The Silver-Mad Siblings
With a lock on much of the East Texas Oil Field, one of the world’s biggest oil deposits, H.L. Hunt (1889 – 1974) was one of the world’s richest men. His sons Nelson, William, and Lamar – the last a founder of the American Football League and Major League Soccer – were also quite wealthy. Especially Nelson, who drilled for oil in Libya and made a fortune. However, Nelson Hunt became a crackpot who feared a US government conspiracy to steal his wealth. So to protect it, he decided to buy a lot of silver, and hoard it in Switzerland. Then he decided to buy all the silver, and persuaded his brothers to join him in a bid to corner the global silver market.
The Hunt brothers went on a silver buying spree in the 1970s. When they ran out of money, they borrowed heavily to buy more silver. By 1979, they had accumulated about 100 million troy ounces – almost 7 million pounds – of the stuff. That was almost half the world’s transportable supply. That speculation caused the price of silver to spike by over 800%, from $6 an ounce in early 1979, to over $50 by early 1980. The brothers made about $4 billion in paper profits, but in reality they had simply created a huge asset bubble, that was bound to burst sooner or later. When it did, they lost big, and Nelson Hunt in particular went from visionary genius to crackpot loser.