EDWARD'S LECTURE NOTES:
More notes at http://tanguay.info/learntracker
C O U R S E
A History of the World since 1300
Jeremy Adelman, Princeton University
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C O U R S E L E C T U R E 17th Century Interdependence of Trade and Investment Notes taken on December 10, 2013 by Edward Tanguay |
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increasing distinction between
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1. merchantilist regimes
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government relies on social classes to generate pools of wealth and capital that will sustain it (merchants provide revenue to state and buys state bonds which enable the state to build up its military, which protects merchants' monopolies)
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2. agrarian regimes
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Mughal India
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China
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to some extent the Hapsburg Dynasties
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rely on feudal structures to deliver revenue through tax collectors from villages to be sent to the center of power
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the 18th and 19th century, these two kinds of systems clashed
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organizations of market places
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markets don't just pop up spontaneously
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you don't get your cup of coffee because someone in Kenya felt like harvesting and drying out beans one day
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1611 Amsterdam Stock Exchange - first stock exchange
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one way to recirculate the pool of capital that has been created in the relationship between the state of capitalist merchants was to create the stock market
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stock market starts in Amsterdam and in London
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in a stock market, the companies themselves are bought and sold in the market place
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with the purchase of these shares, more capital flows into the market place
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created a cycle of creating capital
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insurance companies insured long-distance trade, against storms, pirates, and other dangers
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the stock market was a place where societies' savings could be make disposable for investment to reconcile the supply and demand of capital
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some people began to make money simply off the trading of these shares
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an important injection into this system were the large amount of precious metals that came from the Americas
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gold mines in Brazil
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in all of the three centuries that would follow from 1500 onward, half of the silver and gold flowed out in the 18th century alone
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attracted swindlers and speculators
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South Sea Bubble
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the effect of a series of speculations that occurred as the result of the South Sea companies carrying goods from Africa to South America
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the merchants kept buying more and more shares in the government that was promising them more monopoly rights
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by 1719, 25% of British national debt was owed by one company called the South Sea company
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the bubble burst and created a fiscal crisis for the state