GregIncreasing wealth around the world drives demand for particular products, and early speculators in those key goods can get rich. Western European wealth and population grew in the 1500s. Total population was up 50% over 100 years at the same time as average wealth rose 15%. Not impressive at all by today's standards, but major progress compared to earlier centuries. Demand for spices to flavor food and hide the odor in meat (and kill microbes), grew dramatically. Plus nutmeg was believed to help cure the plague and other grave diseases.

The book "Nathaniel's Nutmeg: The True and Incredible Adventures of the Spice Trader Who Changed the Course of History," tells the story of European merchants establishing direct trade with the Spice Islands–trade that had for centuries gone through India and the Middle East. English merchants in 1602 present a letter from Queen Elizabeth to Ala-uddin Shah, the powerful Sultan of Achin in Sumatra. After two pages of praise for Ala-uddin and attacks on Portuguese and Spanish pretensions, the Queen requests opportunities for commerce, writing: "Trade not only breeds intercourse and exchange of merchandise .. but also engenders love and friendship betwixt all men." (p. 88)

Trade may engender love and friendship, but competition among state trading monopolies tends to spill much blood first, sending sailors, soldiers, and merchants alike to their graves. The Dutch, with their superior capital markets, raised more money and sent fleets faster and larger to roust out the Portuguese and set up trade networks.

Nutmeg and other spices were valued pound for pound far more than gold in Europe, and nutmeg was the prize of the early spice trade, growing at first only on tiny Run island. After long battles between the British and Dutch, the Dutch gain control of Run island by treaty, in exchange for British control of New Amsterdam.

I am rereading too "Nutmeg of Consolation" and reflecting on the Aubrey's ruse to draw a French ship close in for battle. Edmund Scott, the British East India company's factor on the spice island of Bantam, had somewhat the opposite problem: "Scott soon realized that one of the main reasons why they faced the constant threat of violence was that the native Javanese were unable to distinguish between the English and Dutch. The Hollanders, who lived in Bantam in considerable numbers, paid scant regard to the sensitivities of the local population and thought nothing of staggering home through the streets of this staunchly Muslim town after a lengthy drinking bout. … The situation was made worse by the fact that some of the Dutch would pretend they were English if they thought it would be to their advantage when buying spices."

The English came up with the idea of staging an elaborate celebration for the anniversary of Queen Elizabeth I's coronation, dressing themselves up in white silk and scarves of red and white, to "make 'a flagge with the redde crosse thorow the middle." The fourteen English traders marched up and down the town streets attracting hundreds of curious Javanese. The locals asked why the other "English" were not celebrating, and were told they were Hollanders and had no King. "The day ended in triumph. As a constant stream of shot was fired in celebration from the English factory a procession of children wound through the street shouting "Oran Enggrees bayck, orak Hollanda jahad," which is "the Englishmen are good, the Hollanders are naught."

We hear today of securities markets seized up because investors can't tell reliable securities from dodgy ones. Maybe it is time for a major advertising campaign by British firms who can claim they answer to a higher authority, and another Queen Elizabeth.


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