<P> Banks, stock exchanges, and insurance became ways to manage the risk involved in the renewed trade . New laws came into being . Travel became safer as nations developed . Economic theories began to develop in light of all of the new trading activity . The increase in the availability of money led to the emergence of a new economic system, and new problems to go with it . The Commercial Revolution is also marked by the formalization of pre-existing, informal methods of dealing with trade and commerce . </P> <P> Spain legally amassed approximately 180 tons of gold and 8200 tons of silver through its endeavors in the New World, and another unknown amount through smuggling, spending this money to finance wars and the arts . The spent silver, suddenly being spread throughout a previously cash starved Europe, caused widespread inflation . The inflation was worsened by a growing population but a static production level, low employee salaries and a rising cost of living . This problem, combined with underpopulation (caused by the Black Death), affected the system of agriculture . The landholding aristocracy suffered under the inflation, since they depended on paying small, fixed wages to peasant tenants that were becoming able to demand higher wages . The aristocracy made failed attempts to counteract this situation by creating short - term leases of their lands to allow periodic revaluation of rent . The manorial system (manor system of lord and peasant tenant) eventually vanished, and the landholding aristocrats were forced to sell pieces of their land in order to maintain their style of living . Such sales attracted the rich bourgeois (from the French word referring to this dominant class, emerging with commerce), who wanted to buy land and thereby increase their social status . Former "common lands" were fenced by the landed bourgeois, a process known as "enclosure" which increased the efficiency of raising livestock (mainly sheep's wool for the textile industry). This "enclosure" forced the peasants out of rural areas and into the cities, resulting in urbanization and eventually the industrial revolution . </P> <P> On the other hand, the increase in the availability of silver coin allowed for commerce to expand in numerous ways . Inflation was not all bad . </P> <P> Various legal and religious developments in the late Middle Ages allowed for development of the modern banking system at the beginning of the 16th century . Interest was allowed to be charged, and profits generated from holding other people's money . </P>

Describe the system of trade among european nations and their colonies