section_path: The Spanish Habsburgs (1516–1700)
section_name: The Spanish Habsburgs (1516–1700)
paragraph_text: The Spanish Habsburgs (1516–1700)
  
  As a result of the marriage politics of the Catholic Monarchs (in Spanish, Reyes Católicos), their Habsburg grandson Charles inherited the Castilian empire in the Americas and the possessions of the Crown of Aragon in the Mediterranean (including all of south Italy), lands in Germany, the Low Countries, Franche-Comté, and Austria, starting the rule of the Spanish Habsburgs. The Austrian hereditary Habsburg domains were transferred to Ferdinand, the Emperor's brother, whereas Spain and the remaining possessions were inherited by Charles's son, Philip II of Spain, at the abdication of the former in 1556.
  
  The Habsburgs pursued several goals:
  
  "I learnt a proverb here", said a French traveler in 1603: "Everything is dear in Spain except silver". The problems caused by inflation were discussed by scholars at the School of Salamanca and the arbitristas. The natural resource abundance provoked a decline in entrepreneurship as profits from resource extraction are less risky. The wealthy preferred to invest their fortunes in public debt (juros). The Habsburg dynasty spent the Castilian and American riches in wars across Europe on behalf of Habsburg interests, and declared moratoriums (bankruptcies) on their debt payments several times. These burdens led to a number of revolts across the Spanish Habsburg's domains, including their Spanish kingdoms.
  
  Philip II of Spain (r. 1556–98) conquered the Philippines in 1565, making him ruler of the first true globe-spanning empire. His victory in the War of the Portuguese Succession led to the annexation of Portugal in 1580, effectively integrating its overseas empire—encompassing coastal Brazil and African and Indian coastal enclaves—into Spain's domain. His reign was marked by additional conflicts, including the Eighty Years' War, and the Anglo-Spanish War. The attempted invasion of England by the Spanish Armada in 1588 marked the first southern European threat to the British Isles since Roman times. Philip also became embroiled in conflicts with the Ottoman Empire, and in 1571, his galley fleet achieved a significant victory at the Battle of Lepanto, but the Ottomans quickly rebuilt their Mediterranean fleet and forced a truce on Philip in 1578.
  
  By the mid-17th century, Spain's global empire burdened its economic, administrative, and military resources. Over the preceding century, Spanish troops had fought in France, Germany, and the Netherlands, suffering heavy casualties. Despite its vast holdings, Spain's military lacked essential modernization and heavily relied on foreign suppliers. Nevertheless, Spain possessed abundant bullion from the Americas, which played a crucial role in both sustaining its military endeavors and meeting the needs of its civilian population. During this period, Spain displayed limited military interest in its overseas colonies. The Criollo elites and mestizo and mulatto militia provided only minimal protection, often assisted by more influential allies with vested interests in maintaining the balance of power and safeguarding the Spanish Empire from falling into enemy hands.