How to prepare for university admission tests

This year, university admission tests that decide the future of thousands of students will be held from 14 to 16 June. We present ‘selectivitat.io’, the definitive tool to prepare for them and give you the best chance at success.

In 2021, at the age of 22, Jaume Plana created selectivitat.io, a platform that offers all the teaching material to prepare for your GCSE, as well as for university admission tests. The initiative was born from the experience of Jaume and other people around him who had, as he describes, a feeling of abandonment when it came to studying and preparing for these exams.

In just over a year, the platform has collected all the material necessary for the subjects taken in the GCSE: notes sent by the students themselves, notes from academies and professionals, mock exams, grade calculators, courses and podcasts. All with the philosophy of free access, as Plana explains: “It’s free now and forever and ever, we believe that you don’t have to pay for educational material”.

In addition to these basic and free services, there are additional paid services for students who may need the support of a teacher to help them resolve doubts and accompany them in this process.

The grade that decides your future

This is the well-known, and dreaded for some, cut-off mark. The mark that is extracted from the ‘selectivitat’ and which will decide which degree the student can study and at which university, within the range of options that he or she has chosen. A system that Plana himself considers unfair and with a great risk of loss of talent along the way: “There are incredible people who would be perfect in entrance examinations, but they can never get there because the filtering is based on marks” when the employment sector, he remarks, “is not based on marks”.

The current education system focuses on grades from the start. Even in nursery school (from three to five years old) there are schools that initiate students into this selection system that will accompany them for the rest of their academic life. Therefore, they become accustomed to selection by grades. 

However, Plana points out that they are not taught the basis of the learning process and take advantage of it. There are thousands of students who, due to a lack of organisational tools, lack of support or fear of not achieving their objectives, end up failing in this system.

Pressure closes doors

Managing pressure can be very important in terms of the results of the university entrance exams. In this sense, the mental preparation of students is relevant, as Plana explains: “Pupils who get a 14 or very good marks are very good students who know how to handle pressure very well”.

Jaume Plana also points out that we are not prepared for failure, as we are not educated to identify it as something natural and even positive. On the contrary, those who fail are singled out.

The pressure when it comes to tackling studies is subsequently transferred to the way we approach the labour market, which becomes a limiting pillar for many young people. 

Therefore, in addition to academic preparation for the entrance exam, there is also mental preparation, which includes three main aspects: having the support and accompaniment to be able to face these tests; being aware that it is OK if you fail, as there will be new opportunities, and finally, making it clear that your aptitudes will be more important for your future than any grade.

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Twenty years have just passed since the independence of East Timor, the first territory to achieve independence in the 21st century. Five others have followed: Montenegro in 2006; Kosovo, Abkhazia and South Ossetia in 2008; and South Sudan in 2011.

On 20 May 2002, East Timor gained independence after a cruel Indonesian occupation and a UN-supervised transition. Montenegro followed in 2006 and Kosovo in 2008, after more than a decade of conflict in the Balkans. Also in 2008, a few countries recognised the independence of Abkhazia and South Ossetia in their conflict with Georgia. The last country to become independent so far in the 21st century was South Sudan in 2011. 

East Timor (2002)

On 20 May 2002, this enclave in the eastern half of the island of Timor achieved full independence. It did so after a transition of more than two years under UN control. It had been preceded by centuries of Portuguese colonisation and a brutal Indonesian occupation. The new country, sandwiched between Australia and Indonesia, was at the time the poorest in Asia.

The decolonisation of East Timor has certain parallels with that of Western Sahara. Just as Spain’s withdrawal from the African colony led to Morocco’s occupation, the Portuguese withdrawal in 1975 was used by Indonesia to invade the territory and initiate a cruel repression, resulting in between 100,000 and 250,000 deaths. 

The UN-sponsored referendum in 1999 was won by the independence option, which became effective in 2002. However, political and social instability continued until 2012, when the UN mission left the country for good. 

East Timor, which is less than half the size of Catalonia and has a population of more than one million, has a constitution modelled on the Portuguese one. Its gross domestic product (GDP) has grown from less than $500 million in 2002 to more than $1.8 billion in 2020.

Montenegro (2006) 

The territory of Montenegro was under Roman, Byzantine, Serbian and Ottoman control for two millennia, with some intervals of autonomy. In 1878 it became a principality, but after World War I it was integrated into what was to become Yugoslavia, along with Slovenia, Croatia, Serbia, Macedonia and Bosnia-Herzegovina. 

