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To: Hawkmoon who wrote (76428)	7/16/2011 9:24:19 PM
From: skinowski	3 Recommendations Read Replies (2) \| Respond to of 218131

like the history of Spain, having accumulated massive wealth through conquest doesn't make for a sound economic foundation. Some years ago I read book on history of economics. The way the author saw it, having found large amounts of gold in the new colonies proved to be a terrible thing for Spain. The kings, the courtiers, everyone who invested any money into the conquest of the colonies - all became incredibly rich. Gold was being brought in by the shipload. The problem was that while other European nations kept learning, advancing manufacturing, developing new technologies - the Spanish did nothing of the sort. There was not enough motivation. They had Gold. Anything they needed or wanted, they could afford to buy. The wealth effect "trickled down" - and it took centuries until Spain caught up with other nations. They run out of gold, and were left with an inferior economy. Similar arguments are offered with regard to oil rich nations. In some way, this is part of our current conundrum. The Dollar being a reserve currency has a somewhat similar effect. We do not have trillions of dollars worth of gold, but we can export dollars. This will not last forever (Tim's and Ben's assurances notwithstanding), but so far other nations are still taking our paper. The earlier generations of Americans have left a deep impression, and we still enjoy credit. We would be wise to do our part and not destroy it.