Growth of Trade and Banking

Introduction Gains in agriculture produced bigger changes in medieval economic life Banking was soon introduced to help facilitate this new long distance trade The largest banking operations were in Italy However, Germany, the low countries, France, and Britain were clearly capitalistic

Exchanges Between western Europe and other parts of the world Wealthy Europeans developed a taste for luxury goods Mediterranean trade developed once again – mainly in the control of Italian merchants Timber and grain came from northern Europe and cloth and metal came from the south

Soon, commercial alliances emerged First in Germany – The Hanseatic League –This was a mix of people in Germany and southern Scandinavia

Banks Many Jewish people dominated the banking sector of the economy They lended money to the monarchs and the papacy This growth of banking and trade served Europe as the origin of capitalism

Capitalism Investing for profit Individual merchants could gain mass amounts of profit Jacques Coeur - one of Europe’s most famous entrepreneurs He founded a trading company that competed with Italians and Spaniards He visited Damascus for spices, rugs, silk, and Indonesian spices He also became a financial advisor to the King of France

However, when it was discovered that he was selling weapons to Muslims, he was tortured and sent to die on a Greek island

Other Leagues and Groups Many of the growing commercial cities were run by leagues Royal governors did not interfere with commercial business Thus, this rising merchant class was gaining power in Europe Guilds formed – grouped people in similar businesses, they stressed security and mutual control; all members gained a share of profits

Artisan guilds were made up of people who actually made cloth, bread, jewelry or furniture Guilds guaranteed quality They often had a voice in city government