Trump has been lying about his supposed wealth for a long time. A good part of that has to do with the scam surrounding the “Trump” brand, and it’s supposed value in the luxury marketplace. A good portion of his self reported $10 billion in wealth is based on wildly inflated value of the Trump name. Even his hard assets , the Golf Courses, Hotels, and Casino aren’t worth nearly as much as an uncritical eye would believe.Like anyone who is big in commercial Real Estate, Trump is heavily “leveraged”. In layman’s terms it is like owning $200,000 on a house which can only be sold today for $100,000 – betting that the Real Estate value of houses in the area will go up in 3 years enough to make a profit after paying off the debt. In the high-flying world of certain types of business, your ability to acquire debt is counted as an asset. Ergo, you are worth $1 million – because you can borrow $1 million, even though you only have $100 in the bank. The reason so many Real Estate folks go bankrupt quite simply is they cannot generate enough revenue based on their investments to cover the debt. That house you owe $200,000 on has a monthly mortgage of $2,000, and it can be rented for only $1,000 a month – meaning you have to come up with another $1,000 a month to make the mortgage from somewhere else. Buy enough of those, and don’t flip them fast enough, and you go bankrupt.
In the real world, your net worth is the value of what you own or have in the bank, minus what you owe. Cash on hand is king. $100 in assets with $50 in debt mean you are worth $50.
In Trump’s world, if you have $50 million cash in the bank, and $100 million in debt – you can easily borrow another $100 million, and are “worth” $200 million. What you can’t do, is not have enough cash to make the payments…
Which from all indications is about where the Chumph is. Stealing $1 million a month from his campaign coffers to service the debt on his various scams by paying his own companies, strongly suggest he not only has a cash flow problem, he is at or past the point of having a negative net worth.
Despite all the huffing and puffing…It indeed looks like the boy is busted.
Now there is a huge difference between a guy like Warren Buffet, and a Chump wannabe billionaire. Warren can write a check for $1 billion, and frequently comes up with $50, $100, or even $500 million as part of his investment empire. The Chump on the other hand, seems to be struggling to have $1 million cash on hand to pay his promised charity donation to Veterans – which he apparently paid from his campaign donations.
Take that from a guy who has experience being hired to do “due diligence” in major investment deals to discover the true value of a company’s assets.
It’s important to see those numbers in the proper perspective.
Yes, Clinton has massively more money than Trump. But that’s about the amount of money sheshould have. This isn’t to take away from the accomplishment. It’s a lot of money and it came while she was still having to spend money on the on-going primaries. But it’s in the range of what you would expect from a well-oiled team of professionals drawing on a robust fundraising apparatus. Trump’s amount of cash wouldn’t be terribly impressive for a competitive House race. His campaign is essentially broke. Which, as I noted yesterday, means Trump must be broke, too, or so cash poor as to amount to the same thing for the purposes of this campaign.
Even more revealing is the fact that Trump has been using a huge amount of campaign expenditures to cycle money back through his own businesses. According to an analysis by the AP, through the end of May Trump had plowed $6.2 million into various Trump companies, which is to say, back into his own pocket. That’s roughly 10% of his campaign spending so far, which is almost entirely from the loan (which he can still repay to himself out of future fundraising) he made to his campaign. He kept up the pace in May, spending $6.7 million on his campaign and more than a million of that to various Trump enterprises.
What’s notable about that roughly 10% of money back into his own pocket is that Trump only has businesses in so many sectors. He doesn’t appear to have a company to make red trucker hats and he doesn’t own radio and TV stations to run ads. So that 10% is basically as much as he could possibly run to own companies.
Perhaps the most revealing detail about the May filing is that Trump actually did loan his campaign additional funds – a bit over $2 million. But this shows more just how hard up Trump is. His campaign is in desperate need of funds. Like I said, $1.3 million cash on hand is stone broke for a summer presidential campaign. He clearly has no principled resistance to loaning his campaign more money. And he’s in desperate need of a few tens of millions of dollars. Put this together with having to be shamed into coughing up the $1 million contribution to a vets organization and the implication is clear: Trump is very hard pressed to come up with even a few million dollars. And this from a man purportedly worth $10 billion.
Trump’s promises of vast riches got the GOP into a bind relying on him to fund a general election on his own. But that was all a lie. He’s broke or near broke. And the GOP is now facing mid-summer with a campaign that is broke, has no fundraising apparatus, no candidate with big bucks and no field operation. He’s done the GOP worse than the most screwed over creditor he ever sharked.