1. Do you feel the “American dream” is open and available to everyone in our society today?

2. Growth of Towns and Trade

3. Bellwork:
From what you know about how Europe was organized (or not organized), what would have caused trade in Europe to break down?
Many Small Kingdoms
Almost Constant War
Shifting Alliances
No Consistent Laws

4. Where did Trade first revive?
Italy…
Venice
Florence
Milan

5. How did merchants and traders compensate for a lack of unified governments and laws?
The Hanseatic league
A trading bloc, like the European Union or NAFTA is today
This was an association of cities, eventually 100 cities participated
All Members agreed to follow certain rules
The Association provided protection for its members
The association could also collectively punish anyone who harmed one of their member cities

6. The Hanseatic League

7. Market Towns and Fairs
Think of them as the shopping malls of the middle ages
Certain towns held fairs on a routine basis
Everyone knew where they could go to sell or buy

8. Growth of Manufacturing
Domestic System
Took place in people’s homes

9. Growth of Banking Money became standardized
Wealthy kingdoms and cities minted their own money
Paying with money replaced the barter economy
People started banks to keep the money safe and to lend it!
Who might need to borrow money?
Merchants and manufactures to buy supplies
Kings to finance armies and wage wars

10. So, what’s important here?
The “Power Structure” in Europe started to shift.
Now, it wasn’t just the king and the other large land-owners who were important.
Bankers, merchants, manufacturers and traders were now getting wealthy and powerful.
They are known as the…
“middle class”
Some members of the middle class became more wealthy than the nobles!

11. Growth of Capital What did they do with this wealth? They invested it!
Capital= Accumulated wealth, available for investing.
Capital could now be invested in things like…
Sea Explorations
Trading Companies (ie. Dutch East Indies Co.)
Armies!

12. What happened next? The economies in Europe began to modernize.
Wealthy individuals started taking control of the land, labor and capital, rather than the king.
When individuals control land, labor and capital, this is called a Market Economy.

13. Exit Pass…let’s see if you can answer this question!
How did the growth of trade and manufacturing lead Europe to develop into a “market economy?”
BTW: Don’t forget tonight’s reading homework- pages Take your own notes!