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Well, it is a bit overstated to say the Spanish Empire fell in the 1600's, although it was weakened and Britain became a much more serious challenger on the world stage by the end of the 1600's.
Spain's empire, or at least its strength, was based on nearly a century of riches mined and gathered in North and South America and shipped home. This "Golden Age" allowed them to build one of the most modern societies ever, as well as the largest, most powerful military in the world. But it was based on the supply of gold and silver coming into the country being permanent, which was impossible. Once the river of riches dried up or slowed down, the empire would be weaker for it.
Thanks to some serious luck on the part of upstart Protestant Britain, the massive Spanish fleet of galleons sent to England in 1588 to punish their Protestant rebellion was bottled up in the Thames River and defeated, with the remnants of that fleet destroyed by a storm on the coast of France. The Empire would be around for three more centuries, but it never fully recovered from these things. By the early 1800's, many of its colonies had declared independence.
In the early 1600's Spain experienced a strong land hold and great economic By the time 1600 was to arrive, however, the country was in wealth. Land holdings included the largest islands in the Caribbean, most of Mexico, Central America, the Philippines, Florida, and South America.
Spain entered into wars that they lost against Holland and France and then lost control of Portugal. By 1630 they had lost control of the majority of the silver that was coming from the Americas. In addition their trading power had dwindled.
In the 1700's Charles II died. The dynasty of the Habsburg ended. Spanish succession broke out involving France, England, and Austria.
The 17th century was a time of political and social decline. The plague has caused many deaths and many people had immigrated to other regions. SpainSpain
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