Economic chutzpah
Only 1,419 days to go...
My brother and I were having a conversation about the events of the Zelensky ambush on Friday. As usual, I bemoaned the fact that Trump was in the White House and how could decent people actually vote to put a convicted felon in the Oval Office?
My brother lives in MAGA territory in northern Michigan so he pushed back a bit. I know he has friends, who voted for Trump. They are of two persuasions:
They liked the 2017 tax cuts and wanted them extended. They knew Trump was an idiot, but they cared more about wealth retention; or
They had been struggling with inflation and thought Trump was going to fix the economy (which by the way was the considered the best economy in the world, for it’s worth.)
He was silent about #1 types, but he did defend the position of the #2 types.
Sorry, I can’t even go there. Anyone, who actually takes the time to read and understand PINO’s record, would never have believed that the man is capable of fixing anything…much less the economy.
But it begs the question…
“In what universe is Donald Trump a capable business man?”
My second question, does Trump even understand anything about business beyond grifting and showmanship?
chutzpah
noun | KHOOTS-puh
What It Means
Chutzpah is shameless or disrespectful boldness often paired with reckless self-confidence.
“Actually, throughout my life, my two greatest assets have been mental stability and being, like, really smart….Sorry losers and haters, but my I.Q. is one of the highest – and you all know it! Please don’t feel so stupid or insecure, it’s not your fault.” ~Donald Trump
Academic Record (Source: The Daily Pennsylvanian)
While Trump continues to flaunt his Wharton degree, his actual legacy at the school remains much murkier. There is no record of him pursuing or obtaining an MBA from Wharton or any other institution. He graduated in 1968 with a Bachelor of Science degree in economics from Wharton's undergraduate program. Prior to attending Wharton, Trump spent two years at Fordham University before transferring. In her 2020 book, Too Much and Never Enough: How My Family Created the World's Most Dangerous Man, Trump's niece, Mary Trump, alleged that he paid someone to take the SAT on his behalf to enhance his chances of being admitted to the University of Pennsylvania's Wharton School. (As of now, there is no concrete evidence to substantiate these allegations.)
An investigation undertaken by The Daily Pennsylvanian found that even though Trump has never corrected the widely-reported claim that he "graduated first in his class," academic records and dozens of his classmates say he was a mediocre student at best. In fact, even though a handful of his classmates say they remember Trump talking in real estate classes “with a heavy New York accent,” a majority of his peers note that they don’t even remember him being in the school.
(Rex Tillerson reportedly has said: Trump was "pretty undisciplined" …"doesn't like to read, doesn't read briefing reports" and a “moron.”)
“These are stupid people that say, `Oh didn’t Trump declare bankruptcy? Didn’t he go bankrupt?’ I didn’t go bankrupt.” ~ Donald Trump
His Business Record
Donald Trump's business career includes six corporate bankruptcies between 1991 and 2009, all involving his hotel and casino ventures. Details of the Bankruptcies:
Trump Taj Mahal (1991): The Atlantic City casino faced financial difficulties due to high debt and underperformance, leading to its first bankruptcy filing.
Trump Plaza Hotel (1992): Located in New York City, this hotel struggled with debt obligations, resulting in a bankruptcy to restructure its finances.
Trump Castle Hotel and Casino (1992): Another Atlantic City property, it encountered financial challenges, prompting a bankruptcy filing to address its debts.
Plaza Hotel (1992): This iconic New York hotel faced significant debt, leading to a bankruptcy filing to reorganize its financial structure.
Trump Hotels and Casino Resorts (2004): The parent company for several Trump properties filed for bankruptcy due to ongoing financial issues and high debt levels.
Trump Entertainment Resorts (2009): Formerly known as Trump Hotels and Casino Resorts, this entity filed for bankruptcy amid continued financial struggles in the casino industry.
Enough said.
“I’m a bit of a P. T. Barnum. I make stars out of everyone.” ~Donald Trump
His Reality TV Stardom
Donald Trump's role on the reality television show The Apprentice significantly bolstered his financial standing during a period when his other business ventures were underperforming. The show not only promoted his public persona but also served as a substantial source of income.
Direct Income: Trump earned approximately $197 million directly from The Apprentice during its run from 2004 to 2015.
Additional Revenue Streams: Leveraging the show's success, Trump secured approximately $230 million through licensing deals, sponsorships, and seminars.
Collectively, these earnings amounted to about $427 million, providing a financial lifeline amid challenges in his other business endeavors.