National tensions between the different republics continued after World War II, with Yugoslavia in the communist orbit. To defuse these tensions, a new constitution was adopted in 1974 guaranteeing self-determination for each of the six Yugoslav republics. 

Ethnic conflict erupted in the 1990s. Yugoslavia was dismembered, and only Montenegro remained united with Serbia, although a referendum on 21 May 2006 also established the division of the two countries. Independence was approved with more than 55% of the vote, the condition set by the European Union for accepting the new state.

Since independence, Montenegro’s GDP has grown from $2.722 billion in 2006 to $4.779 billion in 2020. The EU has granted the Balkan country candidate status.

Kosovo (2008)

Like Montenegro, Kosovo went through the domination of multiple empires and kingdoms before being integrated into Yugoslavia. In addition, ethnic clashes have marked its history since the Middle Ages.

In 1990 the region’s assembly proclaimed the Republic of Kosovo within Yugoslavia and two years later it declared independence, although Serbia did not recognise this decision. The 1998-1999 war between Serbs and Albanians ended with NATO intervention and the establishment of a UN protectorate. 

Kosovo’s parliament unilaterally proclaimed independence on 17 February 2008, although it remained under international tutelage for four years. Some 100 countries and multilateral organisations have recognised the new republic, although some states, including Spain, still do not accept Kosovo’s independence. 

The GDP of Kosovo, with a population of almost two million people, has risen from $5.69 billion in 2008 to $7.61 billion in 2020.

Abkhazia and South Ossetia (2008)

The situation of Abkhazia and South Ossetia is somewhat reminiscent of that of the separatist provinces of Ukraine. These two pro-Russian territories in the Caucasus proclaimed their independence from Georgia a year after the break-up of the USSR, but neither country officially recognised the two new states until 2008.

The 2008 war between Georgia and these two separatist provinces prompted Russia’s involvement, which tipped the balance in favour of Abkhazia and South Ossetia. Russia and four other countries then recognised their independence, although most of the international community still considers them part of Georgia.

Abkhazia’s territory covers 8,665 km², while South Ossetia’s is less than 4,000 km². In terms of population, the population of the former is less than a quarter of a million, while the latter barely exceeds 50,000. In 2020, Abkhazia’s GDP was estimated at less than $500 million and South Ossetia’s at around $100 million. The economies of both territories are heavily dependent on Russia.

South Sudan (2011)

Located south of the Sahara Desert in Central Africa, Sudan was once dominated by the Nubians. After centuries of independence, it came under Turkish control in the early 19th century. After another period of independence in 1899, Sudan was invaded by Egypt, which was then a protectorate of the UK.

Sudan ceased to be a British colony in 1956, but ethnic and religious differences plunged it into civil war until 1972 between the Muslim-dominated north and the Christian- and animist-majority south. 

Conflict broke out again in 1983 and lasted until 2005. In January of that year a peace agreement was signed guaranteeing a six-year period of autonomy for the southern region, after which a referendum on independence would be held. 

In the plebiscite, held in early 2011, independence won over 98% of the vote. The southern state’s independence was officially proclaimed on 9 July of that year, leaving the country divided between Sudan and South Sudan.

With a territory almost as large as France, it has a population of around 13 million people and a GDP of just over USD 3 billion.

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The world is constantly evolving, but information does not always move at the same pace. Wikipedia takes this need and makes it its strength: everything you need to know is just a click away. We talked to Pau Colominas, Wikipedian and one of the people in charge of social networks in the Catalan-language version of this encyclopaedia.

In a world where everything advances at an accelerated pace, keeping information up to date is practically a luxury exclusive to social networks. With a filter of objectivity (to a greater or lesser extent) and under deontological codes, the media joins in to explain the daily events that happen everywhere. But where is all this information collected? Be it facts, people, concepts, or dates, the scope of information from the internet is so complex that it becomes diffuse and even unreliable.

In a new episode of People, we talk to Pau Colominas about Wikipedia, a free encyclopaedia where many volunteers collect and disseminate all kinds of content in our language. Everything we would find in a printed encyclopaedia is there. With an important nuance: the information can be updated at any time. A milestone that can only be achieved thanks to digitalisation and the efforts of hundreds of Wikipedians who dedicate their time to disseminating knowledge in Catalan to the Catalan and international community.

