Chapter 154: The Economic Crisis Has Arrived

What surprised Gao Da somewhat was that after the promulgation of such seemingly harsh laws, the impact caused in the Catalonia and Basque regions was actually not too significant.

However, it is easy to understand when one thinks about it; after all, the agitators in these two regions who once firmly demanded regional autonomy or even national independence had long since disappeared into the history of Spain along with the Carlists.

To say that there are no nationalists in these two regions would be impossible, but it is basically impossible for these people to dare to stand up and firmly oppose the laws promulgated by the government, or even incite protests and rebellions.

Although they support regional autonomy and national independence, it does not mean they are fools. They can still see the current situation in Spain clearly, and Prime Minister Primo is even waiting for them to jump out on their own so that he can round them all up.

Although there were no large-scale riots, some small-scale protests did occur.

However, these small-scale disturbances were completely painless for the Spanish government, and could even be resolved by simply deploying the security departments.

To ensure stability in the Catalonia and Basque regions, Prime Minister Primo specifically ordered the security departments to transfer a portion of police from other regions to Catalonia and the Basque country to maintain order, and incidentally to urge the governments of the two regions to implement the requirements of the newly promulgated bills as soon as possible.

For those who neither dared to stand up against the laws promulgated by the government nor were willing to accept them, Prime Minister Primo also gave them a new option, which was to emigrate abroad.

Prime Minister Primo detests those who engage in nationalism and regional autonomy ideologies. Because they will have a huge impact on the existing stability of Spain and will also make the Catalonia and Basque regions a permanent pain for Spain.

Precisely because he understands this point, Prime Minister Primo, as a Catalan, still firmly chose to fully unify the nation, religion, and language.

If the nationalist problems in the two regions of Spain could be solved in a more peaceful way, that would naturally be for the best.

For the people in the Catalonia and Basque regions who are unwilling to accept Spain's new policies, the Spanish government encourages them to emigrate to other places, and can even actively organize emigration teams to provide help to those who want to emigrate but do not have the travel expenses.

On this basis, if there are still radical nationalists in Spain who have different opinions on this law, then do not blame Prime Minister Primo for being cold-blooded and ruthless.

Encouraging them to emigrate is giving them a final chance; either choose to emigrate to escape Spanish law, or stay in Spain and obediently abide by the laws promulgated by Spain—there are no other choices for them to pick.

In fact, to put it bluntly, this law does not have much impact on most Spanish civilians. Whether they are Catalans or Basques, they all believe in Christianity, which is also the religion permitted by the Spanish authorities.

The only conflict is the large-scale popularization of the Spanish language and the concept of the Spanish nation, but these are not unacceptable to the common people.

Although this bill can effectively promote the national integration of Spain and more effectively solve the problem of national independence in Catalonia and the Basque country.

But doing so is not without its drawbacks. As long as one immigrates to Spain, one must naturally abide by the laws promulgated by Spain.

This is not so friendly to some immigrants; after all, it is not so easy to get them to quickly use the Spanish language and admit that they are Spanish.

To this end, Gao Da and Prime Minister Primo held multiple discussions and finally decided to hand over the task of spreading the Spanish language to Pedro, who had been promoted to Archbishop of Spain, letting him be responsible for the affairs of teaching Spanish to foreign immigrants.

In fact, such a task is not unfamiliar to the Spanish Church, because the previous Spanish Church held a large number of church schools in its hands, thereby controlling education in Spain.

However, the church's task is not just to spread the Spanish language, but also to spread religion.

In fact, for Gao Da and Prime Minister Primo, it does not matter whether one believes in Catholicism, Orthodoxy, or Protestantism.

As long as one believes in the religion under the Christian system and recognizes God, that is enough. The task of missionary work is clearly not aimed at immigrants from Europe, but more at the indigenous and mixed-race residents in the Spanish colonies.

Considering Spain's future strategic plans, when Gao Da met with Archbishop Pedro of Spain, he specifically requested that the Spanish Church prioritize missionary work among the Moroccans in the South Morocco colony, and indicated that the progress of missionary work could be accelerated through certain tough measures.

Do not look at how Europe generally believes in Christianity now; in fact, hundreds of years ago, vast areas still believed in various religions derived locally.

The reason why Catholicism and Orthodoxy were able to spread throughout Europe was not by the gentle preaching of those missionaries, but by the relatively cruel high-pressure preaching of the Catholic Church and various national governments.

Among them, the most famous is the Inquisition during the Middle Ages, which laid an extremely important foundation for the widespread spread of Christianity in Europe.

The Inquisition of this period was not a court in the true sense, but possessed immense power and could unscrupulously impose various punishments on heretics (including but not limited to confiscation of all property, flogging, imprisonment, life imprisonment, etc.).

If the heretics still refused to repent, the Inquisition also had the power to sentence them to death, and in relatively cruel ways, the most important of which was burning at the stake.

Although it is impossible for the Spanish government to openly establish an institution like the Inquisition to clear out heretics in the colonies now, using similar methods is still possible.

Anyway, the rule of colonies by various countries during this period is not very glorious, and it will not have much impact on Spain to repackage it more civilly after there are certain results in the future.

