King Philip continued to be interested in these remarkable dreams, but he was now so preoccupied by the rebellion of the Netherlands that no decision was made. Still, letters continued to flow across the Atlantic to discuss what might be done on the other side of the Pacific; and the Chinese offered for their part, to set up a small commercial enclave on the coast of Fujian comparable to what was being done for the Portuguese in Macao. This would be led by Augustinian friars backed by a small unit of Spanish soldiers headed by yet another old comrade of Legazpi, Miguel de Loarca, an Asturian who had achieved a large encomienda on Otón. For the Philippines had been divided up into encomiendas among the conquistadors like all Spanish colonies in the Americas. (An encomienda was a grant of people for whom the conquistadors would have responsibility and benefit.)

The first Spanish expedition set off for China from Manila in June 1575. Some of the soldiers in the flotilla which sailed off north believed that they were about to rival the achievements of Cortés and Pizarro. However the religious members arranged to stay in China, the soldiers returned, their appetites stimulated, to Manila. 

By then, yet another governor had taken over there. This was Dr Francisco de Sande, who was educated (he had been at Salamanca University), ambitious and persuasive. He wrote on June 6, 1576, to King Philip that he had devised a plan for the subjugation of China by four to six thousand arquebusiers and pikemen, partly from New Spain, partly from Peru. Sande made several suggestions as to how this imperial army could conquer China by a very just war. Were not the Chinese soldiery beneath contempt? Though there were many of them, they were idolatrous sodomites, given to robbery and piracy. That was the kind of comment that Spaniards had often made when contemplating a new conquest. There were certainly equivalent remarks made in New Spain (i.e. Mexico). Sande thought that the best course would be first to conquer one province and convince the population that the Spaniards were liberators. Had that not occurred in relation to Cortés's policy towards Tlaxcala, and also the Totonaca near Veracruz? Spain would then use the Chinese collaborators to help the subjection of other provinces, rather as Spaniards had used the Mexica after 1521. 

These ideas began to take hold everywhere in the empire. Thus Diego García de Palacio, judge of the Audiencia (supreme court) of Guatemala, told the king in a letter of March 1578 that it would be as easy as it was desirable to recruit 4,000 men in Central America and embark them in galleys for China. The king should be asked to help by sending bronze with which to make guns.

The Council of the Indies was doubtful about this. The emperor of China was said to have five million men under arms with good weapons, so the conquest might not turn out to be so easy as Judge Palacios thought it would be. The king was now equally dubious "as to your idea of conquering China which it seems to you we ought to do now." He wrote to Governor Sande: "It really seems that now is not the moment to discuss the matter." Instead the king wanted to send presents to the emperor in Peking. These included portraits of himself by his favourite court painter Sánchez Coello.