We never imagined we’d find ourselves rooting for Carl Icahn, the sleazy corporate raider, but then, we had not foreseen his taking on the even more unctuous and loathsome Donald Trump. The two have squared off in bankruptcy court in Camden, New Jersey, with Icahn seeking to wrest control of Trump Entertainment Resort, Inc., owner of three bankrupt Atlantic City casinos. If Icahn wins, he wants rights to the Trump name — but not for the reason you might think. Mainly, he’s trying to avoid the $20 million expense of changing the signs on Trump’s casino-hotels. For his part, Trump insists that his name alone is worth billions and that Icahn should not have rights to it if he takes control of Trump Entertainment. “Everyone wants the [Trump] brand, including Carl,” Trump said recently in an interview. “It’s the hottest brand in the country.”
How hot is that? Trump claims his brand was recently appraised at $3 billion. We don’t know how the appraiser came up with that number, since Trump’s name is mud in New Jersey and on its way to becoming mud in Florida and elsewhere as deflation crushes real estate leverageurs like bugs. Trump’s New Jersey casinos have been in bankruptcy three times, including during relatively good times in Atlantic City, and he’s screwed so many partners and shareholders over the years that he’d be foolish to travel without a bodyguard.
Loudmouth ‘Alchemy’
Moreover, Trump’s self-proclaimed business acumen is arguably non-existent; it is only his world-class mouth that has worked alchemy on leaden deals that would have ruined less gifted promoters. As SPY magazine documented in a famous cover story years ago, the only time Trump succeeded was when he partnered with businessmen such as the Pritzkers who knew what they were doing. Otherwise, as the SPY article documented, the “short-fingered vulgarian’s” modus operandi was to carve up companies he’d bankrupted through inept management, and then to walk away with their best parts after screwing shareholders and bondholders.
This time, Trump is trying to do right by the bondholders because they are his only allies in the battle with Icahn. They are owed $1.2 billion and think Trump’s name should be included in any reorganization deal. But as Icahn points out in a court filing, “The Trump name may no longer be ‘synonymous with business acumen, high quality and style, a luxury lifestyle and enormous success’ as Mr. Trump asserts.” Indeed, although Trump’s world-class mouth and his ability to captivate reality TV’s discerning audience will never allow him to go broke, his reputation for being the consummate deal-maker and business executive is on its way to the dumper.
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I forget exactly which mogul it was who said it, but he is famous for raising big bucks for business ventures that go under after he rakes in millions for himself.
A reporter asked him how he felt about that situation, and he laughed and said, “People keep loaning me money, so I take it.” P T Barnum is eternally right!
May I also point out that Trump in the 70’s was a precursor to the Too Big To Fail bunkum now spinning in Fed circles, for he was about to go down then and threatened to take the banks down with him. Were it not for his big mouth and slew of glamorous women (from a musician’s perspective, I have private knowledge of his power over women) , he would not have been saved then or subsequently re-saved by the next ensuing real-estate bubble. Icahn merely symbolizes economic evil. Trump transcends that through social depravity.
Yay, Rick. Never been able to stand Trump. Not fond of Icahn either – as far as I’m concerned, Icahn helped start the US on the way to the dumper. But “the Donald”? (pardon me whilst I gag)…yeah, I’d like to see him behind the wheel of a big rig…unless he’s as bad behind that kind of wheel, as well.
That is an ugly contest, for sure.
I’d have to say that Trump is the fugliest because his so so sure and confident of himself, when he really is just a loud, size 100, empty suit with cartoonish hair. The most innovative thing he has done, IMHO, was “The Apprentice”. But even he did not do that, it was the Mark Burnett. Otherwise, he is just a highly leveraged Contractor-Gone-Wild, enjoying the fruits of inflation of property alone, that can’t run the operations of real business (see casino failures).
In the aftermath of the ‘87 crash, my options trading partner and I dusted ourselves off, paid our debts, and rebuilt from the ground up. It was hard, but we persevered. He said, “It is going to be entertaining to watch Trump fail. There is no way he can recover.” But he did the improbable and borrowed even more. Here we are nearly a quarter century later, his wave is even bigger, he is further out on the board and I think he is the ultimate coal mine canary for debt. When the Donald drowns we will be within months of a real longterm bottom. Not that it will be “V shaped”, but his failure will be one of many signatures of the real end.
Finally, Icahn should actually use Trumps balance sheet against him. Trump is right that at one point in time the Trump name was worth a lot. Not now, it is a liability. It is quite possible that the Trump name could become Corporate Kooties which no one wants to get near, especially when considering gambling. Icahn should charge Trump so that the scourge can be removed from his new building.
Off topic, but go to this link http://www.redress.cc/global/cking20100301
If this guy is correct, the government has a plan afterall, along the lines of what we all figured but on a far grander scale. Perfect plan to be executed by General Jack D Ripper from Burbleson Air Force Base!
Both of these guys have sold their values for the high life. . . of course I’m assuming they had some sort of moral fiber to start with. A lot of people lost a ton of money on some of Trump’s latest deals when they went belly up.
Military, Oil and the Suburbs:
http://www.youtube.com/watch?v=MfGZ1MWRNxU
Back in 2003 my wife and I bought a home in the historic district of Cartegena, Colombia, it was a wreck and took a lot of work but she was from the area and we both thought it was a good investment. After 3 yrs of off again on again work we finally completed our renovation in late 2006 just when we heard Trump was coming in to build “luxury” suites less than a mile down the road, off the beach no less. Property prices exploded immediately, people there didn’t know what Trump was about but they sure knew who Trump was. Within days we were flooded with offers from all types of foreign investors looking to flip our house and catch the Trump wave. We got an offer we couldn’t refuse, sold, and then Trump never pulled it off, (financing, go figure) prices crashed quickly as they surged.
I’d read about the Donald before all that and felt like he wasn’t who made himself out to be but I got to thank him for that score.
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