FYI March 27, 2018

  • Filed under FYI


 
 

Widget not in any sidebars

 
 
 
 

On This Day

1980 – Silver Thursday: A steep fall in silver prices, resulting from the Hunt Brothers attempting to corner the market in silver, leads to panic on commodity and futures exchanges.

Silver Thursday was an event that occurred in the United States in the silver commodity markets on Thursday, March 27, 1980, following the Hunt brothers’ attempt at cornering the silver market. A subsequent steep fall in silver prices led to panic on commodity and futures exchanges.

Background
Nelson Bunker Hunt and William Herbert Hunt, the sons of Texas oil billionaire Haroldson Lafayette Hunt, Jr., had for some time been attempting to corner the market in silver. In 1979, the price for silver (based on the London Fix) jumped from $6.08 per troy ounce ($0.195/g) on January 1, 1979 to a record high of $49.45 per troy ounce ($1.590/g) on January 18, 1980, which represents an increase of 713%. The brothers were estimated to hold one third of the entire world supply of silver (other than that held by governments). The situation for other prospective purchasers of silver was so dire that on March 26, 1980 the jeweller Tiffany’s took out a full page ad in The New York Times, condemning the Hunt Brothers and stating “We think it is unconscionable for anyone to hoard several billion, yes billion, dollars’ worth of silver and thus drive the price up so high that others must pay artificially high prices for articles made of silver”.[1]

But on January 7, 1980, in response to the Hunts’ accumulation, the exchange rules regarding leverage were changed, when COMEX adopted “Silver Rule 7” placing heavy restrictions on the purchase of commodities on margin. The Hunt brothers had borrowed heavily to finance their purchases, and, as the price began to fall again, dropping over 50% in just four days, they were unable to meet their obligations, causing panic in the markets.

Silver Thursday
The Hunt brothers had invested heavily in futures contracts through several brokers, including the brokerage firm Bache Halsey Stuart Shields, later Prudential-Bache Securities and Prudential Securities. When the price of silver dropped below their minimum margin requirement, they were issued a margin call for $100 million. The Hunts were unable to meet the margin call, and, with the brothers facing a potential $1.7 billion loss, the ensuing panic was felt in the financial markets in general, as well as commodities and futures. Many government officials feared that if the Hunts were unable to meet their debts, some large Wall Street brokerage firms and banks might collapse.[2]

To save the situation, a consortium of US banks provided a $1.1 billion line of credit to the brothers which allowed them to pay Bache which, in turn, survived the ordeal. The U.S. Securities and Exchange Commission (SEC) later launched an investigation into the Hunt brothers, who had failed to disclose that they in fact held a 6.5% stake in Bache.[3]
Stock market reaction

This day marked the end of a large stock market correction that year.

Aftermath
The Hunts lost over a billion dollars through this incident, but the family fortunes survived. They pledged most of their assets, including their stake in Placid Oil, as collateral for the rescue loan package they obtained. However, the value of their assets (mainly holdings in oil, sugar, and real estate) declined steadily during the 1980s, and their estimated net wealth declined from $5 billion in 1980 to less than $1 billion in 1988.[4]

In 1988, the brothers were found responsible for civil charges of conspiracy to corner the market in silver. They were ordered to pay $134 million in compensation to a Peruvian mineral company that had lost money as a result of their actions. This forced the brothers to declare bankruptcy, in one of the biggest such filings in Texas history.[5]

 
 
 
 

Born On This Day

1862 – Dorothea Fairbridge, South African author and conservationist, co-founded Guild of Loyal Women (d. 1931)

Dorothea Ann Fairbridge referred as Dora Fairbridge (27 March 1862 – 25 August 1931) was a South African author and co-founder of the Guild of Loyal Women.[2]

Biography
Fairbridge was the daughter of a distinguished lawyer, scholar and Cape Town parliamentarian, and a cousin of Kingsley Fairbridge (1885–1924; the Rhodesian poet and founder of the “Fairbridge Society”). She was educated in London and travelled widely.[2][3]

As a highly respected third generation British settler, Fairbridge was a pillar of the colonial establishment. She met with British women from the upper social classes who traveled to South Africa from Britain before and during the Second Boer War. Fairbridge was a founding member of the Guild of Loyal Women, a charitable organisation that encouraged women in South Africa and supported the British Empire and its British Empire forces engaged in conflict. The guild ensured that the relatives of dead soldiers were contacted, and that the graves were properly marked and recorded. When the guild sent members to Britain to explain what they were doing to raise money, women who had the ear of the male British establishment formed the Victoria League to promote links between organisations within the British Empire. These women induced Violet Markham, Edith Lyttelton, Violet Cecil and Margaret, Countess of Jersey all of whom had met Dorothea Fairbridge socially.[2][3]

After the Boer war, Fairbridge continued supporting South Africa to be closely integrated into the British Empire. She sought to establish the Union of South Africa with a reconciled population and a shared sense of South African history. The Union of South Africa was established within a constitutional arrangement that encouraged close ties with the rest of the British Empire.[2]

Works
Her works include:[2]
That Which Hath Been (1910) — a novel set in the early in the Cape’s history.
Piet of Italy (1913)
The Torch Bearer (1915)
History of South Africa (1917) — a school history
Historic Houses of South Africa (1922) — a study of old Cape Dutch farmsteads
Along Cape Roads (1928) — A travel guide
The Pilgrim’s Way in South Africa (1928) — a travel guide
Historic Farms of South Africa (1932) — a study of old Cape Dutch farmsteads

Fairbridge edited:[2]
Lady Anne Barnard’s Cape diaries (1924)
Lady Duff Gordon’s Letters from the Cape (1927)

Guild of Loyal Women
 
 
 
 

FYI

 
 
 
 
By Caroline John: Linda Brown Wiki: Student at the Center of “Brown v. Board of Education” Dies at 76

 
 
 
 
By George Dvorsky: Here’s What Protects Shipwrecks From Looters and Hacks
 
 
 
 
By Tom McKay: San Francisco Uber Driver Accidentally Turns Onto Pedestrian Staircase, and Down He Goes
 
 
 
 
By Tom McKay: Elon Musk Has Some Literal Rocks to Sell You, Maybe
 
 
 
 
Open Culture Josh Jones: Enter the Pulp Magazine Archive, Featuring Over 11,000 Digitized Issues of Classic Sci-Fi, Fantasy & Detective Fiction
 
 
 
 
Open Culture Dan Colman: The Models for “American Gothic” Pose in Front of the Iconic Painting (1942)
 
 
 
 
Atlas Obscura: Photographing Desolate Icelandic Landscapes, Mission: Find Tiny Owls, Victorian Flirtation and more ->
 
 
 
 
By Barnes & Noble: 50 Science Fiction Essentials Written by Women
 
 
 
 
By fixthisbuildthat: Epoxy Waterfall River Table

 
 
 
 
By Hubbards Handmade: Black Walnut Slab and Black Epoxy Coffee Table (with Cocobolo Bowties)

 
 
 
 
By mrwonton: Hot Wheels Photography 101
 
 
 
 
By Claire at Pillarboxblue Hometalker: Gorgeous Cable Spool Floor Pouf
 
 
 
 
By Hometalk Highlights: 27 spring wreath ideas that will make your neighbors smile
 
 
 
 
Home for the Harvest Organic Gardening Blog: Ultimate Seed Starting Guide: How to Grow Seeds into Healthy Plants
 
 
 
 

Widget not in any sidebars

 
 


 
 

 
 

Recipes


Widget not in any sidebars

 
 

Widget not in any sidebars

 
 

Widget not in any sidebars