Just How Did Trump Borrow All That Money?

Watching Empires of New York on CNBC (good series by the way) and one of the features is Donald Trump in the 80's.

He bought fancy hotels (Plaza Hotel), built over-the-top casinos (Taj Mahal), developed condos and office buildings (Trump Tower and 40 Wall St) using junk bonds with interest rates as high as 14%. 

He made risky and unsustainable investment bets. He didn't seem phased to walk away when shit hit the fan. 

How did Trump have confidence to do this if he had equity (i.e. something to lose) in the project (or was it 100% debt financing)? How was he able to borrow so much money that big banks [at the time] literally couldn't allow him to fail? 

I have some investment properties, but my banks required 25-40% equity with a personal guarantee. No non-recourse. And my properties are multifamily and small office buildings, nothing volatile like hotels, restaurants, or retail.

 

Have you seen some of the LBOs that were done over the same period?  You said it yourself, junk bonds which were in their hayday and the real estate market rules were completely different.  

"The obedient always think of themselves as virtuous rather than cowardly" - Robert A. Wilson | "If you don't have any enemies in life you have never stood up for anything" - Winston Churchill | "It's a testament to the sheer belligerence of the profession that people would rather argue about the 'risk-adjusted returns' of using inferior tooth cleaning methods." - kellycriterion
 
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My personal favorite due to it being such a blatant yet awe-inspiring abuse of government connections is William E. Simon's LBO of Gibson Greetings.  Guy abused his connections from being the Secretary of the Treasury under Nixon to get absurd loans approved, ones that would probably make even Trump envious.  From the wiki

Simon was a pioneer of the leveraged buyout (LBO) in the 1980s. Following government service, Simon was a Vice Chairman at Blyth Eastman Dillon for three years, He and his partner, then co-founded with Ray Chambers, a tax accountant, Wesray Capital Corporation (Simon contributing the "Wes" and Chambers contributing the "ray" based on his initials), an LBO firm that bought and sold, among others, the Gibson Greeting Card Company, Anchor Glass, and the Simmons Mattress Company, typically investing tiny fractions of their own money and including significant debt to complete the purchase from prior shareholders, and then selling the companies whole or piecemeal after making changes that "often included job cutbacks and other short-term cost-reduction measures.".9 In 1982, Wesray invested approximately $1 million in equity capital (with Simon contributing $330,000) and borrowed another $79 million to take private a Cincinnati-based greeting card company, Gibson Greetings, for $80 million. Eighteen months later, the company was taken public again, with a value of $290 million, and Simon's $330,000 investment was worth $66 million.

"The obedient always think of themselves as virtuous rather than cowardly" - Robert A. Wilson | "If you don't have any enemies in life you have never stood up for anything" - Winston Churchill | "It's a testament to the sheer belligerence of the profession that people would rather argue about the 'risk-adjusted returns' of using inferior tooth cleaning methods." - kellycriterion
 

Hic atque autem quasi dicta. Est et ducimus laudantium id ipsa. Sapiente vero rerum repellat ipsa. Modi quas porro et unde iste.

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