize any trade they entered, and their practice of restricting supply so as to charge high prices, limited New Spain's growth and gave a small group of wealthy men too much economic power. They even controlled the royal mint and the money supply. Furthermore, by shipping so much of their silver back to Spain, they contributed to starving New Spain of badly needed capital for investment. The market structure that articulated this trade was based on the medieval view that the government or government-chartered corporations should determine what, where, and at which prices goods would be exchanged. In practice, there was much more flexibility, but the ideal did influence the way business was conducted. When the fleet came in, for example, New Spain's merchants purchased large lots of European goods from Spanish wholesalers or their factors at Veracruz. Prices were usually agreed upon by the major traders. There was some free dealing with lesser traders, but it was hard for an entrepreneur outside the consulado to break into the silver circle. New Spain's cities established sites for markets and licensed vendors. Municipal councils determined prices of maize, wheat, flour, and meat on a routine basis. Alhóndigas (public grain exchanges) and pósitos (public storage facilities) were established throughout New Spain from the 1580s onwards. Although the government allowed free trade in items that were not necessary to survival, the municipal authorities also could in fact set the prices of imports, such as wine, much to the displeasure of the merchants. The intention was to protect the consumer from grain and meat speculators. Historians disagree about whether government regulation accomplished this goal. Some believe the large number of indigent urban residents made price ceilings essential but note that well-meaning regulations could not compensate for low wages and unemployment. Others assert that by holding down prices, the cities discouraged agricultural production, thereby aggravating shortages. (Comment on this)
11:18 am	Spanish Colonial Merchants In the Early Sixteenth Century Who were these competitors who marginalized the astute pochteca? The wholesale merchants of New Spain have long been recognized as premier actors in the drama of New Spain's formation. It really can be said that without them, there would not have been a New Spain. Their capital and credit made possible not only the region's most important export, silver, but sugar production, silk and woolen textile manufacture, and some wheat and cattle raising, as well. They provided Europe's fine clothing, hardware, paper, glass, and books to the criollos and Hispanicized nonwhites. They transplanted Iberian and Asian material culture to New Spain. This lifestyle was then selectively imitated by all in New Spain who could afford such purchases. Shared material aspirations integrated to some degree the diverse social groups of the viceroyalty, even as the Spaniards passed sumptuary laws that limited the extent to which mixed-race plebians could actually dress and eat like the white gentle- folk. Last but hardly least, merchant loans kept the government solvent, at least most of the time. But this was not so apparent to aristocratic-minded Spanish society, Sixteenth-century Spanish values placed the merchant well below the gentleman and not much above the artisan. Because he was more likely than other immigrants to be of foreign origin—Italian, Flemish, or Portuguese—he was regarded with even more suspicion than other nongentlemen. His moneylending activities stigmatized him, even when the interest he charged was not excessive. During the Conquest, when settlers qualified for office and honors by their military prowess, merchants were excluded as noncombatants. Later, iln the 1520s and 1530s, merchants were more likely to be transients, lacking an interest in sinking roots in New Spain, concerned chiefly with making money and returning to the amenities of Seville. Of course, other migrants had precisely the same goal, but merchants typified this financial ambition. (Comment on this)
11:18 am	Spaniards Need The Spaniards, of course, at first needed Indian maize, fruits and vegetables to survive. In addition to designating city markets, the first viceroys imposed the requirement that Indians within a certain distance of the capital must bring maize and other foodstuffs to sell. Even after the settlers grew their own wheat and other necessities, they sought Indian cacao and rich red and blue dyestuffs. The two trading economies thus existed side by side and intersected in the markets and also on the road. Although each side incorporated valued elements of the other's commerce, this was not an equal arrangement because the Spaniards held most of the political power. This is easily seen by the history of the pochteca, the elite longdistance merchants of the Aztec Empire. Scholars differ about how well they fared after the Conquest. Through the 1540s, at least, Indians claiming to be pochteca or their descendants continued a flourishing long-distance trade. They quickly grasped the great advantage of the mules and plied their wares over a large region. They were harassed, however, by the Spanish alcaldes mayores (local governors), who wanted to monopolize the products in their jurisdictions. Spanish competition and loss of Indian interest in the Aztec luxury wares that had been pochteca specialties compressed these professionals into a broad petty trader group. The 1560s seem to have been the turning point in the pochteca's change of status. The culmination of this process came when the local Spanish officials imposed the repartimiento de comerclo (forced sale of goods) on the Indian villages. They paid below market prices for Indian corn and cloaks and charged the Indians above market prices for the cloth, mules, and ribbons that they sold them in return. (Comment on this)