In other words he made money by acting and self-promotion.
“My father gave me a very small loan of $1M in 1975, and I built it into a company that’s worth many, many billions of dollars.” ~ Donald Trump
Donald Trump as Entitled “Nepo Baby”
A investigative report published by The New York Times found that Trump’s father, Fred Trump, lent his son at least $60.7 million. He received gifts, loans, and inheritance from his father, who was a real-estate developer and businessman. Donald Trump's primary business has been real estate ventures, including hotels, casinos, and golf courses. He also made money from Trump-branded products including neckties, steaks, and urine tests. Money received through political fundraisers is used to pay for guest stays at properties owned by The Trump Organization and to pay his and his allies' lawyers.
In a 2007 sworn deposition, he acknowledged borrowing $9.6 million from his father's estate, and on the presidential campaign trail in 2015, he admitted borrowing $1 million from his father as a young adult. Trump is the beneficiary of several trust funds set up by his father and paternal grandmother, which began in 1949 when he was three. According to The New York Times, he "was a millionaire by age 8. In 1976, Fred Trump set up trust funds of $1 million ($5.5 million in 2024 dollars) for each of his five children and three grandchildren. Donald Trump received $90,000 in 1980 and $214,605 in 1981 through the fund.
The New York Times said in 2018: “Had Trump done nothing but invest the money his father gave him in an index fund that tracks the Standard & Poor’s 500, he would be worth $1.96 billion today.” By 2022, Forbes estimated and wrote “Trump would be an estimated $400 million richer if he had just put his father’s money in the index.”
NOTE: None of this information is new or hidden — it’s right out there for public consumption.
If people would simply check his track record, they would know that bulk of his income came from his inheritance and being a grifter/showman. Bragging that he’s a good businessman and a very smart genius is pure chutzpah.
Timothy L. O'Brien is an American journalist, author and television commentator who has interviewed and written extensively about Trump’s businesses since 1990. To quote O’Brien,
“Living in Donald Trump’s head, you discover there is not very many things in there… a putter, a cheeseburger, a porn video and somebody else’s credit card…he’s always focused on the most basic and visceral things… his various appetites, his various needs. You can understand him through two lenses: self-aggrandizement or self-preservation and very little else.”
Donald Trump assumed the presidency in January 2017, he inherited a robust and growing economy. At that time, the United States was experiencing its longest continuous economic expansion, which began in June 2009 after the 2008 financial meltdown. Key economic indicators from that period include:
Unemployment Rate: The unemployment rate had steadily declined from its peak during the Great Recession, reaching 4.7% by January 2017.
Job Growth: The economy had experienced 76 consecutive months of job growth by the end of the Obama administration.
GDP Growth: The average real GDP growth was approximately 2.6% during the last 11 quarters of the Obama administration.
These metrics indicate that President Trump entered office with a strong economic foundation, characterized by low unemployment, consistent job creation, and steady GDP growth.
Biden inherited a very different economy from Trump in 2021:
Unemployment Rate: The unemployment rate was 6.3% in January 2021.
Gross Domestic Product (GDP): Monthly U.S. GDP rose 1.4% in January 2021, marking the first increase since October 2020.
Inflation: Prices for core goods rose at an annualized rate of 5.3% in January 2021.
Furthermore, Donald Trump Built a National Debt So Big (Even Before the Pandemic) That It’ll Weigh Down the Economy for Years. The King of Debt promised to reduce the national debt — then his tax cuts made it surge. Add in the pandemic, and he oversaw the third-biggest deficit increase of any president.
So don’t tell me things were better under Trump’s economy. In the initial years of the Trump administration, the economy continued the job growth trend inherited from the previous administration. However, the average monthly job growth during Trump's first 33 months was 34,000 jobs fewer than during the last 33 months of the Obama administration. During Covid, the economy lost approximately 2.7 million jobs during Trump's term, marking the first time since employment statistics began in 1939 that a president left office with fewer jobs than when they started.
Furthermore, during his first term Trump initiated several trade conflicts. In 2018, the Trump administration imposed tariffs on billions of dollars' worth of Chinese imports, citing concerns over unfair trade practices and intellectual property theft. China retaliated with tariffs on U.S. goods, leading to a prolonged trade war. The administration also levied tariffs on imports from allied nations, including Canada, Mexico, and the European Union, targeting products like steel and aluminum. These actions strained relationships with traditional U.S. allies.
