How well did Donald Trump do in the hotel and casino business?

Donald Trump should stick to Miss Universe pageants
Donald Trump should stick to Miss Universe pageants

This story from CBS Marketwatch looks at the only period of Trump’s career for which we have the numbers.

It says:

[T]he only part of his business track record for which we have the full picture shows that Trump wasn’t a successful executive but an absolute catastrophe.

For 10 years between 1995 and 2005, Donald Trump ran Trump Hotels & Casino Resorts — and he did it so badly and incompetently that it collapsed into Chapter 11 bankruptcy. His stockholders were almost entirely wiped out, losing a staggering 89% of their money. The company actually lost money every single year. In total it racked up more than $600 million in net losses over that period.

Trump was chairman of the board throughout the entire time, and CEO as well for about half of it.

Meanwhile, over the same period, all his competitors were enjoying an enormous boom. Take a look at our chart.

While Trump was running Trump Hotels & Casino Resorts into the ground, the Dow Jones index of gambling stocks — the index that Trump himself cited in public filings as his best benchmark — soared 160%. Investors in Harrah’s saw their stake go up by nearly 150%. MGM MGM, -2.56%  quintupled. These people were making out like bandits.

Donald Trump ran the worst performing casino company on the stock market. This isn’t a matter of “opinion.” This isn’t speculation or politics. It’s a matter of plain fact.

However, one person associated with Trump Hotels & Casino Resorts did make money:

Donald J. Trump.

A review of the company’s public filings show that over that period, while his ordinary investors were getting hosed, Trump himself was siphoning millions out of Trump Hotels & Casino Resorts through salary, “bonuses” — yes, really — and cozy “service agreements” or side deals with his private corporations.

Here’s the chart with the info from Trump’s public filings:

Trump casino and hotels performance
Trump casino and hotels performance

You can read more about his four bankruptcies on CNN Money, too.

It says:

Here’s a look at Trump’s bankruptcy track record.

1. Trump Taj Mahal, 1991

To come up with the funds he needed, he sold a 282-foot yacht, as well as the Trump Shuttle, the airline he operated at the time that flew between Washington, D.C., New York and Boston, according to media reports at the time. He had to give up half of his ownership stake in the Trump Taj Mahal, but he did retain control of the property. His largest creditor was financier Carl Icahn, who held $400 million in bonds. Now Icahn is Trump’s pick for Treasury secretary should he be elected.

2. Trump Castle Associates, 1992

In less than a year he was back in bankruptcy court for his other Atlantic City casinos. This bankruptcy included the Trump Plaza Hotel in New York, the Trump Plaza Hotel and Casino in Atlantic City as well as the Trump Castle Casino Resort. He gave up half his interest in the New York Plaza to Citibank, but retained his stake in the casinos.

3. Trump Hotel & Casino Resorts, 2004

Trump didn’t go back to bankruptcy court again until November 2004, when he filed to shed debt at his various Atlantic City casinos and a riverboat in Indiana. It was another quick trip through bankruptcy court; the company shed $500 million in debt and emerged from bankruptcy the following May. Trump turned over majority control of the company to his bondholders but remained the largest single shareholder, and he once again kept control of the casinos.

4. Trump Entertainment Resorts, 2009

His most recent bankruptcy came in 2009, after the company missed a $53.1 million bond payment. That was pretty much the end of the road for Trump in Atlantic City. While his name remained on three casinos, he resigned from the board and gave up his remaining stake in the company.

What if this guy is not a good businessman at all? His tax returns would help us decide, but he won’t release them. Everyone else has released their tax returns, but not Trump. Why not? He says that he is being audited, so the IRS won’t let him. But the IRS came out and said that he can go ahead and release them.

So what’s stopping him? What has he got to hide?

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4 thoughts on “How well did Donald Trump do in the hotel and casino business?”

  1. Well this proves it. The Donald is broke. As a business man myself with this kind of research I am broke too.

    1. Oh, I don’t think he’s broke. This just shows something, it doesn’t go as far as proving he is broke. He needs to release his tax returns like everyone else has.

  2. We get spoiled by equating the likes of Gates, Zuckerberg or Walker with business people. Most businesses fail. 80% of first time starts ups fail in 10 years. Businesses fail with they can’t adapt or because they weren’t prepared. Failure is a fact of life and having a lot of failures doesn’t make you a bad business person.
    Repeating your mistakes does, but at the end of the day, it only takes one home run to make you wealthy.

    Remember, Google Radio and Apple Servers. We call can’t build a Paypal.

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