Trump

I heard someone on a call-in radio show say, “Donald Trump’s business experience makes him far more qualified to get our country out of our financial difficulties than Obama.”

Really?

Trump financed the construction of his third casino, the $1 billion Taj Mahal, primarily with high-interest junk bonds.

In the August 21, 1990 edition of the Jersey Record, columnist Mike Kelly wrote “If we still had debtors’ prisons, Trump would be in the dungeon.”
Although he shored up his businesses with additional loans and postponed interest payments, by 1991 increasing debt brought Trump to business bankruptcy and the brink of personal bankruptcy.

Banks and bond holders had lost hundreds of millions of dollars, but opted to restructure his debt to avoid the risk of losing more money in court.

The Taj Mahal re-emerged from bankruptcy on Oct 5, 1991, with Trump ceding 50% ownership in the casino to the original bondholders in exchange for
lowered interest rates on the debt and more time to pay it off.

By 1994, Trump had eliminated a large portion of his $900 million personal debt and reduced significantly his nearly $3.5 billion in business debt.

He was forced to relinquish the Trump Shuttle (which he had bought in 1989), but he managed to retain Trump Tower in New York City and control of his three casinos in Atlantic City.

Chase Manhattan Bank, which lent Trump the money to buy the West Side yards, his biggest Manhattan parcel, forced the sale of a parcel to Asian developers.

In 1995, he combined his casino holdings into the publicly held Trump Hotels & Casino Resorts. Wall Street drove its stock above $35 in 1996, but by 1998 it had fallen into single digits as the company remained profitless and struggled to pay just the interest on its nearly $2 billion in debt.

In a May 28, 2004, Wall Street Journal article, Trump said the specter of bankruptcy bothered him “from a psychological standpoint,” but added, “it really wouldn’t matter that much.”

A number of his bondholders disagreed. In the same article, Meyer Marvald, a Florida retiree who said he owned about $44,000 of the bonds, claimed “Trump has the Sword of Damocles hanging over our heads.” On October 21, 2004, Trump Hotels & Casino Resorts announced a restructuring of its debt. The plan called for Trump’s individual ownership to be reduced from 56 percent to 27 percent, with bondholders receiving stock in exchange for surrendering part of the debt. Since then,
Trump Hotels has been forced to seek voluntary bankruptcy protection. After the company applied for Chapter 11 Protection in November, 2004, Trump relinquished his CEO position but retained a role as Chairman of the Board. In May, 2005 the company re-emerged from bankruptcy as Trump Entertainment.

Trump’s ruthless dealings have ruined many lives. Anyone who thinks his business experience qualifies him to run our country would probably consider Sarah Palin an intellectual.