2016 Postmortem

kentuck

(112,767 posts) Mon Dec 26, 2016, 04:05 PM Dec 2016

How difficult could it be to divest from businesses that only have your name on their hotels?

Donald Trump doesn't own many of the buildings that carry his name. Why hasn't he divested from these businesses already?

Many of them are in foreign countries but many are in NYC and other places in this country. It seems it should be much easier to break from than buildings that are actually owned by Trump?

But, it appears that the billionaire "builder" doesn't want to divest from anything?

5 replies

= new reply since forum marked as read

Highlight:

How difficult could it be to divest from businesses that only have your name on their hotels? (Original Post) kentuck Dec 2016 OP

Very difficult radical noodle Dec 2016 #1

There is a market in which you can sell stocks immediately without thinking HoneyBadger Dec 2016 #2

Doesn't want to divest from anything, or can't afford to divest? Brother Buzz Dec 2016 #3

It sounds like a massive Ponzi scheme csziggy Dec 2016 #5

I have seen crazier HoneyBadger Dec 2016 #4

radical noodle

(8,579 posts)

1. Very difficult

Reply to kentuck (Original post)

Mon Dec 26, 2016, 04:13 PM

Dec 2016

if he owes more than he owns.

HoneyBadger

(2,297 posts)

2. There is a market in which you can sell stocks immediately without thinking

Reply to kentuck (Original post)

Mon Dec 26, 2016, 04:20 PM

Dec 2016

In fact management of public companies are required to do this without much oversight in order to prevent accusations of timing. $100M + commercial real estate deals are more about handshakes and dinners. The accountants run the numbers, but the deals are made by a couple of rich guys that have known each other all their lives. So divesting oneself of real estate does not happen in the same way. These guys are not flipping HUD properties for $20k. On the other hand, there is very very little that an owner of property can do to affect value in the sheet term. If it happens, it happens. Else you are looking at 20 years down the line. In addition, his properties are everywhere. Not like he is going to pump up values in Bushwick because that is all he has.

Brother Buzz

(37,795 posts)

3. Doesn't want to divest from anything, or can't afford to divest?

Reply to kentuck (Original post)

Mon Dec 26, 2016, 04:45 PM

Dec 2016

I have no clue how much of this list is accurate, but it's enough to give me pause:

Trumpnado ‏@Trumpnado2016 Dec 13
1/ The Trump Org is NOT a corporation.
It is a mess of personally owned LLC's on Donald's personal income tax return.
@Newsweek

2/ Because of the way Trump set up his biz, to personally benefit from tax losses, he CAN NOT disentangle personally.
@kurteichenwald

3/ Trump's massive tax loss carry-forward was on his personal tax return, thus all income must ...
@kurteichenwald

4/ ... must remain as personal income for Donald to be able to take advantage of this massive tax break.
@kurteichenwald @nytimes

5/ so even if Donald wanted to, Trump can not afford to disentangle as personal owner of 500+ personal LLC's.

6/ NO ONE has been asking why he would have 500+ sole proprietorships/partnerships.
It is the only way he can use these massive tax breaks.

7/ There are huge advantages of efficiency & capital to operate as a large real corporation, so Donald made this decision for this purpose.

8/ after decades of running his biz as 500+ LLC's, it would be financially impossible to untangle. Taking many years, if even possible.

9/ Trump CAN NOT untangle from personally benefiting from every deal made by Trump Org entities. He owns each one personally.

10/ most of these LLC's carry large debt from different banks, tied to that asset. Most have more debt than the asset is worth.

11/ with such massive debt, there is really no way to untangle this LLC mess of companies from Donald personally.

12/ further even if bankers allowed him to sell these biz's, he could not afford the massive tax payments that would result.

13/ selling these personal assets, even if saddled with massive debt would incur huge tax payments for Trump. He simply can't afford it.

14/ Trump also has massive annual expenses.
Over $20 mil just for the Trump Tower retail condo. He must generate massive cash flow.

15/ And Wells Fargo owns the mortgage on Trump Tower retail condo, so yet another conflict of interest.

16/ Trump claims ownership of the Nike Store,
but yet another lie, he only owns a land lease of questionable value.
Block 1292 Lots 8,64,66

17/ NONE of the LLC's that own Nike Store are on Trump's FEC form. He rents the land from others.

18/ if you combine debt Trump has on Nike Store & 3 Trump Tower condos he owns, he's underwater, by a lot!
Trump DOES NOT own Trump Tower

19/ Trump DOES NOT own 40 Wall St.
He owns a land lease that is worth less than the debt he has on the property.

20/ When a land leases expires, all buildings/improvements on the property revert to property owner.

21/ Christian Hinneberg et al & other German partners OWN 40 Wall St. Trump just rents it from them.

22/ Trump has to get permission from the owner, Christian Hinneberg, to turn on the water at 40 Wall St.

23/ over 400 Trump LLC's are registered under highly secretive Delaware Corp laws.
We have no idea who his partners are,
or what debt

24/ Trump has set up a highly unusual labyrinth of secretive DE LLC's. There is no way he can, or will, disentangle his personal ownership.

25/ Trump requires a huge influx of new cash deals to service his massive existing expenses & debts, must make new deals or risk bankruptcy.

26/ No business journal has done a comprehensive estimate of Trump income/balance sheet/profit loss.
It can be done, but has not.

27/ Hotels & golf courses are notorious for marginal profits or losses, yet Trump is claiming massive unrealistic income from these biz's.

28/ Trump is lying
Trump biz's historically ALWAYS lose money.
He profits from govt zoning gifts & condo deals we know are mostly dark money

29/ Trump could not run a golf course or hotel at a profit, simply impossible based on his horrible management record.

23/ Equitable Life Insurance of the USA developed Trump Tower & owned the land.
Trump profited by bringing govt zoning gifts & ...

24/ ... being the front man for Equitable to partner with the mob, get ridiculous tax breaks & destroy a historic façade of Bonwitt Teller.

https://twitter.com/Trumpnado2016/status/808666847491006469

csziggy

(34,189 posts)

5. It sounds like a massive Ponzi scheme

Reply to Brother Buzz (Reply #3)

Mon Dec 26, 2016, 11:29 PM

Dec 2016

"Trump requires a huge influx of new cash deals to service his massive existing expenses & debts, must make new deals or risk bankruptcy."

A Ponzi scheme (/ˈpɒn.zi/; also a Ponzi game)[1] is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned through legitimate sources. Operators of Ponzi schemes usually entice new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent.
https://en.wikipedia.org/wiki/Ponzi_scheme

While Trump's business facade is mostly constructed to inflate his claims of his personal net worth, what is described in your message as quoted above sure fits the description of a Ponzi scheme!

HoneyBadger

(2,297 posts)

4. I have seen crazier

Reply to kentuck (Original post)

Mon Dec 26, 2016, 04:49 PM

Dec 2016

Used to work for the guy that essentially owned the World Trade Centers (long term lease). Yes it was ONE guy, his company was set up like a checking account. I could not believe that a company of that size and value had the same structure as a lemonade stand. Real estate is a weird business.

Reply to this discussion