| Author |
 Topic  |
|
|
Nickelless
Administrator
USA
5580 Posts |
 Posted - 10/12/2008 : 15:00:39
|
|
I'm just starting to delve into a bit of research for my own curiosity, but what I got to wondering is, did the Hunt Brothers actually take possession of 200 million ounces of silver in various locations, or did they just have that much in paper silver? It wouldn't seem like it would be a big deal if they had the silver itself, unless they planned to buy it up, flood the market with it and then buy it back at rock-bottom prices. Anyone here well-versed on that bit of PM history?
|
Visit my new preparedness site: Preparedness.cc/SurvivalPrep.net
--Latest article: Stocking up on spices to keep food preps lively
---------------
Be prepared...and prepared to help: http://www.survivalblog.com/charity.html
Are you ready spiritually for hard times? http://www.jesusfreak.com/rapture.asp |
|
|
Ardent Listener
Administrator
USA
4841 Posts |
Posted - 10/12/2008 : 15:03:59
|
You must be logged in to see this link.
Cornering the market
From Wikipedia, the free encyclopedia
Jump to: navigation, search
In finance, to corner the market is to purchase enough of a particular commodity to allow the price to be manipulated, whether undertaken by an individual or a company. (In general business usage, a company described as having "cornered the market" has a very high market share.) This can be done through several mechanisms, for example buying futures contracts on a commodity then selling them at a profit after inflating the price. In attempting to corner a market, the term "stockpile" is used as a verb: to stockpile something is to hoard, or retain a quantity of a given commodity. In this context, "stockpile" can also refer to the hoarded commodity in its collective sense, regardless of its location (money in a bank, oil traveling through pipelines or refineries for example).
Cornering the market has a long and checkered history. Although there have been many attempts to corner markets in everything from tin to cattle, to date very few of these attempts have ever succeeded. The party attempting to corner a market can become very vulnerable due to the size of their position, especially if this becomes widely known. If the rest of the market senses weakness it may resist any attempt to artificially drive the market any further by actively taking opposing positions. When the price starts to move against the cornering party they are in a very difficult position as it is likely to be impossible to exit much of their position without catastrophically moving prices against themselves. In such a circumstance many other parties will be able to profit from the cornerer's need to unwind their position.
An example occurred in the late 1970s and early 80s when brothers Nelson Bunker Hunt and Herbert Hunt attempted to corner the world silver markets, at one stage holding the rights to more than half the world's deliverable silver.[1] During Hunt's accumulation of the precious metal silver prices rose from $11 an ounce in September 1979 to $50 an ounce in January 1980.[2] Silver prices ultimately collapsed to below $11 an ounce two months later,[2] much of the fall on a single day now known as Silver Thursday.[3]
More recently rogue trader Yasuo Hamanaka, Sumitomo Corporation's chief copper trader, attempted to corner the international copper market over a ten year period leading up to 1996.[4] At one point Hamanaka is believed to have controlled approximately 5% of the world copper market.[4] As his scheme collapsed Sumitomo was left with large positions in the copper market, ultimately losing US$2.6 billion.[5] In 1997 Hamanaka pleaded guilty to criminal charges stemming from his trading activity and was sentenced to an eight year prison sentence.[5] On June 28, 2006, the Commodity Futures Trading Commission filed papers indicating its belief that BP traders illegally cornered the U.S. propane market.[6] The CFTC and the Department of Justice later agreed to allow BP to pay a fine of more than $300 million in return for dropping the civil suit and the criminal investigation.[7]
|
Realcent.forumco.com disclosure. Please read.
All posts either by the members, moderators, and the administration of http://realcent.forumco.com are for your edification and amusement only. It is not the intent of realcent.forumco.com or its host to provide investment, medical, matrimonial, legal, security or tax advice and nothing posted here should be considered to be so. All rights reserved.
Think positive. |
 |
|
|
Nickelless
Administrator
USA
5580 Posts |
|
|
Ardent Listener
Administrator
USA
4841 Posts |
Posted - 10/12/2008 : 17:15:53
|
quote:
Originally posted by Nickelless
According to the first paragraph on this page:
You must be logged in to see this link.
It was still illegal for private citizens to own gold in 1973. When was that prohibition lifted and under what circumstances?
The limitation on gold ownership in the U.S. was repealed after President Gerald Ford signed a bill legalizing private ownership of gold coins, bars and certificates by an act of Congress codified in Pub.L. 93-373 [1] [2] which went into effect December 31, 1974. P.L. 93-373 does not repeal the Gold Clause Resolution of 1933, which makes unlawful any contracts which specify payment in a fixed amount of money or a fixed amount of gold. That is, contracts are unenforceable if they use gold monetarily rather than as a commodity of trade.[/
You must be logged in to see this link. |
Realcent.forumco.com disclosure. Please read.
All posts either by the members, moderators, and the administration of http://realcent.forumco.com are for your edification and amusement only. It is not the intent of realcent.forumco.com or its host to provide investment, medical, matrimonial, legal, security or tax advice and nothing posted here should be considered to be so. All rights reserved.