The Economic Impact:
Increased Costs: Many companies passed the costs of tariffs onto consumers, leading to higher prices for various goods.
Job Losses: Analyses estimated that by August 2019, approximately 300,000 American jobs were lost or not created due to the trade war, particularly affecting manufacturing and retail sectors.
Trade Deficit: The overall U.S. trade deficit widened, as imports from countries other than China increased, offsetting reductions in Chinese imports.
Trump's first term saw significant trade conflicts, especially with China, resulting in economic disruptions and debates over the effectiveness of his policies.
Add to all of this, the U.S. experienced nearly 400,000 COVID-19-related deaths, heightened racial tensions, and the man was impeached twice during his first term as president.
The only positive thing during the pandemic that every day citizens may remember were the two rounds of stimulus checks that Congress authorized through the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and the COVID-related Tax Relief Act of 2020. (Notably, Trump's name appeared on the memo line of the first round of checks—a first for a sitting president—though he did not personally sign them. This inclusion was unprecedented and sparked discussions about the role of presidential branding on government disbursements.)
When people say the economy was better under Trump, they are suffering from amnesia. I see nothing in his track record to suggest that inflation is going to come down and the economy is going to improve while this entitled fool and showman is in office.
Thought for the day in honor of his birthday…
“We are all too much inclined, I think, to walk through life with our eyes shut. There are things all round us and right at our very feet that we have never seen, because we have never really looked.”
~ Alexander Graham Bell
Must Read Article:
This is a warning sign. The historical record shows that when people are hesitant to move or change jobs, productivity falls, innovation declines, living standards stagnate, inequality rises, and social mobility craters. “This is what worries me more than anything else about this moment,” Pollak told me. “A stagnant economy, where everyone is cautious and conservative, has all kinds of negative downstream effects.”
…According to economists and executives, the labor market won’t thaw until employers feel confident enough about the future to begin hiring at a more normal pace. Six months ago, businesses hoped that such a moment would arrive in early 2025, with inflation defeated and the election decided. Instead, the early weeks of Donald Trump’s presidency have featured the looming threat of tariffs and trade wars, higher-than-expected inflation, rising bond yields, and a chaotic assault on federal programs. Corporate America is less sure about the future than ever, and the economy is still frozen in place.
Quote of the day:
“Starting on day one, we will end inflation and make America affordable again, to bring down the prices of all goods.”
~ Donald Trump
Note: We’re on day 42. We Need to Talk About the Lying: “Donald Trump’s past behavior tells us that he is a liar who will say whatever he needs to get a vote.”
What I’m reading today…
The Stock Market Was One of Trump’s Favorite Talking Points. Not Lately.
The S&P 500 has since fallen almost every day, and the index is now lower than it was when Mr. Trump took office on Jan. 20. Other indexes, including those more closely tied to the ebb and flow of the economy, have also fallen. On Friday, the S&P 500 surged higher late in the day but remained lower for the week, its second consecutive week of losses for the first time since October. Other bullish reflections of Mr. Trump’s election have also faded, with Bitcoin tumbling roughly 20 percent over the past month. While it is only less than two months into the new administration, the market is showing signs of weakness, as investors have become increasingly nervous about an impending sell-off.
Why are CEOs having second thoughts about Trump?
The stock market has dropped since President Donald Trump took office, while both consumer confidence and consumer spending dropped in January. Trump's on-again-off-again tariff threats have made it impossible for business leaders to make plans….It took just a month for the new administration to "cool the enthusiasm of chief executives and dealmakers," said The Wall Street Journal. The uncertain environment is making corporate leaders hesitant to pull the trigger on big deals. For that to turn around, "CEOs will need to find more comfort than they have today."
Trump can’t fulfil his promise to fix the economy, so he’s blaming workers instead
During his presidential campaign, Donald Trump never missed an opportunity to harp on inflation, promising that “on day one” he would “end inflation” and lower the costs of groceries, cars and other common goods. Well, it’s day 40, and inflation saw its largest increase in over a year. Blink and you might have missed that Trump and his fellow Republicans have largely abandoned their concerns about inflation to focus on government “waste”. While Trump hasn’t fulfilled his campaign promise, he is living up to his usual brand of politics: the blame game. And this blame, as usual, is rooted in generating anger against “undeserving” Americans. Trump pits immigrants against other working people. But we have a common enemy. This time, the undeserving are federal workers and poor people who get nominal benefits from the federal government – like Snap, which administers food stamps, and Medicaid.
