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U.S. ASSAY OFFICE SILVER
The Hunt Brothers and the Silver Saga.
Some of you have asked about the U.S. Assayer Bars and Rounds that went out in some of Investor Crates's very own, Generic Silver and Big Bar Crates. These vintage bars and rounds have quite the story behind them so even if you decide to sell out, hang on to these! To explain the story behind them, let us get familiar with “Silver Thursday,” the Silver saga that put Silver on the map.
In 1979, Silver traded at about $6 per troy ounce, a few years before this time the infamous Hunt Brothers decided to buy as much Silver as they possibly could. There initial decision to do this was to hedge their money against inflation. They chose Silver because Gold was still illegal for private ownership following the 1933 ban on private ownership of Gold by the U.S. Government. That’s right and as they say, if the Government doesn’t want you to have it, stock up on it!
Now, when ordinary folks like us decide to buy Silver, we might allocate a small percentage of our paycheck per month on some of the shiny goodness. Maybe even set up a recurring $200 or so Silver Crate a month from your favorite bullion dealer. But when the Hunt Bros decided to buy Silver, they bought an estimated 1/3 of the entire available world supply. They were, after all, the sons of Haroldson Lafayette Hunt, an East Texas oil tycoon worth an estimated 5 billion dollars!
MARKET MANIPULATION IS UNCONSCIONABLE!
From the time the 3 brothers, Nelson, Lamar, and William Hunt made their purchase in January of 1979, Silver would see an increase of 713% just a year later. Talk about buying at the perfect time! This, however, caused absolute panic in the commodity market and big annual buyers felt the pinch. This, as you could imagine, spread to many industries due to Silvers' wide range of uses. Tiffany & Co even took out a front-page advertisement in the New York Times condemning the actions of the Hunt Family.
A few days of this madness and COMEX, the Commodity Exchange Corporation, placed regulation dubbed ‘Silver Rule 7’ that restricted activities such as buying on a margin as the Hunt Brothers did. In a few short days, the artificially inflated price of Silver began to free fall, faster than the Hunt Brothers could sell-off. The flaw in the Hunt Brothers plan was that they borrowed heavily to finance the purchase of the Silver and with the market dropping over 50% in a few days, caused them to default and become unable to meet their loan obligations. I don’t think anyone hardly feels bad for the Hunt Brothers, but all told, they lost nearly $1.7 Billion’ worth of their family's wealth and were forced to pay a 137 million dollar fine to a Peruvian Mining Company. This was because not all of the Silver they had purchased was physical, some were in the form of securities and futures.
New York Times advertisement paid for by Tiffany & Co., the famous and well-known Jewelry company. March 26th, 1980.
Wait a minute… What does this have to do with the Silver I received this month?
Note the date on the bullion that reads, “MINTED FROM U.S. STRATEGIC STOCKPILE SILVER FORMERLY STORED AT U.S. ASSAY OFFICE SAN FRANCISCO CC.” That’s right, 1981. Now, although the market had dropped to over 50% of its peak, it still had a ways to go before it leveled out. The U.S. Government, under the Carter administration, with this Silver Fiasco in mind and the end of Silver in circulatory coinage, meant the diminished need for the United States Assay Commission. Therefore, it was abolished in March of 1980 and all of its Silver Stockpile was auctioned off. This conveniently served the purpose of driving the Silver prices back down to their appropriate, ‘inflation following’ prices.
A company by the name of “Continental Coin & Jewelry Company” based in Van Nuys, California (mintmark CC) bought a large amount of that Silver and produced the bullion in question. Commonly mistaken for U.S. Mint or otherwise officially authorized by the U.S. Treasury or Government bullion, this private company produced both Silver Rounds and Silver Bars from the Silver they purchased. All of the Silver is .999 in purity, and the back reads “SILVER TRADE UNIT” with weight in ounces and/or grams as well as metal type and purity.
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HERE ARE THE DIFFERENT VARIANTS
This specimen was produced in one troy ounce (31.1 grams) round form. The rounds came in two variants TYPE 1 (shown) and TYPE 2 (not shown). The difference being the Eagle on the obverse, TYPE 1 displays the Eagle preparing to land, whereas, TYPE 2 displays the Eagle preparing to fly away.
This specimen was produced in one troy ounce (31.1 grams) bar form. The 1 oz Silver Bar also came in two variants TYPE 1 (shown) and TYPE 2 (not shown). The difference being the lettering, with TYPE 1 variants having ‘skinny’ lettering and TYPE 2 having ‘fat’ lettering. The annotation of 1 is always spelled out as ‘one.’
This specimen was produced in five troy ounce bar variants. The 5 oz Silver Bar came in two variants, TYPE 1 (shown) with annotation of 5 being in numeric form and the letters being ‘skinny.’ TYPE 2 (not shown) had the word ‘FIVE’ spelled out and the font was ‘fat.’
This specimen came in 10 oz bar variants. Similarly, to the 5 oz version, it to come in TYPE 1 (not shown) and TYPE 2 (shown) forms. TYPE 1 had skinny lettering and the number ’10,’ whereas, TYPE 2 has the word ‘TEN’ and is minted with ‘fat’ lettering.
This beautiful specimen is the 100 oz bar version. It unofficially came in two different formats, TYPE 1 (shown) as a pressed, solid bar. TYPE 2 (not shown) came in a hammered ‘hand-poured’ look, however, we can not confirm the manufacturing process of TYPE 2 variants.
Before the purchase of the Silver by the Continental Coin Company, the Silver was originally acquired from the turn-in of Silver Certificates during the run on the Banks in 1933. There is a rumor some of the Silver was loaned to a fake ‘shell’ corporation set up by the U.S., Skunkworks type, Government Agency. The Silver was then used in Los Alamos during the time of the controversial Manhattan Project for research and weapons development, later being returned. Though, these are rumors and largely unfounded.
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The story was quite interesting. This, having a backstory, does this make them a collector’s item ? Or are they just worth what the silver in it is ?!
This was a very helpful article! I recently purchased 35 various ten oz bars and 140 silver rounds (from a retired private seller) all from the early 80’s and upon doing my research found this article and explained the different types that I have on some of them and the history behind the making of them. Thank you!
Great article. My dad bought 16 of the Ten ounce bars back in 81 or 82 and still has them to this day.
Interesting information and I like the looks of the bars.
I love the detail you write in explaining these bullion pieces, thank you!