11:17 am	Indian Commercial Response to the Conquest The agents of the Seville trading houses who followed the conquistadors into the heart of the Aztec Empire encountered a commercially oriented polity whose towns and trade routes rivaled what they knew at home. The supreme market was Tlatelolco, adjoining Tenochtitlan, the Aztec capital, to the north. It dazzled the first settlers by its size, order, and display of marvelous and useful goods. But every altepetl (city-state) had its central market surrounded by a ring of village markets that alternated selling days among them. Aztec roads and footpaths traced out the routes along which were sent the ceramics, feathered costumes, obsidian-tipped knives, and algae snacks of Tenochtitlan southwards to the warmer regions along the Pacific, to the Valleys of Morelos and Oaxaca, or to the Gulf coasts. In return, the subordinate regions sent back cotton, cacao, unworked precious feathers, and jade either by means of private sales or, more likely, as tribute payment. One of the central questions in the historiography of New Spain is how the Indians responded to the efforts of the Spaniards to exploit them economically yet incorporate them as Christian subjects into a new colonial society. To what extent did Indians who were hardy enough to survive the disastrous epidemics of the 1520s and 1540s retain their own way of life, which, as we have seen, included a strong interest in artisan production and trade? As in other areas in the first half of the sixteenth century the Spaniards tried to establish two parallel trading systems. Indians could sell their eggs, wax, maize, and honey to the Spaniards for personal consumption, but the Spaniards were usually not allowed to resell these goods. The Crown excluded the Africans and the mixed-race groups that soon emerged from trading in Indian products. For their part, Indians were not supposed to use Spanish goods for trade, but, except for wine, they could buy Spanish cloth or household wares for their own use. Not surprisingly, the Spanish government could not maintain parallel trading systems. Both Indians and Spaniards actively trafficked in "each other's" products. In 1551, the goods for sale at the Indian market of Coyoacán included: rabbit hair and feathers for fancywear; clay vessels, obsidian blades and tumplines (forehead straps used by Indian porters); but also Spanish collars, shirts and candles. The Mixtecs and Zapotecs of Oaxaca wove silken thread and forged iron tools, and their nobility enjoyed wearing Spanish capes. All levels of central Mexican Indian society adopted Spanish money. (Comment on this)
11:17 am	Convoy System in Spain Unlike the guild, the convoy system was less a product of Spanish social structure than of the efforts of Barbary pirates and French rivals to seize the incoming treasure from New Spain. Enemy attacks required an effective defense. After French pirates seized the booty that Cortés sent back from Tenochtitlan, merchants took the initiative, financing a squadron to protect their vessels off the Spanish coast as early as 1521. Soon after, the Crown required merchantmen to sail in groups of 10, and separate warships were assigned to the convoys as escorts. The system only jelled in 1564-66, when a specific schedule for the ships was promulgated. The flota (fleet), leaving in April, was to sail to the Caribbean with Veracruz as its main destination. It was protected by two warships. The galeones (galleons) were to sail in August for the Isthmus of Panama, reaching Portobelo with a few vessels going to Cartagena. The traders transshipped goods across Panama and along the Pacific coast as far as Arica, south of Lima. The galeones convoy included eight warships, since, until the 1670s, Peru sent more silver back to Spain than did New Spain. The two convoys, called the Armada de la guardia de las Indias, spent the winter in America and joined each other the following March at Havana to return to Spain before hurricanes threatened their passage. There was always an illegal effort to cram merchandise onto the warships, reflecting the passion for trade that so many of New Spain's inhabitants shared. But despite overloading and problems of refitting and obtaining experienced crews, the convoy system did a splendid job of protecting the cargoes. Spain's enemies only captured the Indies treasure twice ( 1628, 1656). In the Pacific, the Manila galleon itself was armed. Leaving the Philippines in June to avoid typhoons, it reached Acapulco, the only legal port of arrival, in January. It carried silks and brocades, linens and jewelry, porcelain and furniture from China, as well as exquisite luxury goods and spices from Japan, India, and Indonesia. These goods were reexported to Central America and Peru until 1631, when Spain prohibited this practice. The Armada de la mar del Sur, consisting of five galleons, protected the coastal Pacific trade. Few galleons were captured here, either. The system opted for security at the expense of flexibility. It made sense in the sixteenth century when the Seville merchants and the Crown filled the ships and kept the convoys to their prescribed annual schedule. In the seventeenth century they lacked the resources or the will to do either. (Comment on this)