The goods and services that matter to us - it's food. It's transportation to work. It's health care. How much does it cost to rent or have a home? If you look at the numbers that really matter to you, they have been inflating over the last 20 years more than the CPI. The second thing that really is a fooler is when a political figure announces that the rate is coming down, that doesn't really matter if it already spiked so high that the goods and services we have to buy are at a price point we can't afford.
A number of people that voted for Donald Trump, and in my state, some of whom also voted for me, they expected that he was going to be a change maker, not for chaos, not for corruption, but they wanted him to do something on their costs. That includes housing and child care and health care. And they’re just not seeing it. And instead, they’re seeing the opposite. The way they have been creating chaos and getting rid of things that matter to people, whether it’s cancer research or whether it is their local park ranger or farm loan officer, this is not what they signed up for.
Business groups quietly push back on Trump's immigration raids
Critics see the White House's plan as leading to an exodus of workers in jobs that many Americans don't want to do, resulting in lower productivity, higher prices and a damaged economy. "The long-term impact will be where housing prices are already too high in places like Arizona," said Sen. Mark Kelly (D-Ariz.). "When they can't get the workforce to build the houses, the prices are going to go up and rents are going to go up."
Republicans don't care about fixing the economy.
The GOP electorate voted for a reactionary response to the Biden administration. The early weeks of the second Trump administration have been dominated by culture war executive orders, Elon Musk's cost-cutting antics and Trump trolling Democrats as much as possible. The core MAGA voters are probably thrilled by what's happened so far. That's what they wanted. None of that will help improve the economy. In light of January’s surprisingly high inflation numbers, which Trump has declined any responsibility for, Americans have renewed their concerns and, by connection, their desire for something to be done.
Trump Wants to Kill Clean Energy. He’s Too Late.
Trump has inherited a strong energy economy from the Biden administration. America is producing more energy — including oil, gas, wind and solar — than at any other point in history. Exports of oil and gas are also at record highs.
Over the past 20 years, America’s greenhouse gas emissions have dropped through increased efficiency and as wind, solar and natural gas have displaced coal in the power sector. America’s total annual energy consumption has stayed level for over two decades, despite the economy nearly tripling and the population growing about 20 percent. It will be hard for him to disrupt that momentum.
What Kind of World Do Silicon Valley Billionaires Want to Create?
Antitrust is a part of it. The threats of crypto and AI regulation are a big part of it too. There’s bitterness. But I also think, like Rockefeller, Musk and Jeff Bezos and others are, above all, relentlessly focused on their businesses. And over the past several years, they spent a lot of time and money trying to appease their critics in the government and the media, and among their own workers, which is something they never had to do before.
The ‘Exciting Business Opportunity’ That Ruined Our Lives
For some Americans, joining the business might have been harmless. For us, it was not…Within three years, we were living in a filthy house without electricity, eating food out of a cooler that we kept filled with ice. Then we were evicted, and my mother and stepfather declared bankruptcy. Ordinary people might have thought twice about sticking with Amway. But by that point, we had left the small dreams of ordinary people behind… Sometimes I meet people who thought about joining Amway, and are relieved they never signed up. Sometimes they’re surprised that Amway still exists—they thought it disappeared decades ago. Most barely know what it is. ..But whether they know it or not, Amway has deeply influenced American politics for decades. In 2021, Doug Wead died. At the time, he was under federal indictment—not for anything related to Amway, but for allegedly funneling Russian money into Donald Trump’s 2016 campaign. In Trump’s first administration, he nominated Betsy DeVos as secretary of education. An advocate for school choice and religious education, she is married to Rich DeVos’s son, Dick, who was president of Amway himself in the 1990s, and whose family still co-owns the company. She said she’d be open to returning to the post, “with the goal of phasing out the Department of Education.” The rallies leading up to Trump’s latest election, with their euphoric resentments and tent-revival energy, recalled nothing so much as a 1980s Amway function.
What I am listening to…
For years, Wall Street veterans have been saying that a market correction is around the corner, and last week's jitters have only intensified concerns. To find out if the party is ending sooner rather than later — and what role Trump’s policies will play — Kara talks to the Dean of Valuation, Aswath Damodaran. He and Kara discuss valuations, DOGE, tariffs, mass deportation, and tech stocks and much more.
What I am watching…
“The uncertainty coming out of Washington is causing businesses to slow down…”
A sad commentary is that I am pleased the Consumer Confidence is falling - at some point that must translate into votes.