Facts have proven that taking strong legal measures to unify Spain's nation, religion, and language is currently the better way.

Only two and a half months have passed since the bill was promulgated, and it has effectively rectified the phenomenon of linguistic chaos in the Catalonia and Basque regions.

As time came to May 1873, on the streets of Barcelona and Bilbao, only signs and text written in Spanish could be seen; the local language and script had already disappeared.

Regarding such changes, there were certainly some radical nationalists who expressed their dissatisfaction.

But these few people were clearly not worth mentioning in the face of Spain's national interests, and they were easily suppressed by the police.

Even the two infantry divisions that had prepared in advance were not needed; most people did not have radical opposition to this bill, and those who were more radical fell under the guns of the police under the strong suppression of the government.

Time froze on May 9, 1873, and the world crisis finally broke out.

Shifting the perspective to Vienna, the capital of the Austro-Hungarian Empire, this is one of the most prosperous cities in Europe and was once a world-famous international metropolis.

But since the arrival of May 9, the situation in Vienna has fallen into extreme chaos. The chaos first broke out at the Vienna Stock Exchange and then directly affected the entire city.

How terrifying is an economic crisis? In just 24 hours, the total value of all enterprises on the Vienna Stock Exchange depreciated by several hundred million guilders (Austro-Hungarian Rhine guilder, also known as the florin; 1 pound ≈ 11. Rhine guilders), causing many enterprises that were originally worth more than a million to return to their pre-liberation state overnight.

According to the current official exchange rate, the value of one million Rhine guilders is equivalent to 85, 70 pounds, or 2. 23 million pesetas.

No matter which country it is in, enterprises worth more than 80, 00 pounds are large enterprises. And in this rapidly arriving economic crisis, a large number of enterprises in Vienna worth more than or close to 80, 00 pounds are on the verge of bankruptcy, which is enough to prove how deadly the economic crisis is.

Slightly larger enterprises are fine; the situation is just on the verge of bankruptcy. Those small and medium-sized enterprises with lower values went bankrupt rapidly in the wake of the economic crisis.

The day before, these enterprises were still developing prosperously, and the next day they faced a very serious bankruptcy crisis, having to declare the bankruptcy of their factories and enterprises.

Such a vast difference in the situation after just one day also caused a large number of people in Vienna to fall into panic. The people scrambled to exchange their money from the banks, fearing that their money would also disappear along with the economic crisis.

But this serious bank run crisis instead exacerbated the pressure faced by the banks. What is even more deadly is that banks during this period were often not very regulated by the government, and were mostly small and medium-sized banks of a private nature.

Banks of this scale were simply unable to withstand a bank run crisis, so on the second day of the economic crisis, the residents of Vienna discovered a situation even worse than corporate bankruptcy: a large number of banks also began to declare bankruptcy.

Corporate bankruptcy means that a large number of Viennese lost their jobs, while bank bankruptcy means that the Viennese lost even their meager savings.

Very unfortunately, because of the suddenness of this economic crisis and the huge impact it caused, most Viennese suffered both.

In other words, more than half of the citizens of Vienna lost their jobs and their savings in two days, becoming penniless.

Although they still had houses, houses in this era were not worth much. Large cities were just slowly forming during this period, and the population of Vienna was only close to one million, so housing prices naturally did not reach a high level.

What is more, now that the economic crisis has arrived, even if housing prices were high, it would be impossible for anyone to use the money in their hands to buy a house.

This also led to a fatal problem for a large number of Viennese: they would have no source of income, and even the food, clothing, and daily necessities for normal life became a huge problem.

Although this economic crisis first started at the Vienna Stock Exchange, it was simply impossible for other European countries to be spared.

In less than a week, the economic crisis quickly swept through the stock exchanges of other countries led by London and Paris, and even the two small and medium-sized stock exchanges in Spain were affected to a certain extent.

"Gao Da, is this the impact of the economic crisis?" Queen Sofia of Spain sat on a stool, feeling somewhat uncomfortable, holding in her hand the latest newspaper published by a local newspaper in Vienna.

Although she married far away to Spain, Queen Sofia was still very concerned about the Austro-Hungarian Empire. In order to let his queen know about the big and small events happening in the Austro-Hungarian Empire every day, Gao Da even had people collect various news and newspapers from the Austro-Hungarian Empire every day and transport them to Spain at the fastest speed.

For Gao Da, whose assets had long exceeded one hundred million, this small expense was simply a drop in the bucket, not as important as making his Queen Sofia smile.

It is precisely because Sofia has been paying attention to the major events in the Austro-Hungarian Empire almost every day that the economic crisis that broke out in Vienna not long ago naturally could not be hidden from her ears.

"This is the law of capital development; it is unavoidable, Sofia." Gao Da could only nod and explained to Sofia: "However, judging from the economic scale of the Austro-Hungarian Empire, although this economic crisis is serious, the impact caused will not be too bad.

If the government can react in time, the impact on the Austrians should be able to be limited to an acceptable range."