Searches in Catalan and quality

Pau Colominas highlights a crucial fact: “Catalan was the second language to upload content to the platform, after English“. Since then, the creation of content in our language has been on the rise, reaching the 700,000 articles that we can currently find. The impact of our language on the platform is significant, and Colominas highlights, in particular, the quality of this content, which, he says, “is often superior to that of other languages”.

The focus of the problem, however, remains when it comes to doing searches, and he points out that “even native Catalans tend to search the internet in Spanish“. Among the reasons, Colominas identifies the configuration of computers and search engines, and the imaginary of times gone by when the presence of Catalan on the internet was low and with lower quality content.

The involvement of an entire community to disseminate knowledge

A large team of volunteers makes it possible for Wikipedia’s mission to come to fruition. Colominas explains that you don’t need to be a scholar in any of the subjects, but you do need to be willing to dedicate time. He stresses that the dissemination of knowledge does not start from the content, but from the sources: “The guarantee of Wikipedia is the guarantee of the sources you use“.

All the information that Wikipedia collects is characterised by the fact that it has been published before, and this alone reduces the scope for inventiveness. In addition, a team of Wikipedians like Pau filter and identify any content that may be offensive to individuals or groups, or that may represent a conflict of interest.

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The Booksellers’ Guild predicts a record-breaking day for this Diada because there are more book stands than ever before. But among this sea of new books, which ones talk about the economy or address the current economic situation?

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The geopolitical tug-of-war between East and West in recent years has revealed a paradigm shift that is becoming increasingly evident. We have returned to a multipolar world where US hegemony is losing strength year by year. We analyse the causes and consequences of this rebalancing and sharing of global power.

The world is more interconnected than ever, but power is more distributed. The distribution of power in global geopolitics has historically varied between states. From the bipolar system established during the Cold War period, in which two great powers shared power, a unipolar world emerged after the collapse of the USSR and the communist bloc. This change in the world order established a substantive US hegemony based on two pillars: military and economic power.

Yet the scope and pre-eminence of American geopolitical influence was unique and went far beyond the definition of a traditional superpower. D. Hubert Vedrine, the French foreign minister, coined a new term, hyper-power, to describe a domain of power that not only dictated the global economic, technological or military realm, but also included the cultural imperialism sarcastically detailed by members of the German music group Rammstein in the well-known song Amerika.

That said, the international community was quick to plant the seeds to challenge this new status quo. Emerging economies, such as the BRICS bloc, began to position themselves in an organised way on the international stage, giving meaning to the concept of a multipolar world that defined the foundations of a new political and economic order.

The rise of Asia and the decline of the West

In 1988, the Chinese leader Deng Xiaoping told the then Indian prime minister Rajiv Gandhi

that the arrival of the ‘Asian century’ was far from a foregone conclusion until China, India, and neighbouring countries developed. Three decades later, very few doubt that we are living in a new golden age of Asia. Asia is the world’s fastest-growing region and the largest contributor to global GDP, with China as the world’s second-largest economy.

Economic cycles and financial markets are less and less focused on the United States. The use and abuse of economic sanctions against any corporation or country, even allied countries, that does not submit to the interests of the American giant only strengthen efforts by China, Russia, and other countries not aligned to the Western geopolitical bloc to create alternative economic systems.

Beijing, with its focus on gaining technological independence and linking other countries to the Belt and Road Initiative, invests its capital, helping to lift the regional economies of parts of the world forgotten by the West, or from which former colonial powers demand much more, often with the use of force, for little in return. A whole set of multiple alliances that further divide and distribute centres of power and influence.

While we are facing a necessary and inevitable rebalancing of the world order, ultimately, whether states can make good use of the resurgence of this new trend towards multipolarity will depend on their geostrategic location, demographics, energy resources, and, above all, their economic power, which will demarcate the limits of their autonomy relative to the established superpowers.

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Most of the time we learn about economics on our own. Not enough financial concepts are taught at school. That is why, if you want your son or daughter to have knowledge in this field, we recommend five books to help them understand the value of money and saving.

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The Catalan economy is made up of a veritable “great spider’s web,” as Roger Vinton calls it in the title of his book. Faced with this idea, and with the suspicion that the knots and actors in this web are poorly explained, a good number of books have appeared on a recurring basis that attempt to untangle it. We review them in La Plaça.

