Capitalist Traders Then And Now

There are those occupying Wall Street and railing against capitalism but at the same time almost all of them worship Zuckerberg and Jobs as celebrities. Needless to say they also don’t say anything negative about rap “singers” earning millions a year. They seem to be very selective about which rich folks they dislike. They don’t like people who buy and sell things that is for sure. But there have been Zuckerberg’s and Jobs for most of recorded history and we and our ancestors have been the beneficiary of their vision and risks they took.

If we turn back the clock to the very early 16th century we find two cousins in Portugal, one named Serrao and the other Magalhaes. They were what we would call upper middle class but far from wealthy. The age of exploration was in full flower; this was only a few years after the third voyage of discovery of Columbus. They wanted adventure, riches and to push the envelope. They both shipped out to the then brand new trading area for Portugal in India which was in its infancy. They went and fought in numerous battles there and Magalhaes was wounded and sent back home but after healing he was bored and shipped out again for India and parts east. This next campaign with his cousin Serrao in tow went all the way to Malacca on the western coast of modern Malaysia. It was then the major entrepot, or trading and transition port for the eastern silks, porcelain and spices from the East–China and the Spice Islands. There the locals planned an surprise attack on the five Portuguese ships. Magalhaes captain grew suspicious and sent him to warn the command ship and turns out he did in just the nick of time. He and the others repelled the borders and drove off the other attackers. Some of the Portuguese were onshore at the time. All were killed except one–Serrao. It was his cousin who rescued him from the beach at the last moment in a row boat. The fleet retreated but not forever.

Magalhaes was promoted and the fleet returned in 1510 and seized Malacca and all its riches. But cousins did very well financially because of their share of the nutmeg, mace, cinnamon and cloves taken as part of the booty. Magalhaes decided to return home and enjoy life; Serrao wanted one more try for even more adventure and riches. Serrao joined the expidition to the Spice Islands about 1800 miles farther east. The Spice Islands are south of the Philippines, just west of New Guinea. The trip was initially successful and the three ships were loaded to the gills. Indeed the commander had so overloaded Serrao ship that it foundered on a nearby reef. Serrao was able to save much of the crew and they returned to the islands were he went “native” and became an advisor to the local king of Ternate, one of the Spice Islands and had the good life but remote.

Meanwhile back home Magalhaes grew bored quickly and by 1512 went to war again this time in Morocco where he was again badly wounded and returned home with a limp for life. He was also accused of pilfering the army/navy supplies for his own benefit but was tried and cleared of those charges. Amazingly, during the time period and the time after his return from Morocco he received letters from his cousin given all sorts of details about the Spice Islands and local navigation details and crop availability. They were erratic but constant over the years. It would take a year for some letters to arrive from a return voyage of a Portuguese ship. Magalhaes also studied everything he could find in the local library about navigation and studied navigation under one of the era’s masters of that art. He was an “expert” on the Spice Islands even though he had not been there.

Because the Pope had adjusted the demarcation line, moving it 800 miles farther west Magalhaes now concluded (wrongfully) that the Spice Islands were in the Spanish portion of the division. He had appealed to the Portuguese King to allow him to lead a mission going west to reach them rather than around the Cape of Good Hope at Africa’s southern tip which had been the Portuguese route for a couple of decades. After rejection in Portugal he took his pitch to the Spanish court and his proposal was accepted. He started his adventure in 1519 with five ships and was going to round what would become Cape Horn. Like Columbus he had miscalculated the circumference of the earth and the voyage was far longer than he imagined.

His expedition did round the Horn and made into the Pacific and explored many islands as they kept trying to make their way to the Spice Islands the riches they could reap there. Magalhaes encountered many obstacles and dangerous situations and finally met his fate in the Philippines by the spear of native there on the beach. Curiously, his cousin also died within weeks of him and “only” a few hundred miles away. He was poisoned by the King of Ternate who had become jealous of his power and suspected his ambitions. Of the five ships that left Spain only two managed to drop anchor in the Spice Islands and they loaded their holds with cloves, indeed they again overloaded. Only the Victoria finally made it back to Portugal. Of the 265 men that began the adventure only 31 were aboard the Victoria upon its return. In spite of the enormous expense in those days to outfit such and expedition, the cloves in the hold of the Victoria brought enough profits to pay for the entire mission and the loss of the other ships.

The man killed on the beach in the Philippines is best known in American history books as Magellan. He changed his name to a Spanish Magallanes and in turn the English version of Magellan. Our history books give him a couple of sentences and say he was the first to go around the earth. Well, the expedition did, he didn’t make it and it was for trade that he made the adventure. He was on the cutting edge of commercial development of his day, an entrepreneur and innovator. The real story of historical figures is often far more interesting than the “fifteen minutes of fame” blurbs that become the accepted totality of the life.

Hey, the avowed socialist finance minister of France under Hollande is on to something. He is quoted this week as saying that a government that keeps adding debt is just making the country poorer. Hmm, wish our own closed socialist in the White House could get his head around that concept. The BO budget calls for another 9 trillion increase in our debt over the next decade, in addition to the 16 trillion we already have.

1 Comment

Filed under business, Economics, geography, history, Politics

One response to “Capitalist Traders Then And Now

  1. Great post today Dad! I really enjoyed the history lesson, the adventure, and the story.


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