The silver tale of Hunt brothers

In the early 1980s, Nelson Bunker and William Herbert Hunt attempted one of the most spectacular—and ultimately unsuccessful—financial schemes in stock market history: cornering the silver market. While their plan failed, it wreaked havoc on the entire precious metals market and saw one of the world's greatest fortunes evaporate in a matter of months.

The Rise of the Hunt Empire

Nelson Bunker Hunt and William Herbert Hunt were born into one of America’s wealthiest families. Their father, Haroldson Lafayette Hunt (H.L.), amassed a fortune in the Texas oil industry during the 1920s and 1930s. By investing oil profits into successful ventures, the Hunt family became one of the richest in America.
When H.L. died in 1974, he left behind an enormous fortune. H.L. had 14 children with three different women: six with his legal wife, four from a bigamous marriage, and four with a mistress. Bunker and Herbert were the second and third sons of H.L. and his first wife, Lyda Bunker Hunt.
After their father’s death, Bunker took over the family business. Despite initial setbacks, including losing millions in failed oil exploration projects, Bunker eventually struck gold—or rather, oil—by discovering the Sarir Field in Libya, one of the largest oil fields in the world. By the early 1970s, Bunker and Herbert had fully taken over their father’s empire, their fortune estimated at an astonishing $13 billion.

Silver Obsession

By the mid-1970s, Bunker developed an obsession with silver. Amid global inflation, instability, and fears of communism, he saw silver as a stable and undervalued investment with enormous potential. Encouraged by financial advisors, the Hunt brothers joined the Bache investment house and entered the silver market.
By the mid-1970s, the Hunts controlled nearly 10% of the world’s silver supply, driving the price of silver from $2 per ounce to over $6 per ounce. They invested their own capital and convinced others, including a group of wealthy Arab investors, to join their mission.
With their growing influence on the silver market, the Hunts’ holdings flourished. By the end of 1979, the price of silver had skyrocketed to $35 per ounce, and their strategy attracted more investors, further inflating the price. By early 1980, silver peaked at $50 per ounce—a dramatic increase from just $2 a decade earlier. At this point, Bunker believed that prices as high as $200 or $300 per ounce were within reach.

Bloody Thursday

The end, however, was near. Silver prices began to decline as investors shifted from precious metals to high-interest bank certificates. The value of gold and silver collapsed, and the Hunt brothers' fortune evaporated.
Having taken massive loans from brokers like Bache, A.G. Edwards, and Merrill Lynch to fund their silver purchases, the Hunts faced margin calls when the market crashed. These calls required them to cover their losses within five days or face liquidation.
When one broker demanded a $100 million payment—the largest margin call at the time—the Hunts could no longer meet their obligations. In a desperate bid to salvage their position, the brothers and their Arab investors attempted to create bonds backed by their 200 million ounces of silver, envisioning a silver-backed international currency. The plan failed, further exacerbating the collapse of the silver market.
On March 27, 1980, known as Bloody Thursday, silver prices hit rock bottom, and the Hunts’ financial empire crumbled.

A Nightmare Ending

What began as an ambitious plan to corner the silver market ended in financial ruin. The Hunts' dream of controlling the market turned into one of the most infamous cautionary tales in financial history, demonstrating the risks of overreliance on speculative investments.

Disclaimer: The Silver Mountain does not provide investment advice and this article should not be considered as such. Past performance is no guarantee of future results.