The Galveston Daily News from Galveston, Texas • Page 14

14" A iNctua Sunday Morning, September 7, 1980 ByMARYTOBIN UPI Butuiess Writer DALLAS (UPI) It's hard to reconcile the look and manner of William Herbert Hunt with the image of a family that wants to take over the world's supply of silver, And, listening to him In his 25lh floor office at Hunt Energy Corp. In Dallas, one can believe that neither Herbert Hunt nor his more flamboyant brother, Nelson Bunker Hunt, wanted to corner the market. "If I had wanted to I wouldn't have been rolling forward. I wouldn't have exchanged my futures for silver that wasn't available," Hunt said. He referred to the latest Hunt adventure speculation in sliver futures.

The brothers' Inability to meet millions of dollars of margin calls led to what has been dubbed "Silver Thursday," a day of crisis in the financial system that still Is being investigated by Congress and regulatory bodies. Hunt, member of a fabled family that always has valued its privacy, agreed to an Interview after months of generally shunning thei press because "we want to 1 clear up a lot of misinformation that's being printed." "We're not a public company with shareholders to account to," Hunt said, "but we owe an awful lot to our employees (he estimates about 8,000 Hunt believes government's influence too big worldwide), to our customers, and to our families, and they get upset at some of the things they read." Hunt laughed when asked If, as one story has it, he and Bunker wanted to set up their own economy, using silver as a currency. "Bunker and I share common views about the paper dollar losing its value because of inflation," Hunt said. Their investments in sliver were a hedge, a "store of value," he said. "We believe in living within the law of the land but we do think there are too many unnecessary laws," he said.

Herbert Hunt, and by inference his brothers Bunker and Lamar, believes the "only legitimate function of government is to protect us from outside attack and to protect us from bodily harm." "Basically I believe the government literally can be run by the Constitution and the Bill of Rights," Hunt said. "We don't need any other laws." Hunt calls himself a believer In "private enterprise free enterprise implies that you get something without working for it." This philosophy could be the reason the Hunts have found, and may continue to find, themselves at loggerheads with the regulatory authorities and the public. By most accounts the Hunts are tough businessmen, but think in the style of the Idealized Old West. They consider their word or a handshake on a deal final. But the Old West is gone and a "Bronco Billy" or "Tom Mix" is at odds in today's world.

And when It comes to an oft-repeated lale of Hunt cowboys riding shotgun on the midnight air transfer of 40 million ounces of Hunt silver to Switzerland, it's a colorful story in the tradition of the old west, but it's just that, according to Hunt. "It simply is not true. We have never sent silver to Switzerland, "he said, "In 1979, we had to make delivery on 6 million ounces of silver in London, but it went by regular channels and there was no intrigue about it." Hunt attributes this story, "and much of the misinformation that has been printed," to Bill Bledsoe, a former employee whom the Hunts are suing, alleging among other things that he diverted company funds to his own use. Although Hunt would not comment on Bledsoe's claim that the brothers harass former employees, his secretary of 18 years, Marge Johnson, dismissed it. "They're too busy to bother with such things," she said with a wave of her arm.

"I don't know of anything like that and I think I would have known if it was so." Indeed, talks with Hunt Energy employees, from vice presidents to Mrs, Johnson and Bunker's secretary Lois Snow, to young Roger Layne who is in charge of the stock room, brought continued references to "family." "We celebrate birthdays, we get involved in each other's personal affairs. Working for the Hunts is kind of like being part of the family," Layne said. "Mr. Bunker, Mr. Herbert and Mr.

Lamar are never too busy to talk to any employee, no matter how new or how far down on the totem pole." Often-printed comments that the Hunts' harbor racial and ethnic prejudices also upset Hunt. "This goes against all my beliefs as a Christian," said Hunt. "You can't hate anyone if you profess to be Christian." Hunt is an active member of the Highland Park Presbyterian Church of Dallas and in a recent talk there, said to laughter that while he has trd I'm sure all of you here have read all about them." Why did the Hunts invest in silver instead of gold, oilust.rial uses that silver does," Hunt said. "Consumption (of silver) has outstripped production for several years running and we knew the price had'to go up." Silver also has strategic uses in submarines and sophisticated missiles, for instance. It has been suggested this, too.

could UPI Wlrcphoto Herbert Hunt talks about family adventures in silver market Federal control of money seen lacking FORT LAUDERDALE, Fla. (UPI) The federal government "has lost control" over the consumer money supply because, says Peter Halmos, of the billions available to Americans through credit cards. Halmos can envision a deep recession turned into instant prosperity if the nation's 100 million credit card holders to spend the third of a trillion dollar limit of their cards' borrowing capability in a single week. Or imagine that the government somehow managed to bring inflation under control, only to see its efforts fal) apart under an onslaught of demand created by overnight credit card buying. "Only the federal government has the authority to mint or print currency," Halmos said.