"Spain shouldn't be affected, right? Do we need to prepare in advance?" Hearing that the economic crisis would not have a too serious impact on the Austro-Hungarian Empire, Queen Sofia breathed a sigh of relief, and then began to care about Spain's response to this economic crisis.

"Rest assured, the impact of this economic crisis on Spain is minimal. Spain's economic and industrial scale is not large, and it will not cause an economic crisis itself.

Even if it is affected by the economic crisis, it is within an acceptable range, so there is no need to worry at all." Gao Da said with a smile.

Originally, the impact of the economic crisis on Spain was not large, not to mention that the Spanish government and the royal family had been preparing for this economic crisis for a long time.

Just the dozens of tons of gold reserves contributed by the Padmanabhaswamy Temple could ensure that Spain would not be too greatly affected during this economic crisis.

What is more, Spain's economic and industrial development is still quite healthy. A significant part of the reason why Vienna suffered such a serious impact is due to the lack of management of the stock exchange and the lack of control over the banking industry.

Those banks and construction companies that were opened purely for speculation were the most vulnerable in this economic crisis.

It is precisely because these enterprises, which were like castles in the air, went bankrupt rapidly that the impact of the economic crisis quickly swept through the entire Vienna.

If there had been fewer of these shell companies, the impact on Vienna would not have been so serious. It was precisely because the bankruptcy of a large number of companies exacerbated the panic in the hearts of the Viennese people, and there were uncontrollable bank runs, which eventually led to banks that could have maintained order also going bankrupt in the bank runs.

This kind of problem does not only appear in this era; it will also appear in later generations.

The financial industry is quite profitable, but it is also quite fragile. Bankruptcy or not can even be affected by a rumor. As long as there are enough people who believe in the rumors of bank bankruptcy and cause a bank run crisis, the bank really has the possibility of bankruptcy.

Conversely, even if a bank faces problems with its capital chain, as long as there is no bank run crisis, it will not face bankruptcy.

To guard against this kind of bank run crisis that is hard to guard against, there are only two ways. One is for the government to play a certain regulatory role over the banks to ensure that the banks do not overuse their funds and always keep a portion of funds for emergencies.

It is precisely because of the previous economic prosperity that a large number of banks used the vast majority of their funds for speculation to make profits.

When the economic crisis broke out, they simply could not obtain funds from other places for turnover. What can a bank without money do besides go bankrupt?

In fact, just as Gao Da said, as long as the Austro-Hungarian government reacts in time, the impact of this so-called economic crisis is actually not that serious.

At least for the Austro-Hungarian Empire, it is not a devastating blow; the countries with the fastest industrial expansion are the ones that are most affected.

Although the Austro-Hungarian Empire has good industry and economy, its development speed in the last ten years cannot even rank in the top five globally.

The countries with the fastest development in recent years are the UK, the US, and Germany, no matter how you rank them. The development speed of the Austro-Hungarian Empire even ranks behind the French, which is also the reason why the Austro-Hungarian Empire will not be too seriously affected.

Sure enough, as Gao Da expected. The impact of the economic crisis was indeed serious for the Austro-Hungarian Empire, but it was only for the first week of the economic crisis.

After those banks and construction companies that only knew how to speculate for profit went bankrupt, most of the remaining ones were factories and enterprises that focused on real industry.

Although these factories and enterprises also faced a relatively serious bankruptcy crisis, they at least had some foundation and could persist for a longer time.

They also waited for the aid from the Austro-Hungarian Empire. On the second day of the economic crisis, the Austro-Hungarian government announced the use of 300 million Rhine guilders to save the market, and prioritized helping some relatively important and large factories and enterprises.

As long as these large factories and enterprises can survive, the various industries that were lost because of this economic crisis will always have a chance to revive.

But if these large factories and enterprises all went bankrupt in the economic crisis, it would not be so easy to rebuild in the future.

After the economic crisis in Vienna was temporarily stabilized, the ones that suffered next became Germany and France.

Among them, the more serious one is Germany; after all, Germany's development speed in these few years is one of the fastest in Europe.

After obtaining 5 billion francs of friendly aid from France, Germany's industrial expansion speed and railway construction speed were extremely fast.

5 billion francs is 200 million pounds, which is an extremely huge sum of money even for the British Empire. It was precisely by relying on this sum of money that the Germans quickly moved the German Empire toward industrialization.

Coupled with the integration of resources and industry in the entire German region, the German Empire leaped to become an industrial power and economic powerhouse in Europe.

But such an identity will not bring any bonuses in an economic crisis; instead, because of the rapid expansion of the economy and industry in recent years, Germany will suffer a more serious economic crisis.

About ten days after the outbreak of the economic crisis in Vienna, the impact of the economic crisis had already spread to the Berlin Stock Exchange.

On the day it was affected, many enterprises faced a serious bankruptcy crisis. Fortunately, the German government had been prepared for these ten days, and on the day Germany was affected, it announced a plan to save the stock exchange market.

Coupled with the fact that Germany's great construction had only just begun a few years ago, it had not yet reached the situation in the United States where production far exceeded demand.

Under the effective control of the German government, the impact of the economic crisis on Germany was not too serious.

5200-word two-in-one chapter, please support!





(End of this chapter)