The reflections that follow, whether in the form of memoirs, such as those by Josep Pla and Cristian Segura, or in the form of journalistic essays, such as those by Roger Vinton, Gemma Garcia Fàbregas, Jordi Amat, Pere Cullell and Andreu Farràs, describe how the productive and financial economy works in the hands of elites who prefer to remain in the shadows.

• ‘Homenots’, by Josep Pla. ‘Homenots’ is a series of 60 profiles by Josep Pla on figures of his time. They were published between 1958 and 1962 by Editorial Selecta and between 1969 and 1974 by Editorial Destino in four volumes. In the preface to one of the volumes, Pla stated that, for him, “a ‘homenot’ is a singular, unusual type, a person who has been significant, in any activity, in a remarkable way.” Among these profiles are those of Prat de la Riba, Jaume Bofill, Joan Miquel Avellí and Ramon Godó, among many others, who make up the economic and political substratum of the country.
• ‘L’oasi català’ (2001), by Pere Cullell and Andreu Farràs. The Catalan oasis refers to the close relations that developed between the Catalan bourgeoisie and the centralism of the Madrid court in the 19th century. The term seems to have been coined by the journalist Manuel Brunet. And it seems that, today, there would be some 400 people who would represent this Catalan elite spread across cultural and economic centres. With this expression, the journalists Pere Cullell and Andreu Farràs titled their essay, in which they explain the family, educational and summering relationships of a good part of these leading figures of Catalan society, who embrace the entire Catalan political spectrum.
• ‘Els senyors del boom’ (2014), by Gemma Garcia Fàbregas. The journalist touches in depth a very sensitive story, that of the real estate gold rush experienced in the Catalan Countries and its social, political and economic impacts, with first-hand information and a highly documented analysis that opens a new perspective on the reasons for a catastrophe foretold as was the real estate bubble.
  ‘La gran teranyina’ (2017), by Roger Vinton.  ‘La gran teranyina’ reveals the opaque structure from which certain agents exercise the power through which they control events and situations that affect our society on a daily basis. This book allows us, in Vinton’s own words, to “open our eyes and become aware of the immense power of the individual.” A profound investigation that changes the perception of Catalonia and that some have considered a true reference manual or compass in the jungle of power.
• ‘El fill del xofer’ (2020), by Jordi Amat. Following the dark figure of Alfons Quintà -journalist, lawyer, merchant navy officer and judge, who on 19 December 2016 murdered his wife and then committed suicide with a hunting rifle-, Jordi Amat reflects on power. Behind a dazzling journalistic career, which spans from the direction of TV3 to the talk shows of Intereconomía, a dark trajectory is hidden, full of blackmail, sexual persecutions, abuses of authority and various tricks, which shows how the sewers of power work in Catalonia.
• ‘Gent d’ordre’ (2021), by Cristian Segura. Halfway between an essay, a memoir and a journalistic chronicle, Cristian Segura writes an exhaustive portrait of Barcelona’s elites. A society in transformation due to globalisation, the consolidation of the welfare state and also the hegemony of Catalan nationalism. Elites do not disappear, they are transformed. And Barcelona is the paradigm of this.

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Central banks have become an indispensable tool for the functioning and regulation of the global monetary system. But it all started with the financial panic triggered by Johan Palmstruch, banker and creator of the modern banknote.

Johan Palmstruch is remembered today as a pioneer, but he could also be considered a swindler. This 17th-century Dutch businessman and merchant modernised the world’s monetary and banking system almost unintentionally. Just for his own interests.

The first central bank

Sweden was embroiled in armed conflicts that required the crown to invest more and more money. So Palmstruch persuaded King Carl X Gustaf of Sweden to set up Stockholms Banco in 1657. It was a private bank, but the king was the CEO and half of the profits went to the crown. It was, therefore, the forerunner of central banking.

The business case was obvious because the Swedish government supported the bank. At that time there were copper, silver and gold coins in the country. Sweden was a major producer of copper, but debt from military adventurism kept accumulating and the parity of the copper coinage with silver and gold was becoming more and more difficult. Copper was depreciating due to the arrival of low-cost copper from Asia, which meant that 19-kilo copper coins had to be produced to maintain parity.

The role of deposits

In this context, Palmstruch introduced another novelty: he asked for permission to use customer deposits to give loans. This is quite normal now, but at the time it was innovative. He made a risk calculation and thought that a scenario where all customers would come forward to claim their money would never arise. He was wrong.

