Historia monetaria Guatemala (ep3): Gobierno conservador de los 30 años (1840-1871)

Summary

This video explores the monetary history of Guatemala during the 30-year Conservative government (1840-1871). It discusses the economic challenges faced due to a lack of currency, the suspension of coin production, and the introduction of the US dollar in 1851. It also covers the failed attempts to establish banks, the consolidation of foreign debt, and the resistance to adopting a new decimal system in 1869. The video highlights key events like the creation of the Guatemalan mint, the English debt, and the eventual fall of the Conservative regime, leading into the start of the Liberal period.

Takeaways

• 😀 In 1840, the issuance of coins from the Central American federation ceased, and Guatemala didn't issue its own coins until 1853.
• 😀 By 1851, the US dollar became legal tender in Guatemala, and its exchange rate was set at 1 to 1 with the peso.
• 😀 During this time, Guatemala accepted foreign currencies from countries such as France, Italy, Belgium, Switzerland, Spain, Mexico, Chile, Peru, and Venezuela.
• 😀 There were no public or private banks in Guatemala during this period, but credit was provided by merchants (75%) and religious orders (25%).
• 😀 In 1853, a debt of 30,000 pesos was raised to fund the Guatemalan mint, which resumed minting coins regularly in 1859.
• 😀 The coins minted in Guatemala during this period, especially the 'Carreras' coins, became highly coveted by collectors and circulated as far as the Philippine Islands.
• 😀 In 1856, Guatemala renegotiated its external debt with English creditors, but payments would fall into default again by 1863.
• 😀 In 1864, Guatemala made its first attempt to create a private bank, but it failed due to lack of public interest.
• 😀 A failed attempt to create the National Bank of Guatemala took place in 1867, marking another unsuccessful attempt to establish a state bank.
• 😀 In 1869, Guatemala attempted to introduce the decimal system to replace the Spanish monetary system, but the change faced resistance from the population, contributing to the fall of the Conservative regime in 1871.

Q & A

What was the situation regarding the shortage of cash in Guatemala during the 30-year Conservative government?

During the 30-year Conservative government (1840-1871), the endemic shortage of cash in Guatemala worsened. This was primarily due to the complete paralysis of the Guatemalan mint, which had stopped issuing coins in 1840. It wasn’t until 1853 that coins of the Republic of Guatemala were issued.

When did the issuance of coins in Guatemala resume, and what emblem was featured on them?

The issuance of coins in Guatemala resumed in 1859 after a debt of 30,000 pesos was incurred to fund the Guatemalan mint. The coins of this period featured the emblem of the Republic of Guatemala.

What was the role of foreign currencies in Guatemala during this time?

In 1851, the US dollar was accepted as legal tender in Guatemala at a 1:1 exchange rate with the peso. Additionally, coins from countries such as France, Italy, Belgium, Switzerland, Spain, Mexico, Chile, Peru, and Venezuela were also accepted as means of payment.

How did the credit system function in Guatemala during this period?

During this period, financial intermediation existed but not through formal banks. Merchants and religious orders provided credit, with 75% of credit coming from merchants and 25% from religious orders. This structure was similar to the credit system in Europe at the end of the Middle Ages.

What was the significance of the coins minted in Guatemala during the 1850s?

The coins minted in Guatemala during the 1850s, especially those known as 'Carreras' coins (named after President Rafael Carrera), were of high quality. These coins circulated widely, even reaching places as far as the Philippines, and remain highly coveted by collectors today.

What led to the failure of the first private bank attempt in Guatemala in 1864?

In 1864, an attempt to create the first private bank in Guatemala failed due to a lack of interest in the subscription of shares by the public. Previous attempts to create banks had also failed, and this particular private bank project was eventually abandoned.

What was the impact of the debt consolidation in 1856 on Guatemala?

In 1856, a consolidation of Guatemala’s external debt took place, including a renegotiation with creditors of the English debt. While debt payments resumed, the situation was short-lived, and the debt fell into default again by 1863.

Why did the attempt to introduce the decimal system and replace the Spanish monetary system in 1869 face resistance?

The attempt to introduce the decimal system in 1869 faced significant resistance from the population, largely because the Spanish monetary system had been in place for a long time, and the people were reluctant to abandon it. Some historians consider this resistance to be one of the main reasons behind the fall of the Conservative regime in 1871.

What was the 'English debt' and how did it affect Guatemala during the 19th century?

The 'English debt' refers to the large amount of debt that Guatemala owed to the United Kingdom. In 1869, Guatemala entered into another massive loan agreement with the UK, amounting to half a million pounds sterling at 6% interest. This debt, along with earlier debts, was a source of discontent among the population and contributed to the fall of the Conservative regime.

What happened to the 'English debt' after the Conservative regime fell in 1871?

The English debt, which had been punctually paid from 1869 to 1876, fell into default again in 1876 due to Guatemala’s war with El Salvador. The debt was eventually fully paid off by 1968, although most of it was cleared by 1931.