Foreign Borrowing in 16th Century Spain
This paper examines the lending by Genoese-led cartel to Phillip II of Spain in the 16th century from the viewpoint of sovereign debt. The Genoese linked specie deliveries from Spain to the Low Countries to lending in order to cartel created a penalty to enforce their loans. If the king tried to renege, the Genoese applied the penalty and the king eventually repaid.
I. Introduction
Sovereign lending, throughout history, has been marked by occurrences of partial default and repudiation by governments of all kind; from medieval princes to dictators to democratic regimes. In the 1970s lending to lesser-developed countries led to the rescheduling and partial defaults in the 1980s. Even the sustainability of the debt of nations such as Belgium, Canada, Italy and even the United States is not free from suspect.
The reign of Philip II of Spain provides a good example to extend our knowledge of sovereign lending. Philip II fought wars through out his reign. To finance fluctuations in military expenditures, he had to borrow extensively. Repeatedly, Philip II’s Genoese lenders had imposed debt ceilings on the Crown. Once after reaching the debt ceiling, the Genoese suspended lending. They further punished Spain by executing a penalty in order to force payment of loans; an embargo on specie delivered to Spain’s armies. The military consequence of the embargo was severe. “Spain was the predominant military power of the age, and Philip II was the last sovereign to credibly threaten to dominate Europe until Napoleon.(Kennedy p30)”. This played a significant role in testing Philip II’s aspirations in Europe and eventually caused Philip II to cede to the lenders.
Sovereign debt theories first must assume the premise that there is no third party enforcers and that lenders must be able to enforce claims on their own. In addition these theories use reputation arising through repeated interaction to generate equilibria. It is only then that lending agreements are made and self-enforcing. Bulow and Rogoff (1989b) show that no lending will occur if the only threat is to cut off future lending. This is because merely the threat to withdraw credit is not a severe enough penalty to prevent the Crown from repudiating his debt. Lenders would then anticipate this, and consequently, they do not lend.
There are two classes of models that elaborate on Bulow and Rogoff’s result and provide environments where repudiation does sustain positive debt.
This paper is structured as follows. In order to better understand the Great Recession, the first section includes an examination on some of the key causes. Section two outlines some of the fiscal policy responses made by the government to the Great Recession. In the third section, relevant extant literature relative to studies on the fiscal policy implemented in response to the Great Recession will be discussed with a focus on potential problems. For problems noted, recommendations for resolution will be included. The objective of this paper is to consider relevant problems that might require further consideration in a research project about the long-term after effects of fiscal policy implemented by the U.S. government in response to the Great Recession.
Descartes was born in LaHayer, France on March 31, 1596. Trained in Aristotelian school, he attended boarding school in a Jesuits-based boarding college at the age of 8 years old, going on to law school at the age of twenty two. His father placed increased focus on the importance of education, as he was a member of the provincial parliament of France. Descartes’ mother died while he was young and so he was raised by his grandmother and then sent to boarding school. Descartes schooling focused on theology and philosophy as well as science and mathematics, including the study of the metaphysical and geometry. He was first considered a mathematician and then philosopher by many, with his addition of his wo...
“The National Debt (sidebar).” Issues and Controversies. Facts on File News Services, 23 Jan. 2009. Web. 25 May 2011. .
It also doesn’t just paint a positive picture of traditional views as well. Although the theme was about the benefits of the national debt, the author also raised concern about the way the national debt is being used today as he states that the debt is, “an escape valve for political pressure.” This way successfully combines the necessities of the national debt, and the fears of its abuse make this work enlightening to the reader to gain knowledge on the
To deal with France’s economic impending doom Louis XVI called all of the nobles and those with significant wealth together and requested to borrow money from them. Because there was no legal way for the l...
According to Gretchen M. Wilhelm and Michael W. Firmin, in their article Historical and Contemporary Developments, the Department of Education found that over 1,700,000 students are homeschooled. That’s 3.4 percent of all school age children (304). Homeschooling is defined as an education that contains less than twenty five hours of public school teaching each week and is based out of a household. The earliest forms of education were originally taught from home, then later developed into public schools (Wilhelm and Firmin). Homeschooling not only affects the students taught, but also fellow Americans in the race to advance a nation. Homeschooling needs to be understood in order to revise education into a better and
Whealey, Robert. "How Franco Financed His War - Reconsidered." Journal of Contemporary History. Sage Publications. 133-52. JSTOR. Web. 5 May 2014.
Diffie, Bailey W. Foundations of the Portuguese empire, 1415-1580. Minneapolis: University of Minnesota, 1977. Print.
The Conquest of New Spain Cortés came not to the New World to conquer by force, but by manipulation. Bernal Daz del Castillo, in the "Conquest of New Spain," describes how Cortés and his soldiers manipulated the Aztec people and their king Montezuma from the time they traveled from Iztapalaopa to the time when Montezuma took Cortés to the top of the great Cue and showed him the whole of Mexico and its countryside, and the three causeways which led into Mexico. Castillo's purpose for recording the mission was to keep an account of the wealth of Montezuma and Mexico, the traditions, and the economic potential that could benefit Cortés' upcoming conquest. However, through these recordings, we are able to see and understand Cortés' strategy in making Mexico "New Spain." He came as a wolf in sheep's clothing and manipulated Montezuma through his apparent innocence.
