Bad News Day for the Rich
Nelson Bunker Hunt has passed away and was briefly a candidate for the title of the world’s richest man. He owned vast acreages of oil and ranchland around the globe, as well as the Circle T Ranch, 30 miles outside Dallas. For some, Nelson was JR Ewing of the eponymous TV series made flesh. He was a dyed-in-the-wool conservative who loathed communism and the federal government in equal measure. He was a council member of the radical right-wing John Birch Society. He was also a certified Bible Belt, evangelist Christian, whose positions included chairman of the Texas Bible Society and head of the Campus Crusade for Christ International.
Then came a disaster beside which even the loss of the Libyan interest paled. In the early 70s the brothers began to amass vast quantities of silver futures, at first ostensibly as a hedge. But by the end of the decade the buying had turned into a bid to corner the world market in silver whose price, following that of gold, soared in early 1980 to more than $50 an ounce. By some estimates the Hunts controlled up to half the world’s deliverable silver, worth more than $7bn. But on 27 March 1980 – a date that has gone down in the annals of market disasters as “Silver Thursday” – the speculative edifice collapsed, and with it most of the Hunts’ money. The Federal Reserve had drastically raised interest rates to fight inflation and the silver bubble burst. That day the Hunts failed to meet various margin calls, and a $7bn paper asset turned into a $1.7bn debt. Fines, claims and lawsuits consumed much of the Hunts’ remaining wealth. The choicest family assets were sold and Nelson Bunker was eventually forced to file for bankruptcy, emerging in 1989 reportedly with a bare $10m to his name. [still not exactly a pauper, though, SOYMB]
But even without Nelson Bunker, the epic story of the Hunts continues – indeed, it may be said to have come full circle. Oil made the family fortune in the first place, and now oil is resurrecting that fortune. In 2012, William Herbert Hunt sold his company’s stake in the Bakken Field for $1.45bn, lifting his net wealth to an estimated $3bn or more. For the first time in a quarter-century, a Hunt, now aged 84, is back on the lists of America’s richest men.
Meanwhile, we should shed a tear for Warren Buffet, presently the third richest man in the world. Having last week confessed a bad investment decision in putting money into Tesco which has seen its share price more than halve in the past 12 months following a series of profit warnings.his bet on Coca-Cola and American tech giant IBM have cost him more than $2 billion in just three days.
On Monday, Buffett lost nearly $1 billion after shares in IBM plummeted to a three-year low after it badly missed third-quarter earnings estimates and announced it would pay $1.5 billion to ditch its loss-making chip division. That’s bad news for Buffett considering his investment firm, Berkshire Hathaway, is the largest investor in IBM. Yesterday, another vehicle for Buffets capitalism, Coca-Cola, saw its shares plummet six per cent in New York trading after it reported flat sales and lowered its guidance for the year.
SOYMB hope he loses the lot. Are we supposed to have sympathy for this leech who makes money off the backs of the workers without ever lifting a finger?
Nelson Bunker Hunt has passed away and was briefly a candidate for the title of the world’s richest man. He owned vast acreages of oil and ranchland around the globe, as well as the Circle T Ranch, 30 miles outside Dallas. For some, Nelson was JR Ewing of the eponymous TV series made flesh. He was a dyed-in-the-wool conservative who loathed communism and the federal government in equal measure. He was a council member of the radical right-wing John Birch Society. He was also a certified Bible Belt, evangelist Christian, whose positions included chairman of the Texas Bible Society and head of the Campus Crusade for Christ International.
Then came a disaster beside which even the loss of the Libyan interest paled. In the early 70s the brothers began to amass vast quantities of silver futures, at first ostensibly as a hedge. But by the end of the decade the buying had turned into a bid to corner the world market in silver whose price, following that of gold, soared in early 1980 to more than $50 an ounce. By some estimates the Hunts controlled up to half the world’s deliverable silver, worth more than $7bn. But on 27 March 1980 – a date that has gone down in the annals of market disasters as “Silver Thursday” – the speculative edifice collapsed, and with it most of the Hunts’ money. The Federal Reserve had drastically raised interest rates to fight inflation and the silver bubble burst. That day the Hunts failed to meet various margin calls, and a $7bn paper asset turned into a $1.7bn debt. Fines, claims and lawsuits consumed much of the Hunts’ remaining wealth. The choicest family assets were sold and Nelson Bunker was eventually forced to file for bankruptcy, emerging in 1989 reportedly with a bare $10m to his name. [still not exactly a pauper, though, SOYMB]
But even without Nelson Bunker, the epic story of the Hunts continues – indeed, it may be said to have come full circle. Oil made the family fortune in the first place, and now oil is resurrecting that fortune. In 2012, William Herbert Hunt sold his company’s stake in the Bakken Field for $1.45bn, lifting his net wealth to an estimated $3bn or more. For the first time in a quarter-century, a Hunt, now aged 84, is back on the lists of America’s richest men.
Meanwhile, we should shed a tear for Warren Buffet, presently the third richest man in the world. Having last week confessed a bad investment decision in putting money into Tesco which has seen its share price more than halve in the past 12 months following a series of profit warnings.his bet on Coca-Cola and American tech giant IBM have cost him more than $2 billion in just three days.
On Monday, Buffett lost nearly $1 billion after shares in IBM plummeted to a three-year low after it badly missed third-quarter earnings estimates and announced it would pay $1.5 billion to ditch its loss-making chip division. That’s bad news for Buffett considering his investment firm, Berkshire Hathaway, is the largest investor in IBM. Yesterday, another vehicle for Buffets capitalism, Coca-Cola, saw its shares plummet six per cent in New York trading after it reported flat sales and lowered its guidance for the year.
SOYMB hope he loses the lot. Are we supposed to have sympathy for this leech who makes money off the backs of the workers without ever lifting a finger?
No comments:
Post a Comment