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$421 Million in Debt: Trump Calls It ‘a Peanut,’ but Challenges Lie Ahead
Trump's largest creditor, Deutsche Bank, has been investigated for money laundering and in 2017 paid a $7.2 billion fine for the sale of toxic mortgage securities in the run-up to the 2008 financial crisis.
It is highly dangerous when the president of a nation owes $421 million to creditors. In addition, Trump owes another $447 million to unknown entities.....
10/16/20
President Trump painted a rosy picture of his financial condition during a televised town hall on Thursday night, calling his hundreds of millions of dollars in debt coming due “a peanut” and saying he had borrowed it as a favor to lenders eager to take advantage of his financial strength. In fact, the loans, and the unusual requirement he had to accept to receive them, illustrate the financial challenges he faces and the longstanding reluctance of banks to deal with him. Mr. Trump had to personally guarantee $421 million in debt, a rare step that lenders only require of businesses that may not be able to repay. The commitment puts his assets on the line and could place his lenders, should he be re-elected, in the position of deciding whether to foreclose on a sitting president. The personal guarantee also speaks to why, despite Mr. Trump’s assertion that banks are eager to lend him money, nearly all the money he borrowed in the last decade came from only two institutions. “When a bank asks for a personal guarantee, it is because the bank isn’t satisfied with the creditworthiness of the borrower,” said Richard Scott Carnell, who served as assistant secretary for financial institutions at the Treasury Department under President Bill Clinton and teaches law at Fordham University. “If the captain gives a personal guarantee for the ship, he will be less likely to sink it.”
Mr. Trump was asked about the debt in response to an investigation by The New York Times published last month based on a review of more than two decades of his tax-return data. The investigation found that Mr. Trump had personally guaranteed $421 million of his companies’ debts, with more than $300 million coming due within four years. The Times also found evidence that Mr. Trump might have difficulty repaying or refinancing the loans without liquidating assets. His main source of income in recent decades — a total of more than $427 million from entertainment and licensing deals that were fueled by his fame — has all but dried up. That cash enabled a buying spree of failing golf courses, and propped up those businesses as their losses mounted. In recent years, Mr. Trump has burned through most of the cash, stocks and bonds at his disposal and has recently explored the sale of some of his holdings, including the Trump International Hotel in Washington. The bulk of the debt appears to be owed to Deutsche Bank, one of the few lenders that would do business with Mr. Trump in the last decade, even after he defaulted on past loans. Deutsche Bank is the only mainstream financial institution that has been consistently willing to do business with Mr. Trump. And even that lender has required him to personally guarantee what he has borrowed.
Trump's largest creditor, Deutsche Bank, has been investigated for money laundering and in 2017 paid a $7.2 billion fine for the sale of toxic mortgage securities in the run-up to the 2008 financial crisis.
It is highly dangerous when the president of a nation owes $421 million to creditors. In addition, Trump owes another $447 million to unknown entities.....
Donald Trump Has At Least $1 Billion In Debt, More Than Twice The Amount He Suggested
https://www.forbes.com/sites/danalexander/2020/10/16/donald-trump-has-at-least-1-billion-in-debt-more-than-twice-the-amount-he-suggested/#35948c764330 10/16/20 No aspect of Donald Trump’s business has been the subject of more speculation than his debt load. Lots of people believe the president...
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