e finally as the result of the bankruptcy {522} of the
Spanish and French governments. [Sidenote: Bankruptcy of France and
Spain, 1557] Spain's repudiation of her debt was partial, taking the
form of consolidation and conversion; France, however, simply stopped
all payments of interest and amortization. Many banks throughout
Europe failed, and drew down with them their creditors. The years
1557-64 saw the first of these characteristically modern phenomena,
international financial crises. There were hard times everywhere.
Other states followed the example of the French and Spanish
governments, England constituting the fortunate exception. Recovery
followed at length, however, and speculation boomed; but a second
Spanish state bankruptcy [Sidenote: 1575] brought on another crisis,
and there was a third, following the defeat of the Armada. The failure
of many of the great private companies was followed by the institution
of state banks. The first to be erected was the Banco di Rialto in
Venice. [Sidenote: 1587]

The banks were the agencies for the spread of the capitalistic system
to other fields. The great firms either bought up, or obtained as
concessions from some government, the natural resources requisite for
the production of wealth. One of the very first things seized by them
were the mines. [Sidenote: Mining] Indeed, the profitable
exploitation of the German mines especially dates from their
acquisition by the Fuggers and other bankers late in the fifteenth
century. Partly by the development of new methods of refining ore, but
chiefly by driving large numbers of laborers to their maximum effort,
the new mine-owners increased the production of metal almost at a
bound, and thereby poured untold wealth into their own coffers. The
total value of metals produced in Germany in 1525 amounted to
$4,800,000 per annum, and employed over 100,000 men. Until 1545 the
German production of silver was greater than the American, and copper
was almost as valuable {523} a product. Notwithstanding its increased
production, its value doubled between 1527 and 1557. The shares in
these great companies were, like the "Fugger letters," or certificates
of interest-bearing deposits in banks, assignable and were actively
traded in on various bourses. Each share was a certificate of
partnership which then carried with it unlimited liability for the
debts of the company. One of the favorite speculative issues was found
in t