"However, the use of hundreds of millions of credit cards and the preexisting credit value of those cards is so awsome the federal governnment has lost its harness on the money supply." Halmos' figures show 579 million credit cards in the hands of 100 million Americans in 1978. By 1985, his projections show, there will be 700 million cards used by 118 million Americans. There were only 712 million credit cards worldwide in 1978, meaning 80 percent of the all cards were held in the United States. The Galveston Islander Swim Team wishes to thank the following companies for their generous donations made to our swimmers in the recent Swim-a-lap. The proceeds go towards equipment and general club expenses.

Guaranty Federal and Loan First Hutchlngt Sealy Bank Moody National Bank Unlvanlty National Bank Bankers Saving! and Loan Bankof the Wast Alert Alarmt Homacut Oanuts BAHCIeanars University Pat Shop U.t. National Bank Village Hardware Bank of Oolvoston Pagan 1 ord American Indemnity The Strand Emporium Vic's Jewelry Slora Druss Furniture Moody National lank Barnard Spltzer Kelso Industries Inc. Oalvallon Ship Building Co. Kyle Olllasple Motor. Island City Iron Butch Miller Realtor Oalvaston Concrete Co.

JutaiLauva, Jr. Inc. Outdoor Advertising Flood ICalvert. Inc. la Kings Confectionery Travel Councillors Inc.

Dr. Russell Bornett Simpson Shoos Fettlj Office Supplies Hills Pier It Bob's Exxon McNIer's Net Shop Shrlmp'n Stuff StltchlnPost Booh Beg Del Pepe Distributing A. W. Oulnn Distributing Hone'loy Market Schrelber A Miller Furniture lllendT.V. Radio (hack V.W.

Uher Lumber Co. ana's Star furniture Dixie Shoe Shop McDonough Iron Edwards Medical Supply KILC Imperial Sugar Co. Quality Cleonars Stewart J. Stevenian Schwartz's Inc. General Nutrition Merle Norman Smaks Wyatts Cafeteria Oalton West fnd Cycle Co.

Sharwln Williams Amarlcan Fance Martorell Roofing Co. Century Papers, Co. The OlJ House Company Travel Counselors. K.C. Market Galalan Ira Levin Realtors Oalveston Scrap Processors CCA A Swim Team Samuel Diaz deLeon Jewelers Santlnl Bros.

Inc. Charna Oraber Real Istate Pilgrim Cleaners L.O. Zepp Real lltale Co. Fred F. Hunter Reader Offshore Helicopter Implre OasCo.

Jolos Restaurant Toworz Barbershop Keltner Insurance Tevas Drugs Industrial Meterlal J-lana Sarvlcas Oalveston Dally News Charley's A. M. Terry I Co. Reeltors Oulf Lumbar Co. Inc.

Or. Don T. Henderson Jungle SuH Water tilde La Qulnta Motor Inn Cellna's Beauty Shop Corollas Corral Tha Posh Aramco Blinds Blue Marlln Const. Inc. Nygafa Chemical Co.

Oalvelton Shipbuilding Co. Farmer's Marine Cooper Works Inc. The Oerbert Co. Vltex Packing Inc. Save Five, Inc.

ABC Really Athletic Attic Island Optical Dava's Treasure Island Tackle Ruck's Key Shop Whltmore's Ilectrlc Clinic Kathy's Katerers Joe's Pharmacy Center Tom's Thumb Nursery Flame 'N' Frama Shop Seaside Nursery Roble Karate Academy Sanders Remodeling V.W. Uher American Handicraft Junction Kay Jeweleri King olomon's Mr. Music Plersoo's Simpsons Shoes Mr. D'sDonuts Crescent Ilectrlc Co. Nlta's Beauty Shop Steve's Floor Covering Plummer's Pelt Control Burko's Grooming Shop Seal Fleet, Inc.

Beauty Boi West Ind Grocery William H. Nogan, Contractor Luke's Little Supermarket Irnle Wallece Oolf Acodemy Oalveston Roofing Moore.Cllmetlc Mlelke's Repair lie Slate Pest Control John's T.V. Oalvetlon Veterinary Clinic Ocean Magic Dlax deLeon Jewerly Aercom Village In ranee Al J. SonAealty Benson's Western Auto OaLveiton County Tax Office Island Interiors Hernandez Carpet Collier Republic Parti BlehlACo. Illand Olatft Co.

