Hunt brothers' attempt to corner the silver market

March 27, 1980 would go down in financial history as Silver Thursday. On that day, the price of silver collapsed violently in New York, plunging below $11 an ounce after having peaked just weeks earlier at nearly $50. Behind this spectacular debacle were Nelson Bunker Hunt and his brother William Herbert Hunt, two Texas billionaires who had attempted to carry out the largest corner ever seen on a commodity market.

The Hunts: a dynasty shaped by money… and by greed

The Hunt brothers were the heirs of an extraordinary figure: Haroldson Lafayette Hunt, a self-made man who became one of the richest individuals in the United States thanks to oil. Fiercely conservative, hostile to the federal government, and convinced that wealth had no limits, he instilled in his sons one unshakable belief: a rich man is never rich enough.

Nelson Bunker, the eldest, self-taught and a gambler at heart, and William Herbert, more discreet and better educated, grew up in opulence. During the 1960s and 1970s, they built their own oil empire, particularly in Libya. But the 1969 coup by Muammar Gaddafi and the sharp increase in royalties imposed on foreign oil companies severely reduced their revenues. Added to this were global inflation and monetary instability following the end of the dollar’s convertibility into gold in 1971.

For Nelson Bunker Hunt, pessimistic and deeply suspicious of the U.S. government, these upheavals signaled the decline of the dollar and the prospect of runaway inflation. He needed a safe haven.

Why silver and not gold?

Gold would have been the natural choice, but U.S. law at the time prohibited private individuals from freely owning large quantities of gold. Silver appeared to be the ideal alternative: undervalued, indispensable to industry, and produced in quantities insufficient to meet global demand.

Influenced by anti-statist monetary theories, Nelson Bunker Hunt became convinced that silver was the best possible investment. Beginning in 1973, the Hunt brothers started buying massive amounts of physical silver. By 1974, they already controlled tens of millions of ounces, largely stored in Switzerland and transported by aircraft and heavily armed convoys.

What initially began as a hedge against inflation gradually turned into a far more ambitious plan: to control the global silver market and dictate its price.

The mechanics of the silver market corner

A corner consists of accumulating enough of a commodity to force sellers to buy back their positions at ever-higher prices. The Hunt brothers did not limit themselves to the physical market; they also invested heavily in futures contracts, multiplying long positions.

Between 1973 and 1979, the price of silver rose from around $2 to more than $5 an ounce. To push the operation further, the Hunts needed additional capital. After several failed attempts, they finally succeeded in attracting Saudi investors in 1979, together forming the International Metal Investment Group.

Within just a few months, the consortium acquired more than 150 million additional ounces of silver. At its peak, the group controlled nearly half—and by some estimates up to 80%—of the world’s available silver supply.

Prices soared: $10 an ounce in the summer of 1979, over $30 in January 1980, and nearly $50 just days later. On paper, the Hunts’ fortune became colossal. They even floated the idea of reintroducing silver as money, replacing paper currency.

Regulatory intervention and the end of the game

This explosive rise alarmed regulators. The Commodity Futures Trading Commission (CFTC), COMEX, and the Federal Reserve (Fed) feared a chain reaction capable of destabilizing financial markets and the banking system.

In early 1980, the rules were abruptly changed:

• margin requirements on futures contracts were sharply increased;
• the number of contracts any single actor could hold was limited;
• sellers were allowed to settle contracts in cash instead of physical metal.

The house of cards collapsed. Unable to meet margin calls, the Hunts were forced to borrow ever more money as silver prices fell. On March 27, 1980—Silver Thursday—the price plunged to $10.80 an ounce. Hundreds of speculators were wiped out.

The Hunts threatened to drag down several major banks with them. To prevent a systemic collapse, an historic emergency loan was negotiated, allowing them to avoid immediate bankruptcy — but only at the cost of liquidating all their positions and mortgaging their assets.

Collapse, trials, and legacy

The Hunt brothers denounced a conspiracy and an arbitrary change in the rules of the game. But the U.S. courts ruled otherwise: their strategy constituted market manipulation. In 1988, they were convicted. Their financial empire was shattered, further weakened by the collapse of oil prices in the early 1980s.

The ruin was relative. The Hunt family retained oil assets, and William Herbert Hunt would even recover immense wealth decades later. Nevertheless, the silver corner remains a textbook case.

The Hunt affair: a timeless lesson

The Hunt affair illustrates the dangers of excessive speculation, leverage, and the belief that a market can be permanently dominated by a handful of players—even immensely wealthy ones. It also underscores a fundamental truth: when private interests threaten the stability of the financial system, authorities will ultimately intervene.

As William Herbert Hunt later summed up with belated clarity:

“Everyone gets lucky one day… and not the next.”

Silver Thursday thus remains one of the most striking symbols of financial hubris and its consequences.