RUSH: I need to add one thing, even though it isn’t gonna matter to anybody, but I have to let you know anyway. Back in 1995 the New York Times called Donald Trump “the comeback kid,” and it’s one of the reasons why he wrote The Art of the Comeback. I’m not making it up. The New York Times, which has broken the law to publish three pages of his 1995 tax return, back in ’95 called Trump “the comeback kid.”
Let me read you a portion of the New York Times article from 1995. Quote, “After the collapse of the real estate market of the 1980’s, Mr. Trump’s company was left holding some $8.8 billion in debt, causing his personal net worth to drop to a low of about $1 billion in the red by 1991.” This is the famous tax change in 1986 that took away all deductions, took the top marginal rate essentially from 70% down to 28. And, if you remember, a lot of real estate people got hammered in that, the condo market especially. Rental real estate was just devastated by it. Many, not all. And apparently Trump was one.
By the way, I remember all of that. Do you know one of the ways in which Trump was claimed to be a genius back then? It’s not just the way he negotiated with the banks. Trump had — I don’t even know quite what the terminology is here, so forgive me if I state this in less than precise terms. But what Trump had done was arrange his loans from banks so that if they foreclosed on him, they would go down, too.
Trump was the original too big to fail, in other words. And if they called his loans or if they foreclosed and took everything he had, which was then worthless because of the bubble and the financial real estate crisis, the banks would have gone with him. And so that actually led to the banks and another round of debt or underwriting, and Trump came back. So he was the original too big to fail.
Now, that phrase holds negative connotations today in terms of bailout of banks. Trump was not bailed out the by the government. Trump wasn’t bailed out like banks in 2008 were. Trump had arranged his finances with the banks so they couldn’t close him out without closing themselves down. There was a lot of criticism of Trump for that back then. I remember a lot of people were seething. They were jealous that he had been able to pull that off and tie his fortunes so exclusively to the people who had lent him money.