The Art of the Comeback, by Donald Trump: on Corporations
Personal bankruptcy is a negotiating tool; I'd never do it
In March of 1990 I told Wall Street I might miss Trump Castle's $43 million principal and interest payment. This announcement reverberated around the world because I had never missed any payment before.
Suddenly bankers--some I'd worked with for a decade--were doubting my ability to make upcoming payments on my other loans. They were right to be skeptical. I wasn't sure myself where the money would be coming from.
The problems at the Castle could have triggered a series of defaults, forcing me into personal bankruptcy. And there was no way Donald Trump was going bankrupt!
I would talk about bankruptcy and I would use that possibility as a tool to negotiate, but I'd never do it. That would end the game.
Source: The Art of the Comeback, by Donald Trump, p. 12
Oct 27, 1997
We've all been victims of herd mentality on Wall Street
Business was great. So I said, "Let's go. It's time to go public." At the height of the market, we hit. I raised over $2 billion. While my casinos are individually doing very well, casino stocks have been hit very hard. Wall Street has been tough on us.
I find this somewhat unfair, being grouped with a lot of companies that are fundamentally different. The only thing we have in common is that we run casinos. My company, Trump Hotels & Casino Resorts, is incredibly liquid, with four magnificent casinos,
including one in Buffington Harbor, Indiana, right outside of Chicago. To a large extend, we've all been the victims of Wall Street. There can be a bit of a herd mentality there. Once on analyst starts dumping on an industry, often the others follow.
Right now, as I write this chapter, the casino markets have been lousy. They will come back, though. I have tremendous confidence in the future of Atlantic City and my hotels in particular. Time, I believe, will prove me right.
Source: The Art of the Comeback, by Donald Trump, p. 41-3
Oct 27, 1997
Vulture lawyers look for businesses known to settle cases
Lawyers in general did really bother me. For instance, often a case will be presented to me in which I am being sued for X dollars and a settlement will be offered for substantially less than what my legal fees would be. Depending on the type of case
it is, I will often reject the settlement. When a businessman becomes known as someone who easily settles cases, it creates a very bad precedent.
While it may often be the thing to do, it allows vulture lawyers to watch various companies and see who are and who aren't the "settlers."
The moment someone settles or makes it easy for a particular lawyer, he will inevitably return with another suit a short time later. Also, his scavenger friends who were watching will likewise find reason to sue.
Source: The Art of the Comeback, by Donald Trump, p.103-4
Oct 27, 1997
Litigation system is abused to force deal negotiations
Litigation has gotten totally out of control. It has actually become an accepted business practice for people to use the court's time, money and energy in order to effect deals, break up deals, and receive money unjustly. I know people who virtually
can't function without starting a lawsuit, thinking that this will give them the upper hand in even the most simple of negotiations.Politicians ought to be ashamed of themselves for perpetuating this ridiculous situation. Court systems have become
backlogged for years with superfluous cases. In New York in particular, a case will often take seven or eight years to actually get to court. This is certainly not the judge's fault, because most of the judges in New York are hardworking, diligent men
and women with brilliant legal minds. The fault lies in a system that is meant to be abused, and which is costing states and the country hundreds of millions of dollars. Perhaps more important, its creating centuries worth of delay.
Source: The Art of the Comeback, by Donald Trump, p.104
Oct 27, 1997
Page last updated: Mar 19, 2019