November 20, 2014 – It all started when 28-year-old Bruce McNall bought a racing horse one day in March 1978. The animal was extremely promising, a horse from the stables of one the world’s richest men, from Nelson Bunker Hunt’s stud, to be precise.
Nelson Bunker Hunt was son to oil magnate H. L. Hunt, founder of Placid Oil. He had entered in his father’s business, developed oil fields in Libya and then lost them to Gaddafi. When McNall and Hunt met, Hunt was on to something really big, what he believed to be the investment of a lifetime: Together with his brother Herbert, he wanted to corner the silver market. Nelson Bunker Hunt, it turned out, was the perfect target for an ambitious and ruthless coin dealer like Bruce McNall.
The first deal that McNall struck for Hunt made Hunt one of the most important coin collectors in the world overnight. Sy Weintraub, in his day film producer, wanted to sell his coin collection. He had acquired it for 4 million dollars. Now he wanted 16 million. Even factoring in the increase in prices of the time, the coins were not worth that much. McNall found a solution: Hunt would pay 8 million in cash. And Weintraub would receive the missing 8 million in horses.
Bruce McNall became Hunt’s coin dealer and a rich man. Rich enough to show great generosity, for instance by inviting the Hunt brothers on extended trips to the Aegean. Of course, he made sure to get back his money’s worth. A good example of that is for instance the decadrachm from Acragas, two-time record holder as the world’s most expensive Greek coin. The Hunt brothers bought it from McNall for 1 million dollars, which was the record at the time. The coin made its second record sale on 17 October 2012, when it changed hands for 2.3 million Suisse francs. His previous owner must have been delighted about that – other than the Hunts. In 1990, they had sold the coin at Sotherby’s for only 572,000 dollars. Less auction fee, that meant a loss of half a million dollars.
Even bigger was the loss resulting from the Hunts’ idea to acquire all existing Byzantine coins in order to control the market. In his biography, Bruce McNall tells us how this idea came into being: “I had pretty much lost all hope of turning the Hunt brothers into art lovers when we went to Zurich to see the offerings at Bank Leu. Leo Mildenberg, who was keenly aware of the Hunt’s money, began our meeting by telling the Hunts I was perhaps the greatest coin dealer in the world, and that they were in expert hands. He then brought out tray after tray of coins, at least a million dollar’s worth. … “What about gold coins?” asked Herbert. “And what can you show us that is undervalued?” Gold coins, especially Byzantine gold, were undervalued at that time. As I explained that to Herbert, Leo brought out a couple of trays filled with nickel-size coins. They were valued, on average, at about $400 a piece. This was just a couple hundred dollars more than a typical U.S. gold piece, but they were so much rarer, and so much more beautiful, that Herbert instantly appreciated their value. After he looked at the trays, and quizzed me about prices, Herbert said, “Okay, what would it take to buy all the Byzantine gold coins?” “You mean all the coins right here?” I asked. “No,” he said, “I mean all the coins there are, in the world. Everything.” I looked at Leo, and his face was blank as my mind.”
You can imagine the profits McNall made buying coins for the Hunt brothers on a grand scale. His company Numismatic Fine Arts (NFA) thrived and prospered. Until Bruce McNall’s own greed got into the way and he made a mistake: In 1982, he agreed to accept a 20 million dollar payment in silver because the Hunts were short of cash. The advantage: He received the payment for 312 coins, which at the time only existed in form of a list and which he was going to buy later on. The disadvantage: He sold neither the silver – which shortly after dropped to an all-time low and would not rise again, nor did he go on to buy the coins. So when, one day in 1988, Hunt called him to say that the banks wanted to look at all his assets, Bruce McNall faced the challenge of finding and buying 312 extremely rare coins in a very short time. Which he did without batting an eyelid. He spent some 10 million dollars on shopping trips in Munich, Basel and Zurich, not caring about the incredible sums he was paying. He was certain that, after the inspection, he would be able to return all coins at cost.
What McNall didn’t know was that meanwhile the situation had changed. The Hunt brothers had declared bankruptcy. The largest part of their fortune had to be sold to pay off their debts. Among it were also the 312 coins that McNall now could not return anymore.
Somehow, miraculously, the clever coin dealer managed to get even through this crisis. As film producer, owner of racing horses and a baseball team, he accumulated 90 million dollars in debt that eventually got him into prison.
Nelson Bunker Hunt, on the other side, still possessed enough money even after his bankruptcy to live a very comfortable life and invest round 2 million dollars in a new stud farm in 1999.
Nelson Bunker Hunt died on 21 October 2014 from cancer and dementia.
If you want to know more about Bruce McNall and Nelson Bunker Hunt, take a look at McNall’s autobiography “Fun while it lasted”. McNall may not be the most reliable witness of his own story, but he certainly gives you a good impression of the coin market and coin dealers in the 80s.
You can order the book on Amazon.