Copper continued to depreciate, and in 1660 the Swedish government decided to issue new coins. The bank’s customers asked to withdraw their old coins to spend them before they continued to lose value, but Palmstruch could not give everyone their money back. What was his next idea?

The creation of the modern banknote

Now, banknotes are our commonly used currency, but back then they were nothing more than a forward flight. A type of promissory note that he invented and got the crown to authorise it. The notes they printed were nothing more than a promise to pay the bearer. Palmstruchers, as they were known, were the first modern banknotes. We insist that this was a monetary innovation that was only born to plug a financial hole.

Paper money as a certificate of deposit had been in circulation for quite some time. But the Palmstruchers were the first banknotes in the current sense: issued on paper for a fixed amount, to the bearer, backed by the government and without the need to specify the depositor, the amount of the deposit or the interest. Was that enough? It wasn’t.

Bailout and central bank

Stockholm’s Bank issued too many banknotes and credit soared. The bank failed in 1664 and the government had to bail it out and return the money to the customers. Palmstruch went to prison, was released in 1670 and died a year later.

He had been convicted of fraud and, strangely enough, ended up creating the entities that would have to regulate that there was no fraud. As the Stockholms Banco was liquidated in 1667, the following year the government created the Bank of Stockholm. Now it was the first fully public central bank. With parliamentary control, to finance the government and with a ban on issuing banknotes.

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The chronological arc from the Treaty of Tordesillas to the declaration of independence of the United States of America represents the first process – on a global scale – of the distribution and exploitation of the whole world by the European monarchies. During this period, the succulent income produced by the spoils of war or by the indiscriminate plundering of the native populations was transformed into an unprecedented binge of gold and silver, which was introduced into the European economy. For this reason, the construction of the first colonial empires was based on a mercantile economy that enabled them to live up to expectations.

From the outset, the European monarchies were convinced that all the territories of the world belonged to them by right of conquest. In this way, cartography allowed them to gradually extend and possess ownership of land, over which they legitimised themselves as possessors in order to impose – not always by force – their model of civilisation on the native societies.

This process of cultural supremacy was based on the religious certainty of questioning the true human nature of the natives. And the firm belief in this reasoning will motivate the European monarchies to project a geography of large spaces to be Christianised. The greed of the newcomers led to numerous abuses and genocides, but also to an unprecedented demographic catastrophe, as the territories of the new world were reduced to 80% of their native population.

The progressive development of maritime techniques – such as the improvement of the compass, the construction of caravels or the updating of world maps – will allow Europeans to be able to navigate all the seas and oceans that make up the planet in just a few years. This feat will result in the division of the world into two halves, two geographical lines which, drawn between the two poles, will give them the power, signed by the papal authority, to divide the world into zones for navigation, fishing and conquest. The first line will be 370 leagues west of the Cape Verde Islands, while the second will be set at 297.5 leagues east of the Molucca’s.

The discovery of important deposits of precious metals in America – between Mexico and Peru – or the arrival on the islands of Southeast Asian species, led to the foundation or re-foundation of important American, African or Asian cities, which acquired a different territorial role in order to ensure a regular flow of wealth to Europe. The European monarchies thus began to control all trade passing through their territories in order to protect their economic gains.

From the beginning of the 16th century until the mid-18th century, the first colonial empires would maintain a strict mercantile monopoly with their colonies, and trade with people or companies that were not subjects of or related to the Crown would be prohibited. Castile, for example, regarded the English, Dutch and French, not as competitors but as enemies and the cause of acts of piracy.

The colonial mercantilist system

Trade with the colonies was based on the premise that the colonists had to sell their raw materials – at a low price and with high taxes – exclusively to companies designated by the Crown. At the same time, the colonists would only be able to buy consumer goods manufactured by this select group of entrepreneurs. Therefore,  monarchies will favour the unlimited enrichment of companies and individuals close to the state, since they will be denied competition. This mercantilist system will create useless needs for the natives and will seek to perpetually maintain the colonies underdeveloped – whether American, African or Asian – in order to nullify possible direct competition with the metropolis.