Fred Molor Aladdin Illand Auto Wax W.A.K«l«oBld 0 lnduitrl.ii American Fvnce Supply Cowboy Center Total Fltneit Center foyva Shoei Superior Title tenee'i Hallmark TUh HfC T-ShlrttPtui Mthermon'k Wharf A Wholesale Oracen Ivey'i Ixvan Captain's Table Candy't Seymour Appltance Island Transmission Vacuum National Security Worthern Ilectrlc The Summit Appliance Service JAM Auto Morrli Mobil Jewelry keep the regulatory eye on the Hunts. "I don't think that's a factor," Hunt said The claim by Bunker and Herbert that their speculative forays are taken separately has been a weak point in their defense of their silver dealings before congressional and regulatory committees. Their offices, with the doors always open, are on either side of a small reception area and, given the admitted closeness of the so-called "first family" H.L. Hunt sired three separate families that claim is widely disbelieved. But Hunt insisted that, while he and Bunker "do talk about things from time to they handle their investments separately.

Hunt more than once stressed that the brothers' troubles after the commodities exchanges imposed stringent margin and position limits that caused silver to plummet from $50 an ounce to $10.80, came from "over-regulation and a change in the rules." But they knew this was a possibility. Didn't they know the price of silver would have to break after such a heated rise? "Of course we knew that, but by that time we couldn't have bailed out if we wanted to, the market was too illiquid. In fact the illiquidity that was created by position limits and the rise in margins was the reason the price went up so much." Herbert, who spoke in the singular when referring to his silver dealings, also denied he was "pyramiding" or using his profits as collateral to make additional purchases. After silver hit $30 an ounce, most of his profits were going to meet additional margin requirements, and in trying to comply with limits, he said. "It was an absurd situation.

In order to get my position down to the new limits I had to do e.f.p.'s, I had to take coins because there wasn't enough silver to allow me to get out." Hunt was referring to a transaction called an "exchange for physical" when the owner of a forward contract makes an agreement with a bullion dealer to exchange the contract for actual metal outside of the commodity markets. This prevents a "squeeze" on the amount of silver available for delivery in commodities exchange warehouses. Hunt also confirmed that they took somewhat of a shellacking on the e.f.p.'s since some of the coins they took in exchange for silver were selling at a substantial discount on the open market at that time. Hunt disputed a statement by Lee Berendt, president of the New York Commodity Exchange, that board members of the Comex had nothing to gain by the rules they imposed that Hunt said "killed the market." "What he didn't point out is that the shorts (professional hedgers and trade houses) were being forced to come up with additional margin every day that silver rose, even though hedged. They were having to borrow this money from banks when interest rates were near 20 percent," Hunt said.

Because of the amount of the loans being required by some of the big dealers, "many of them had reached the point where they were no longer able to borrow. They had a lot to gain by a drop in OPERATION price in a few cases their survival." A $1.1 billion loan the Hunts obtained from banks to pay off their silver debts, also was justified, Hunt said. "We have the assets to back the loan. It's a straightforward deal." The Hunts want to keep their remaining 63 million ounces of silver, Hunt said. "The loan agreement only states that I cannot speculate in silver while it Is outstanding.

We do not have to liquidate the silver. The agreement only provides for the orderly liquidation of the silver if it Is necessary to pay off the loan, and we don't think that will be necessary." tCRVICE IMPLOYMENT IIDEVILOPMf NT EARN WHILE YOU LEARN! Applications are NOW being accepted for Basic Training in Shipfitting and Welding Classes Applicants Are Requested To Bring: Valid Drivers License or l.D./Proof of Residency TT Social Security Duplicate of Application Proof of income (Last 6 months) Check Stubs or Letter of Earnings ft LOCATIONS ft GALVESTON 1902 AVENUE (713)765-9313 TEXAS CITY 5404 HIGHWAY 1765 (713)938-1227 Ser is on equal opportunity employment and training program sponsored by the Galveston County Commissioners Court linillHIIHllflHIlllllHIIIIillllinOT DO YOU NEED MONEY? THE GOLD ROOM 1830 TEX AS AVE. TEXAS CITY Old Gold rings, Class Rings, chains, bracelets, pins, mountings, Wedding Bands, Old Watches, etc. ANYTHING 10 14 18 KT, Gold; platinum, sterling silver, Dental gold sterling flatware -silver and gold coins! Regardless of condition no amount too small or too large -all transactions cash! So -clean out your jewelry box, you may have hundreds of dollars worth of unwanted, unusable, obsolete, gold or silver, DON'T GIVE YOUR GOLD AWAY! WE PAY HIGH PRICES AND OFFER YOU COURTEOUS, CONFIDENTIAL SERVICE! OPEN: 10:00 AM DAILY AND SATURDAY CHECK OUR PRICES.