Editing Price revolution (section)

=== Spain ===
====External debt====
Rising costs to sustain Habsburg war efforts eventually led to a severe rise of the Spanish [[public debt]], of which German and Italian bankers were the creditors. The Habsburg [[Charles V, Holy Roman Emperor]] was also [[King of Spain]] and borrowed enormous amounts of money from the [[Fugger]]s, the [[Welser]]s, and Genoese banking families, in order to be elected Emperor and sustain, for over 35 years, the Imperial foreign policy. To repay such loans, he relied primarily on the vast stream of bullion provided by Spanish America. In the 1520s and 1530s, ships full of [[Aztec]] and [[Inca]] treasures arrived from [[Mexico]] and [[Peru]] to the courts of Charles V as homage of [[Hernán Cortés]] and [[Francisco Pizarro]]. Those treasures were usually minted into coins in [[Seville]] and transferred to German bankers in [[Antwerp]], a [[port city]] of the [[Burgundian Low Countries]] where major agencies of the Fugger and Welser were located. This allowed Antwerp to become the center of the international economy and accelerated the [[capitalist]] transition of the Low Countries. Certain golden objects have survived in descriptions: for example, some were displayed in Brussels to the German artist [[Albrecht Dürer]] who wrote: "In all my life, I have seen nothing that rejoiced my heart so much as these things". French corsaires were constantly disrupting this trade: notably, the treasure of the Aztec emperor [[Cuauhtémoc]] was captured by the French corsair [[Jean Fleury]].

Silver arrived in large amounts, whereas gold was rarer to be found. In 1528, Charles V carved out a colony in [[Venezuela]] for his German bankers, hoping to discover the legendary golden city of [[El Dorado]]. In 1546, the project came to an end and the German colony was disbanded. In the 1540s and 1550s, the discovery of silver mines in the Americas (such as [[Potosí]], [[Zacatecas City|Zacatecas]], [[Taxco]], [[Guanajuato City|Guanajuato]], [[Sombrerete]]) increased the flows of precious metals. Overall, 15 million ducats' worth of bullion reached the Imperial treasury during Charles's reign. This contributed to the higher inflation known as the Spanish price revolution: prices doubled in the first half of the 16th century. The rising costs of war had dramatic consequences on Habsburg finances: one campaign in the 1550s costed as much as one war in the 1520s. Charles V was forced to borrow even more and at higher interest rates, which grew from 17% to 48%.

Despite opposition from the {{lang|es|[[Cortes Generales]]}}, Charles V managed to impose this [[vicious circle]] that progressively weakened the Spanish finances. Furthermore, in the last years of his reign, Charles V could not be economically supported by his non-Spanish possessions: he exempted the Low Countries from taxation after the [[Revolt of Ghent (1539)|Revolt of Ghent]] in 1540, Germany was in the middle of the [[Schmalkaldic War]]s, and the budget surplus of Italian states was wiped out by the [[Italian Wars]]. This ultimately put the financial burden of the [[Holy Roman Empire]] on the Spanish kingdoms and led to the bankruptcy of Spain. Unable to sustain his projects financially, Charles V abdicated in 1556 and retired to a monastery in 1558. [[Sovereign default]] was declared in 1557.<ref>{{Cite web|url=https://books.google.com/books?id=Gqp-DwAAQBAJ&dq=Charles+V+cortes+generales+precious+metals&pg=PT111|title=Themes in International Economics|first=Mats|last=Lundahl|date=December 7, 2018|publisher=Routledge|via=Google Books}}</ref>
<ref>{{Cite web|url=https://books.google.com/books?id=t8NfAAAAMAAJ|title=Spanish Opposition to Charles V's Foreign Policy|first=Sean T.|last=Perrone|date=April 6, 1992|publisher=University of Wisconsin--Madison|via=Google Books}}</ref><ref>[https://www.geology.ucdavis.edu/~cowen/~GEL115/115CH8.html Gold and Silver: Spain and the New World] {{Webarchive|url=https://web.archive.org/web/20081007054754/http://www.geology.ucdavis.edu/~cowen/~GEL115/115CH8.html |date=2008-10-07 }} University of California</ref>

==== Landowners ====
Conditions in 16th century Europe support the view that the separation of constantly rising prices and fixed rents destroyed landowners. But this did not apply to Spain, where rent was not fixed and the power of landowners allowed them to raise rent and replace their tenants based on the tenants' ability to meet payments.<ref name=Lynch>{{cite web |last=Lynch |first=John |title=Spain During the Price Revolution |url=http://www.p12.nysed.gov/ciai/socst/ghgonline/units/4/documents/Lynch1.pdf |access-date=2017-08-17 |archive-url=https://web.archive.org/web/20170208001528/http://www.p12.nysed.gov/ciai/socst/ghgonline/units/4/documents/Lynch1.pdf |archive-date=2017-02-08 |url-status=dead }}</ref>

On the other hand, the price revolution brought impoverishment to those who lived on fixed income and small rents, as their earning could not keep pace with Spanish prices. Small landowners of the {{lang|es|[[hidalgo (nobility)|hidalgo]]}} class, the lower clergy, government officials, and many others all found their standard of living reduced as commodity prices rose beyond their means. The situation of the peasants is less clear, for it is difficult to reconcile agricultural prosperity and the great rural emigration to the towns, which in turn makes it difficult to explain the alleged extension of cultivation in Spain. But one thing is certain—wages lagged behind prices.

==== Sellers and traders ====
But landowners and the rich were not the only ones gaining from the price revolution. Anyone with something to sell or trade could reap the benefits of inflation, particularly manufacturers and merchants. However in the second half of the century, when the conditions of the Price Revolution got worse and relentless inflation began to make Spanish enterprise less competitive in the international and colonial market, not all merchants and manufactures found life enjoyable. Only the more powerful merchants were able to survive foreign competition and in doing so prospered boundlessly. Enormous fortunes were made in the Indies trade (whose expansion was related directly to the rise of prices) and this encouraged more investment and profitable returns. Profitable returns were distributed beyond the merchant houses of Seville to entrepreneurs in other parts of Spain, as the American market took the oil and wine of [[Andalusia]], the wool of [[Crown of Castile|Castile]], the metallurgical products and ships of the [[Basque Country (autonomous community)|Basque country]].<ref name=Lynch/> To at least the end of the 16th century there was still money to be made in Spain for selected merchants and manufactures.

==== The Crown ====
The Crown, like its ally the aristocracy, was less crippled by the price revolution than the majority of its subjects. Certainly the cost of administration, and of paying, feeding, and equipping its armed forces, rose for the Crown just as the cost of goods did for the private consumer; unlike other countries, Spain was willing to spend at a higher level to maintain their status as a world power.<ref name=Lynch/> However, the aristocracy in contrast lost less of its savings than the Crown. The aristocracy could raise rents to increase revenue and not face the full consequences of the Price Revolution. The aristocracy allowed prices to remain high, while inflation alleviated the burden of loans, which became a substantial part of their income.<ref name=Lynch/>