Silver Thursday financial event [1980] Actions Cite verifiedCite While every effort has been made to follow citation style rules, there may be some discrepancies. Please refer to the appropriate style manual or other sources if you have any questions. Select Citation Style MLA APA Chicago Manual of Style Copy Citation Share Share Share to social media Facebook X URL https://www.britannica.com/topic/Silver-Thursday Give Feedback Feedback Corrections? Updates? Omissions? Let us know if you have suggestions to improve this article (requires login). Feedback Type Select a type (Required) Factual Correction Spelling/Grammar Correction Link Correction Additional Information Other Your Feedback Submit Feedback Thank you for your feedback Our editors will review what you’ve submitted and determine whether to revise the article.

　　Print Cite verifiedCite While every effort has been made to follow citation style rules, there may be some discrepancies. Please refer to the appropriate style manual or other sources if you have any questions. Select Citation Style MLA APA Chicago Manual of Style Copy Citation Share Share Share to social media Facebook X URL https://www.britannica.com/topic/Silver-Thursday Feedback Written by Fid Backhouse and others Fid Backhouse is one of several contributors to 501 Most Devastating Disasters. Fid Backhouse and others Fact-checked by The Editors of Encyclopaedia Britannica Encyclopaedia Britannica's editors oversee subject areas in which they have extensive knowledge, whether from years of experience gained by working on that content or via study for an advanced degree. They write new content and verify and edit content received from contributors. The Editors of Encyclopaedia Britannica Last Updated: Jul 29, 2024 • Article History Table of Contents Date: March 27, 1980 (Show more) See all related content →

　　The Hunt brothers being sworn in before a House subcommittee investigating Silver ThursdayThe billionaire Hunt brothers, William Herbert (l) and Nelson Bunker (r), are sworn in before a House subcommittee investigating the recent collapse of the silver market. Silver Thursday, the dramatic fall in the price of silver on March 27, 1980, followed the Hunt brothers' attempt to corner the market on the metal. © UPI—Bettmann/Getty Images.(more)Silver Thursday, dramatic fall in the price of silver on March 27, 1980, following an attempt to corner the market on the precious metal.

　　Apart from a handful of reigning monarchs and despots, Nelson Bunker Hunt (1926–2014) was the richest man in the world at the start of the 1960s, having inherited a fortune from his father, the legendary oilman H. L. Hunt, and earned another fortune through investments and speculation. By 1970 he foresaw a volatile economic future marked by rampant inflation. Prevented by Franklin Roosevelt’s 1933 prohibition on U.S. citizens owning gold, Bunker and his younger brother William Herbert (1929–2024) chose silver, then standing at $1.50 per ounce, as their speculative hedge. Their initial caution vanished after Colonel Muammar al-Qaddafi nationalized the Hunts’ Libyan oil fields in 1973. Concerned that paper money would soon be worthless, the Hunt brothers then bought futures contracts on 55 million ounces of silver, eventually accumulating an estimated 100 million ounces of the precious metal. Instead of selling the contracts on the commodity market, they took delivery of the bullion and chartered three Boeing 707s to air-freight it to Switzerland.

　　By 1979, they had engineered a genuine shortage of the metal. The Hunts owned $4.5 billion worth of silver, representing about 70 percent of the world supply. The price climbed until, on January 17, 1980, an ounce of silver cost $49.45. Such rampant speculation and profits triggered new government oversight, prompting the Federal Reserve to suspend trading in silver. The boom was suddenly over, but the Hunts still had to honor margin-call contracts to buy at prices over $50. The day the market plunged—Thursday, March 27—silver fell to $10.80, the metal’s biggest single collapse. Upon losing some $1.7 billion, the Hunts had become the (then) greatest debtors in financial history. Although New York banks, with the approval of the Reserve, allowed them $1.1 billion credit toward clearing their obligations, they were personally bankrupted and later convicted of illegally trying to corner the market on the precious metal; the brothers were fined $10 million each, in addition to the millions they owed to the IRS, and were banned from future trading on the commodities market. In the wake of Silver Thursday, many of the banks and trading firms that had loaned the Hunts money also found themselves in financial trouble, resulting in a secondary wave of bankruptcies and mergers.

　　New federal regulations on the commodities market followed, especially with respect to margin trading. Silver Thursday has also afforded investors an object lesson in the importance of portfolio diversification and risk management.