As the Hunt brothers continued to take deliveries of silver, they generated billions of dollars in silver demand which inflated silver’s value to more than fifty dollars per ounce. The siblings even borrowed against their solid reputation to take out more futures, at lower interest rates than most investors could obtain. Simultaneously, they were able to convince others to invest in preparation for the coming devaluation of the dollar.
As the brother’s short silver position ballooned to four and one-half billion, others wanting to take advantage of high silver prices raced to sell their physical silver assets. By this time, less than one-third of the silver market remained beyond the Hunt’s control.
The Federal Reserve, seeing what was happening, began to discourage banks from speculative lending. Silver began to drop as fear that the Hunts wouldn’t be able to meet margin calls began to spread. The first missed margin call came on March 27, 1980. The Hunt’s retained much of their wealth, even after being fined and forced into bankruptcy to satisfy creditors.
http://investopedia.com/articles/optioninvestor/09/silver-thursday-hunt-brothers.asp#axzz1tBzokqc1