11:17 am	From Experimentation to Conservatism In the 1520s and 1530s the nefarious consequences of Spain's policies were hardly glimpsed. Indeed, Carlos presided over a period of experimentation, as might be expected, given that the conquest of the Aztec Empire was an unprecedented event and that Carlos ruled a multiethnic European empire. One example of how policy was evolving was that although mercantilism usually excluded nonnationals from emigration and trade to the colonies, Carlos at first allowed all his Hapsburg subjects to come to New Spain. This permitted the Flemings, Germans, and Italians to enrich the transatlantic trade, alongside the renowned merchants of Burgos in northern Spain and the native Sevillians of Andalucia. Only under Philip II ( 1556-98) did the familiar restriction of emigration and trade to native Spaniards or those who had fulfilled onerous naturalization requirements appear. Because scholarship has focused on the late eighteenth century, this earlier international dimension is sometimes overlooked. Imperial commercial policy rested on three pillars: the Casa de Contratación, the consulados (merchant guilds) and the convoys (groups of armed escorts and merchant vessels). Although overseas trade was restricted to Seville from 1503, and the germ of monopoly took root early, it was several decades before these institutions emerged in their mature and rigid form. The Seville large-scale traders only founded their own guild in 1543, mainly to hear lawsuits more quickly than the other courts. But the consulado was also a kind of bank, which lent money to the Crown. The Spanish government depended on the consulado to outfit the ships. The merchants' financial role was crucial. Only men who shipped large amounts of cargo, the elite of the merchant community, could belong to the guild. Their 1556 Ordinances also excluded foreigners (who previously had been accepted), nor were Mexican-born merchants allowed. The consulado exemplified monopoly. Wealthy commercial houses of Seville and, later, Cádiz, came and went but it remained acceptable for a small group of traders to dominate trade. (Comment on this)
11:16 am	Mercantilism, Spanish Style Precious metals were valued above all other goods, and the Spanish Crown prohibited the reexport of American silver from Spain without a license. This policy was by no means unique to Spain. In fact, it grew out of the protectionism common to the city-states of medieval Europe. But Spain was the first to implement it on a massive scale and the first to demonstrate its weaknesses. Spain's inability to enforce its mercantilist policies in the seventeenth century mocked its goal of making the Empire strong and self-sufficient. However, even in a weakened condition, Spain's protectionism significantly influenced the direction of the colonial Mexican economy. It concentrated trade at a few choke points and heightened the existing dominance of Mexico City. Protectionism encouraged addiction to routine and an acceptance of fraud and xenophobia. The Casa's fiscal function typified Spanish mercantilism. The House of Trade collected the import-export tax and the royal fifth on silver. It was to make sure that the Crown received its share of the wealth of the Indies. But neither the Casa nor any other branch of government systematically promoted the Spanish manufacturing needed to meet New Spain's demand for finished goods. Spain could not reciprocate the bounty it received. As early as the 1560s, Spanish advisers criticized the Crown for concentrating on heavy taxes and neglecting the promotion of industry and agriculture. Part of the problem was beyond its control. The inflation that followed massive silver imports made Spanish-produced goods more expensive than their northern European counterparts. In any case, the Crown was disposed to pursue short-term fiscal goals at the expense of long-term developmental goals. (Comment on this)
11:16 am	First Contacts Merchants were the silent partners of the Spanish explorers. Conquistador Fernando (Hernán) Cortés' expedition to the coast of Mexico in 1519 is an excellent case in point. Merchants of Santiago de Cuba helped outfit his voyage and then awaited eagerly the pacification of the region so that they could sell their wheat flour, satins, leather, and wine and olive oil to the first settlers there. Because trade was one of the Spanish Crown's motives for backing voyages to America, it is not surprising that the first institution established to administer the Indies was the Casa de Contratación (House of Trade), founded in 1503 and abolished only in 1790. Located in Seville (until 1717 when it was moved to Cidiz), the only legal port of entry into Spain from America, the Casa regulated all aspects of trade. It inspected ships to make sure that they had the minimum tonnage required and were safe. It heard civil suits growing out of commercial disputes and some criminal suits as well, and it recommended commercial