The world has its fair share of gold bugs who are obsessed with gold and always looking to buy gold and expand their investment portfolios. Silver has also had its own fair share of big spender, people who have amassed tons of silver physically or in the form of futures contracts. Let’s look at three of the most prominent silver market players buyers who controlled vast amounts of silver bullion, these players were known to buy silver bullion and hoard it until there was not any silver bullion available in the market.
#3) Hunt Brothers
William, Nelson and Lamar Hunt, three sons of a wealthy oil tycoon amassed over 100 million ounces of silver between 1971 and 1980. Not only did the brothers amass the largest hoard of silver but they also leveraged tens and thousands of futures contracts on the COMEX. It is estimated that at their peak, the brothers’ exposure in the silver market was at 200 million ounces. During the second half of 1979 to the early 80s, oil prices quadrupled, platinum prices tripled and the price of gold short up from $200 to $850 an ounce. Around this time, silver prices also rose from $5 to $50 an ounce. However after January 1980, the silver price took a dive causing the Hunts margin calls of more than $100 million. The brother’s had loaned so much from so many banks and this massive loss prompted the Federal Reserve to guide a $1 billion bailout. The Hunt might have been trying to corner the silver market but failed dismally.
Because of the Hunt Brothers, Tiffany’s and Co had to close it silver jewellery department. They registered their anger by taking out a ad on the New York Times fanning the flames of insider trading and price manipulation that had been dogging the Hunts.
As to whether the Hunts were doing something illegal, has never been proven. Industry experts believe that the Hunts may have been used as scapegoats for flawed government policies and the backfiring of the scrapping of the Bretton Woods agreement and the inflation o the 70s. The Hunt Brothers gambled on the COMEX and lost, maybe they were greedy, foolish or the game was changed on them for the market to be able to deal with liquidation orders. This did not affect the actions of people who still wanted to buy silver bullion. People learnt how volatile the silver market was and how hard it would be for one entity to corner the market.
2) Warren Buffett
Often referred to as the “Oracle of Omaha” and The “Wealthiest Man in the World”, Warren Buffet who is the Chairman of Berkshire Hathaway was reported to have bought a massive amount of silver around 1997 to 1998.
The Company announced that it bought 129,710, 000 ounces of silver on the 25th July 1997 and 87,510,000 ounces of silver on the 12th January 1998. Apparently, the company invested in silver in anticipation of the US government’s demonetization of the metal. In the spring of 2006, Buffett and Berkshire Hathaway made an announcement that they had sold all their silver. In the 9 year span, they may have doubled their investment value. This could be seen as an endorsement by one Buffet that silver was a worthy metal to invest in.
#1) USA Government
Just before its involvement in World War II, the U.S government amassed 3,334,000,000 ounces!
The amount of silver the U.S hoarded peaked when the US army was hearing up for World War 2 and then increased when the US went to war in Korea and Vietnam. In the late 1960s The US stopped make ng silver coins as currency and began stockpiling it for the military and later on began coining the American Silver Eagle Coin program.