And to make matters worse, the senior civil servants close to the king’s council will also play a very important role in this innovative economic system, since they had the ability to speed up or delay bureaucratic procedures in order to favour one or the other. The emergence of illicit and parallel trade between colonies was therefore inevitable and led many entrepreneurs, both large and small, to seek ways of circumventing the bureaucratic controls imposed by the Crown itself.

Acting as nouveau riche, the first colonial empires – mainly Castile – will spend an indecent amount of economic resources to build their concept of civilisation. This obsession – sometimes uncontrolled – will lead them to embark on countless conflicts of all kinds, such as theological disputes, family conflicts, commercial affairs or lavish megalomaniac constructions.

Financing the empire with precious metals

Coinciding with the time of greatest economic extraction from the American colonies – between the late 16th and early 17th centuries – Castile spent more than 7 million ducats to maintain its fleet in the Mediterranean during the famous Battle of Lepanto. In approximately seven years, a staggering 11.7 million ducats would be spent to finance the countless campaigns in Flanders.

To commemorate the victory in the battle of Saint-Quentin against the French troops, more than 6.5 million ducats will be spent to build the magnificent Royal Monastery of San Lorenzo de El Escorial. Thanks to the construction and launching of the Grande y Felicísima Armada, the well known Invincible Armada, 9 million ducats were sent directly to the bottom of the sea. And of course, this Catholic and universal civilisation will need to build a new capital on the banks of the Manzanares River. For the reader who is curious about the conversion, the ducat of the 16th and early 17th century would currently be equivalent to around 167.1 euros. True, the figures are… shocking!

Therefore, between 1500 and 1650, the Castilian monarchy – and by proximity, the rest of the European monarchies – lived in a veritable economic bubble generated by the massive influx of precious metals. The latest studies estimate that the Castilian Crown extracted some 17,000 tonnes of silver and 70 tonnes of gold from the American colonies. This metal binge led the state to have a distorted view of the real economy.

The paradox occurred when, despite the huge inflow of gold and silver and the collection of high taxes, they did not cover all the expenses incurred by the state. We should bear in mind that the Castilian Crown would only use this extraordinary wealth to finance all the delusions of grandeur of the Castilian elites, which in most cases would come into direct conflict with the real needs of the population. For this reason, when the oligarchies of a country were more interested in working for lavishness than for the real possibilities offered by the reinvestment of capital, all this leads to the destruction of the productive fabric itself.

Indebtedness of the Castilian Crown

By the mid-17th century, the Castilian Crown was in debt to the tune of more than 100 million ducats. This gigantic debt forced them to declare successive suspensions of payments. To plug this hole, the Crown was forced to issue a large amount of public debt, which would end up in the hands of the main European banks, such as the German banks – the Fuggers and the Welsers – and the Genoese banks of the Spínola, Centurione, Balbi, Strata and, above all, Gio Luca Pallavicino. The Crown will pay the Welsers by granting them the exploitation of the mines in Mexico and the right of conquest over extensive territories in what are now Venezuela and Colombia. For their part, the Fuggers will obtain all the commercial concessions over the territories of Chile and Peru. Today, they are some of the most powerful families of the continent. And, all the luxourious palaces of the strada nuova de Genova, principal artery of luxury in the city, still today, they constitute the biggest concentration of aristocratic residences in all of Europe.

Faced with the successive financial crises that the Castilian Crown began to suffer, many European businessmen living in the American colonies preferred not to ship their precious metals to Castilian ports – a monopoly granted in Cádiz and Seville – for fear of the massive confiscations decreed by the Crown. They, therefore, sought to invest their assets in other emerging sectors of the colonial economy at the end of the 17th century, such as agriculture, livestock and manufacturing production.

The Castilian Crown was therefore forced to look for new and regular sources of income. For this reason, it set in motion the ambitious plan of the king’s minister, the Count-Duke of Olivares, known as the Unión de Armas, which would require each kingdom that formed part of the Hispanic Monarchy – that is, mainly Portugal and the Crown of Aragon – to contribute a certain amount of money and soldiers.

Relaxing the trade monopoly

Portugal, which had been part of the Hispanic Monarchy since the end of the 16th century, refused to grant any further economic contribution, given that Castile exploited its colonies, which led to a war that lasted more than 28 years. Finally, with the economic support of England and Holland, Portugal managed to free itself from the control of the Habsburgs, but the price it had to pay involved the cession of important territories in Brazil and the change of ownership of the colonies of Ceylon (now Sri Lanka), Cape Town, Goa, Bombay, Macao and Nagasaki, among others.