policies to the Crown. Complementing these functions, the Casa also licensed navigators and developed the first school of navigation in Europe. Since it also licensed passengers, the House of Trade was a precursor Immigration and Naturalization Service. Another function of the House of Trade was especially important because it symbolized the distinctive commercial system that Spain imposed on New Spain. (In this essay we will speak only of New Spain but, of course, these policies were applied to all of Spain's American Empire.) This system is often called mercantilism, as contrasted with the "free-trade" that slowly emerged in Europe, the United States, and Latin America in the early nineteenth century. Mercantilism meant the use of state power to channel the raw materials and precious metals of overseas realms (later called colonies, the term which we will, for convenience, use here) exclusively to the mother country. In exchange, New Spain was to buy all its imports, manufactured goods such as textiles and hardware, paper and glass, as well as basic foodstuffs, iron, and mercury, from Spain. Enslaved Africans were purchased from Portuguese suppliers under contract to the Spanish Crown. (Comment on this)
11:16 am	Two Perspectives on the Hapsburg Economy We should appreciate from the start that one dynasty, which governed the Spanish Empire from 1521 to 1700, presided over dramatically different cycles of commerce. "Hapsburg" refers to the Austrian royal house from which Carlos I of Spain ( 1516-56), who soon also became Charles V of the Holy Roman Empire, descended. Hapsburg American trade began with New Spain's first transcultural encounter in 1517, when Spanish explorers coming from Cuba bartered with the Maya in Yucatán. It continued from the 1530s to 1550, the first era of expansion, following the discovery of the first rich silver mines. It reached its apogee from 1592 to the 1630s. This was the century or so of Hapsburg commercial glory. But dynamism was followed by a reversal. From the 1640s to the 1660s there were three decades of contraction. While in the 1620s 1,363 ships filled the fleets, in the 1640s there were only 722. Yet, the end of the Hapsburg period did see a modest economic revival from the 1670s to 1700 and spasmodic efforts to remedy its political deficiencies. However, the imperial chronology of trade is not the only one we should employ. The bustle of Indian markets in town and countryside, and the journeys of hardy muleteers of all races along the camino real and the back roads, presented their own stages in the commercial history of sixteenth- and seventeenth-century New Spain. Scholars using Indian-language sources have found stages of development generated by native peoples. Interestingly, however, the turning points in both local and imperial development occurred at similar times. Many characteristics of the Indian communities of central Mexico were preserved during the years to 1550. For example, they owed labor duty to only one resident Spaniard and were governed in much of daily life by their local lords. From the 1550s to about 1640, however, Indian villages became more Hispanicized, with contacts with more Spanish employers and the adoption of Spanish town councils. The cultural synthesis was most extensive after 1640. In both cases the mid-sixteenth and mid-seventeenth centuries constituted moments of transition in the evolution of colonial society. (Comment on this)
11:16 am	Trade and Markets: Hapsburg New Spain The commerce of New Spain articulated several vibrant economies that spread the influence of the viceroyalty literally around the world. There was nothing like the complex system of trade and markets that characterized colonial Mexico in any other part of the Indies. The silver, dyes, sugar, hides and cacao that New Spain's traders shipped across the Atlantic contributed to the longevity of Spain's empire, the first European settlement empire in the modern era. Silverstuffed galleons sent to Manila fostered manufacturing and trade in East Asia. Foreign trade also brought prosperity to a small minority of New Spain's residents, employment and social mobility to more. Yet, exports were only the bestknown facet of Hapsburg New Spain's commerce. A diverse domestic trade also testified to the viceroyalty's wealth. This domestic trade included silver, of course, but cattle, mules and sheep, tallow, and hides flowed from the north also. They were exchanged for sugar, cotton, tobacco, as well as wheat and flour, cacao and honey, pottery and furniture, cotton and woolen fabrics from the center and south. Puebla's ceramics and Nuevo León's wool met in the markets of the capital. Mexico City joined a north-south highway, the camino real de la tierra adentro, with an east-west highway, the camino de los arrieros, which ran from Veracruz through Mexico City and then southwest to Acapulco. The southern leg of the camino real had already reached Guatemala City in the 1550s. As more mines were discovered, the northern leg was continually extended. It eventually reached Santa Fe and Nuevo Laredo. The capital was the linchpin, "the belly of this kingdom," the largest market in the northern hemisphere. On a smaller scale, however, and assisted by credit from Mexico City, Zacatecas, Guadalajara, Oaxaca, and Puebla were the "capitals" of their own regional trading circuits. (Comment on this)