Meanwhile: The silver corner that ended in collapse

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Meanwhile: The silver corner that ended in collapse

Published: 05 Feb. 2026, 00:05

Audio report: written by reporters, read by AI

Kim Sung-jae

The author is a professor of business administration at Furman University and author of “The Story of Tariffs” (2025).

On March 26, 1980, the luxury jeweler Tiffany placed an unusual advertisement in The New York Times. It accused an unnamed actor of hoarding silver, a precious metal, and driving up the prices of baby spoons and teaspoons, harming ordinary consumers. The ad was striking not only for its tone but for the fact that a venerable retailer was publicly condemning market manipulation.

Wall Street already knew who Tiffany was referring to. The culprits were the Hunt brothers, who had amassed vast quantities of silver and reaped astronomical profits. After oil tycoon H.L. Hunt died in 1974, two of his sons inherited a large fortune and turned aggressively to silver.

Silver bars are pictured in Silver Bullion's vault in Singapore on June 18, 2019. [REUTERS/YONHAP]

Their bet was rooted in macroeconomic anxiety. When President Richard Nixon ended the gold standard in 1971, the brothers predicted a collapse in the dollar’s value. The oil shock sent crude prices soaring and inflation into double digits, reinforcing their conviction. Silver, they believed, offered protection against the erosion of paper money.

Silver had only recently begun trading freely as a commodity. In 1965, the U.S. government stopped minting silver coins. Until then, it had capped the price of silver used for coinage at $1.29 an ounce. Rising industrial demand, including from photographic film, pushed intrinsic value above the official price, and melting coins for bullion became common. By 1974, silver had surpassed $5 an ounce.

Even the legendary investor Warren Buffett recognized the imbalance between supply and demand and accumulated silver in the late 1960s, earning several times his investment. The Hunt brothers went much further. Pooling family capital, they bought roughly 100 million ounces, about half of all privately held silver worldwide, and aggressively added futures contracts. By 1980, their total silver position reached $4.5 billion. Much of it was leveraged with borrowed funds. Of that sum, only about $1 billion was their own money. Their long futures positions accounted for 69 percent of all silver contracts on the New York Commodities Exchange, giving them effective control over price direction. In January 1980, silver peaked at $48 an ounce, several times its earlier levels.

The day after Tiffany’s advertisement ran, exchanges announced new restrictions on silver futures. Only liquidation of existing positions was allowed, while new purchases were banned, and margin requirements were sharply raised.

The shock sent silver plunging to $11 an ounce. In a single Thursday, half its value vanished. The Hunt brothers lost $1.7 billion. Buffett, who had invested on fundamentals, exited with gains. The Hunts, focused only on price momentum, were ruined. The episode is old, but its lesson remains timely.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.