Think positive. |
|
|
|
jadedragon
Administrator
Canada
3788 Posts |
Posted - 10/12/2008 : 18:30:00
|
In the pre-1933 exit from the gold standard it was quite common to set leases at a price in gold. Some of the leases were ground leases under buildings and very long (99 years for example). Several cases are exploring this issue now. Here is an example.
You must be logged in to see this link.
This case cites a number of cases that deal with Gold clauses:
You must be logged in to see this link.
"On June 5, 1933, the United States Congress adopted a joint resolution that made unenforceable all obligations requiring payment in gold;(1) however, in 1977, the 1933 Congressional resolution was amended making obligations requiring payment in gold enforceable if issued after October 27, 1977.(2)" It goes on to discuss ways that pre-1933 clauses can become enforceable.
|
“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.” – George Bernard Shaw.
Why Copper Bullion ~~~ Interview with Silver Bullion Producer Market Harmony
Passive Income blog |
|
|
|
Delawhere Jack
1000+ Penny Miser Member
USA
1680 Posts |
Posted - 10/12/2008 : 20:20:06
|
They held a lot of physical, much of it, for some time anyway, very close to me in Wilmington DE. I remember my brother scheming how many tanker trucks, full of what type of acid, fed into the spinkler system it would take to dissolve it, and how to recover it from the sewer system....
You must be logged in to see this link.
Someday he'll learn, crime doesn't pay.  |
"Educate and inform the whole mass of the people... They are the only sure reliance for the preservation of our liberty." Thomas Jefferson
|
|
|
|
Ardent Listener
Administrator
USA
4841 Posts |
Posted - 10/13/2008 : 19:27:31
|
quote:
Originally posted by Delawhere Jack
They held a lot of physical, much of it, for some time anyway, very close to me in Wilmington DE. I remember my brother scheming how many tanker trucks, full of what type of acid, fed into the spinkler system it would take to dissolve it, and how to recover it from the sewer system....
You must be logged in to see this link.
Someday he'll learn, crime doesn't pay.
That kind of reminds me of an old Mission Impossible episode where they drilled up into the bottom of a gold vault, melted the gold, and then painted the floor to cover over the little gold left that didn't drain down.
|
Realcent.forumco.com disclosure. Please read.
All posts either by the members, moderators, and the administration of http://realcent.forumco.com are for your edification and amusement only. It is not the intent of realcent.forumco.com or its host to provide investment, medical, matrimonial, legal, security or tax advice and nothing posted here should be considered to be so. All rights reserved.
Think positive. |
|
|
|
Delawhere Jack
1000+ Penny Miser Member
USA
1680 Posts |
Posted - 10/13/2008 : 20:58:29
|
| That's probably where he got the idea. Or from a Speed Racer cartoon episode that followed the same theme.... |
"Educate and inform the whole mass of the people... They are the only sure reliance for the preservation of our liberty." Thomas Jefferson
|
|
|
|
Lemon Thrower
1000+ Penny Miser Member
USA
1588 Posts |
Posted - 10/14/2008 : 05:23:27
|
that sure beats sorting coppers.
here is a long but fascinating history of the Hunts - much better than the wikipedia entry. Long story short, they took delivery of tons of silver, both in the U.S. and Switzerland, but they were also leveraged long and the government changed the margin rules in the middle of the game and they went bust.
You must be logged in to see this link. |
Buying:
Peace/Morgan G+ at $15.00
copper cents at 1.3X
wheat pennies at 3X
|
|
|
|
NotABigDeal
1000+ Penny Miser Member
USA
3890 Posts |
Posted - 10/14/2008 : 06:12:38
|
Government cheated them. Change the rules in the middle of the game....
Deal |
Live free or die.
Plain and simple.
"If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your council or your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen."
- Samuel Adams |
|
|
|
Ardent Listener
Administrator
USA
4841 Posts |
Posted - 10/14/2008 : 06:59:31
|
| Back to the Hunts, I like this quote, "collapsed to below $11". What cost $11.00 in 1980 would cost $27.34 in 2007. So silver at $11.00 today (offical spot price) is really far lower adjusted for inflation than what it was after it had its largest collapse in history. Just think about that for a while. |
Realcent.forumco.com disclosure. Please read.
All posts either by the members, moderators, and the administration of http://realcent.forumco.com are for your edification and amusement only. It is not the intent of realcent.forumco.com or its host to provide investment, medical, matrimonial, legal, security or tax advice and nothing posted here should be considered to be so. All rights reserved.
Think positive. |
|
|
|
Computer Jones
1000+ Penny Miser Member
USA
1112 Posts |
Posted - 10/14/2008 : 22:16:32
|
Silver as been manipulated for quite some time.
I think we just might be lucky enough to see the correction that has been a long time coming.
16:1 just has to make a comeback!
Buy Ag while you can, there's only so much left above the ground and what's still buried is a lot harder to get. |
There's profit if you melt things!!
8{> |
|
|
| |
Topic |
|
|
|
Question about the Hunt Bros. cornering Ag market
Forum Locked