As for the Crown of Aragon, the Castilian oligarchy did not gauge the situation correctly when it accepted that King Philip IV would swear the Catalan constitutions, a sine qua non condition for obtaining the desired funds. Ignorance of the laws regulating the king’s functions within the Catalan territories would be the focus of important institutional discussions, given that the king – within the Principality – was obliged by law to explain the use of the resources granted. For their part, the Catalans were more interested in having their proposals for new Catalan constitutions approved and grievances addressed than in engaging in absurd wars.

But at the genesis of the institutional debate – between Castile and the Principality – we find a much deeper problem. If, since the end of the 16th century, Castile had moved towards a political system of an absolutist nature, where power resided in a single person, who decided without being accountable to any parliament, the opposite was true in the Principality, where the General Courts of Catalonia were the legislative body representing all strata of society, including the king.

The constant inflow of precious metals into the Castilian economy would remain stable until the mid-18th century, but only a very small percentage would remain within the Castilian economic system since the rest would continue to be used to pay off the monstrous debt of the State. Historiography estimates that it was not until 1820 that the Spanish state recovered from this huge expenditure, largely due to the fact that it had annexed the productive economy of the whole of the peninsular Mediterranean strip at the beginning of the 18th century.

The system of privileges and monopolies developed by the Bourbon trade policy continued to fail, and new agents had to be introduced to guarantee the viability of trade with America. Therefore, with the Royal Decree of Free Trade of 2 February 1778, the monopoly of Cádiz and Seville was definitively broken and Catalonia’s direct trade with America was favoured, which provided a new way of doing business. Funnily enough, today, 34% of Spain’s GDP continues to be contributed by the productive economy of the entire Mediterranean peninsular strip. Therefore, nothing happens by chance…

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Leaving money to a Christian for his own benefit was considered usury, so loans could only be made to enemies in times of war. Loans condemned bankers to hell because they involved a double sin: stealing money from your brother and stealing time to repay the loan. And time only belongs to God.

The interest that bankers charge on the money they lend is at the heart of the banking business and has always been controversial. Currently, it is because money is created from nothing using the loan as an asset, as we explained in the first chapter of the El Diner series. But centuries ago, the discussion was moral: the Church considered usury. The Old Testament, in Exodus, was clear when it said: “If you lend money to any poor person of my people who lives with you, do not treat him like a moneylender, nor pay him interest” (Exodus 22: 24). The essential idea was clear, it was not right to enrich oneself with the needs of others. This precept directly attacks, therefore, the waterline of the banking business.

Towards the 12th century, the banking business began to flourish, but the Church continued to condemn bankers to hell. In the opinion of the ecclesiastics of the time, usury was a double sin because you were usurping money from a Christian, but you were also stealing the time that he should invest to earn that money that he should return to you. And there was one of the big problems: time only belonged to God. Therefore, with the interest on the loans, the bankers were robbing an equal and God.

The Jewish opportunity

The Church, therefore, prohibited loans with interest between Christians. They could make enemies, with the idea of weakening them. Christians could not make loans to Jews either, because the Church considered them brothers. In this way, so to speak, the market of potential clients for Christian bankers was significantly reduced. And it was, precisely, the Jews who took advantage of that market niche. It was then that their fame as lenders skyrocketed, placing themselves at the centre of the financial business ever since. They had no such qualms: they lent money to anyone who asked for it, in exchange for interest. All of this ended up forcing the Church to rectify. And she did it in a very ingenious way: creating Purgatory.

Bankers’ Purgatory

It was evident that the Church had lost a business opportunity for Christianity. But the potential bankers had no desire to go to hell. At that time, loans were seen as a way to take advantage of the weak and not as a way to allow someone to pursue an idea. That is to say, evidently, the concept of productive loans or entrepreneurs did not exist. In any case, the Church rectified it by creating Purgatory. The bankers would no longer be condemned to eternal Hell, but to a place where they would be temporarily until they could purge their sins and enter Heaven. The measure was based on the Tractatus de Purgatorio Sancti Patricii by the Irish clergyman H. de Saltrey, which explained the journey of a knight to purge his sins.

This is how the Church sought to accommodate usury and loans within the Faith. The idea spread among the clergy during the 13th century: bankers could now save themselves, and the Church began to build a much closer relationship with the power of money.