Editing Price revolution (section)

====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>