In my family, we see religion as our own personal decision; different to each individual. All the children in the Meyer family have been encouraged to explore religions and find what fit us best. As a child I was looking for a religion that I could relate to. I wanted to get in touch with nature and myself. I explored many different religions but I found no connection to them. My grandmother, a few cousins, and an aunt practice Wicca, and when I was nine I took immediate interest. I quickly felt like I belonged somewhere and had a purpose. My nana took me under her wing and I studied and practiced under her supervision. My nana is a High Priestess, an equivalent to a Pastor or Priest, and was therefore qualified to instruct me in Wicca. Over the course of my adolescence I have learned a great deal about Wicca, and I devoutly practice Wicca each and every day. There are multitudes of non-believers and some extremists that aim to harm Wiccans, but Wicca is not violent, or evil. Wicca is a beautiful, enthralling religion that is self- and nature-based and focuses on the journey of life through knowledge, wisdom, and exploration.
Homeschooling offers students a more time efficient education that allows the student to focus on education in which is the sole purpose for school. Homeschooling also gives the teacher a thorough evaluation of a student’s strengths and weaknesses by visually seeing what subjects they excel in and what subjects they are weak in. At this point students can increase their individual progression in each subject. Homeschooling permits control of the environment a student learns in to retain the focus of the student. This will reduce the chances of drug usage, bullying, and violence. Samuel Blumenfeld said this on the importance of homeschooling “The home is a safe haven for the children in a world awash with drugs, sexually transmitted diseases, violence, and moral corruption” (Cindy Mur et al.76). When parents come to realize that the home is the safest place for their children, then will they act as Blumenfeld concludes “I look forward to the day when the public schools will be virtually empty not because we have abolished public education but because the parents will have abandoned it” (Cindy Mur et al.
While growing in a Bourgeois family in La Haya, France, Descartes became educated in liberal arts and many of the metaphysical beliefs of classical philosophers. Descartes first true contribution came in collaboration with Isaac Beeckman who partook in what became known as mathematical physics. It was in these discussions of atoms and various other molecules that Descartes had conveyed various concepts of analytical geometry in which he believed would become an alternative to compass and ruler mathematics, yet as mathematics had become significantly more intricate this system became better known as Cartesian Coordinates in honor of Descartes.
Historically, financial crises have been followed by a wave of governments defaulting on their debt obligations. The global economic history has experienced sovereign debt crisis such as in Latin America during the 80s, in Russia at the end of the 90s and in Argentina in the beginning of the 00s. The European debt crisis is the most significant of its kind that the economic world was seen started from 2010. Financial crises tend to lead to, or exacerbate, sharp economic downturns, low government revenues, widening government deficits, and high levels of debt, pushing many governments into default. Greece is currently facing such a sovereign debt crisis and Europe’s most indebted country despite its surplus in the early 2000s. Greece accumulated high levels of debt during the decade before the crisis, when the capital markets were highly liquid. As the crisis has unfolded, and capital markets have become more illiquid, Greece may no longer be able to roll over its maturing debt obligations. Investment by both the private and the public sectors has ground to a halt. Public sector debt has increased substantially as the state had to rely on official assistance to payroll expenses, fiscal deficit and fund social payments.
Education is one of the most important platforms needed for people to achieve their long term goals involving a career. Without education, people would not receive the right knowledge they need in order for them to get a job they are passionate about. Students working toward these goals are presented with many options of education including public school, private school, and homeschooling in order to learn the information they need. When parents choose homeschooling for their child, they are taking risks in many aspects because homeschooling is a much different environment and learning experience than attending a real school. As of right now, anyone in the United States is allowed to homeschool their child, but should the government allow that? Not all homeschooled children are receiving the same quality of education that public and private schools offer. Although the proposal to completely outlaw homeschooling is out of the question, Laws or rules should be in place as to who or under what conditions a person may be homeschooled. Homeschooling can limit a child’s productivity, opportunities, and decreases the chances to learn social skills, proving that unless there are extenuating circumstances, children should attend regular school on a daily basis rather than be homeschooled.
Many parents have criticized homeschooling, claiming that homeschooling provides a negative effect on the students’ social life, and trains them to be more secluded from the rest of the “outside world”. However, in an analysis posted by Widener Law Review titled “Homeschooling: Constitutional Analysis in Light of Social Science Research:”, research has shown that “homeschooled students score as well as or better than traditionally schooled children on widely used measures of social development.” In the article, the authors go into development as to just how much the homeschooled students excel vs. the students of traditional schools. In terms of the job life, “Homeschooled adults are also well prepared to participate in the economic realm. They have entrepreneurial skills and make desirable employees”. What this means is that although many critics attack the ideals of homeschooling, there is solid foundation for parents to stand on when deciding their best course of