• Business
    Associated Press

    Trump facing devastating debt load? Experts say not so fast

    President Donald Trump reportedly must pay back more than $300 million in loans over the next four years, raising the possibility his lenders could face an unprecedented situation should he win a second term and not be able to raise the money: foreclosing on the leader of the free world. Based on Forbes magazine estimates of the value of his buildings, for instance, selling his partial interests in just two properties— an office complex in San Francisco and a Las Vegas tower that houses a hotel and condos — could bring in $500 million alone. Trump’s true financial picture has gotten renewed scrutiny in the wake of a New York Times report this week that he declared hundreds of millions in losses in recent years, allowing him to pay just $750 in taxes the year he won the presidency, and nothing for 10 of 15 years before that.

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  • Politics

    Trump Paying $750 in Income Tax Shows Why He’s a Billionaire

    (Bloomberg) -- A New York Times story based on Donald Trump’s long-sought-after tax data shows he avoided paying income taxes for most of the past two decades and paid only $750 the year he was elected president.That doesn’t mean he isn’t a billionaire.By pairing moneymaking businesses with spectacular money-losers, the Trump Organization has been able to shield profits generated by office properties and “The Apprentice” from tax collectors. It’s a souped-up version of the formula deployed by America’s landlord class for decades. But tax losses are different from operating losses, and the new data don’t necessarily show his business empire is heading into crisis, even if it’s carrying sizable debts.“Your tax return at the end of the day shows income and whatever deductions are claimed against that income. That’s it,” said Thorne Perkin, president at Papamarkou Wellner Asset Management. “It doesn’t necessarily show net worth.”The newspaper’s report described the extent of Trump’s tax-cutting strategies, such as taking deductions for consulting fees to his daughter and for hairstyling, which resulted in paying far less than poorer Americans. Although the report raises questions about the legality of some of the maneuvers, the new details don’t affect the Bloomberg Billionaires Index estimate of his wealth. His net worth is based chiefly on the value of his office and commercial property holdings, minus debts that were already known. The index estimated his net worth at $2.7 billion as of August, down $300 million from mid-2019, hurt by declining prices for certain types of real estate holdings.Trump’s office properties include commercial spaces at Trump Tower, a leasehold on 40 Wall Street in downtown Manhattan and a 30% interest in two office towers co-owned with Vornado Realty Trust. Collectively, the assets are valued at about $1.9 billion, and Trump’s share of the debt that encumbers them is about $670 million -- meaning they constitute almost half of his net worth.Financial records for his golf courses in Europe have long shown that, after including items such as depreciation, they run in the red. The tax data obtained by the Times reveal Trump’s American golf courses operate similarly.Depreciation is crucial for real estate investors. Depending on the type of property at hand, they can write off a portion of its value over a useful lifetime pre-determined by the Internal Revenue Service. That allows investors to claim tax losses on the property even when they’re putting money in their pockets.“You want to show as much losses as you possibly can for your deductions,” said Papamarkou’s Perkin. “That’s a big part of the advantages of real estate investing.”The president’s son, Donald Trump Jr., disputed the Times’s reporting on Tuesday while acknowledging that Trump exploited depreciation, tax credits and other provisions of the tax code.“He’s paying tens of millions in taxes -- now, he’s not going to pay more” than he needs to, the president’s son said in an interview on Fox Business Network. “And by the way, he’s following the tax code that people like Joe Biden, who has been in DC for 47 years, have written. He’s playing by their rules. Joe Biden is taking advantage of the same loopholes.”The Times in a Monday story also revealed that when Trump did pay taxes it was because of cash from his role fronting “The Apprentice” and not as a real-estate developer. He earned $197 million from the show and $230 million from branding, speaking engagements and licensing deals off the back of the fame the series provided. As well as borrowing against Trump Tower and selling stocks and bonds, he plowed some of that money into the money-losing golf courses.Carrying LoansThe tax documents described by the Times aren’t enough to draw conclusions about the profitability of Trump’s empire. But even if his golf courses are bleeding money, they contribute comparatively little to the tally of his fortune -- about $430 million before debt. Prices for golf resorts are down after years of decreasing interest in the sport. Younger generations simply aren’t taking it up as quickly as their elders are leaving it behind.Trump has long been required to disclose a road map to his assets and liabilities. In 2015, then a contender for the Republican party’s nomination for president, he released a financial disclosure listing the lenders behind his loans, ranges for their outstanding balances, when they were issued and when they must be repaid.That several are due in the next few years isn’t unusual in commercial real estate, where most loans run five to 10 years and are refinanced regularly. Unless there is a serious deterioration in the performance of his properties, it’s likely his portfolio can be refinanced before loans mature.Though Trump has carried on this balancing act for years, his re-election could make obtaining new loans harder if potential lenders don’t want to face the prospect of foreclosing on a sitting U.S. president. Conversely, Trump is engaged in a variety of court fights that could accelerate once he leaves office and complicate refinancing. The Covid-19 pandemic also may take a lasting toll on the value of his holdings, making future loans more onerous.His biggest financial vulnerabilities remain his hotel in Washington, where the pandemic has slowed business, and Doral, a sprawling golf resort in Florida. He has taken out nearly $300 million of personally-guaranteed loans from Deutsche Bank AG against these properties. The debts mature in 2023 and 2024, according to his personal financial disclosure.Room to BorrowBut Trump, whose earlier career included a series of bankruptcies, also has a safety valve: the office properties.When he refinanced Trump Tower in 2012 with a $100 million loan, it was appraised at $480 million. A 2015 refinancing of 40 Wall Street fetched a $160 million loan on a $540 million appraisal.That left both properties relatively low-levered for Manhattan real estate, suggesting either a newly learned financial conservatism on Trump’s part or a squeamishness on the part of the lender, Ladder Capital. Ladder, which specializes in loans for commercial property, is Trump’s second-biggest lender after Deutsche Bank.An August appraisal of the buildings by the Bloomberg Billionaires Index, based on current net income and prevailing capitalization rates, was less sanguine, valuing them at $365 million and $375 million respectively. But so long as the pandemic doesn’t crater office values, the properties could carry far more debt, were Trump to need it.(Updates with comments from Trump’s son in 10th paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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  • U.S.
    The Telegraph

    Wyoming appeals for hunters to visit the state and shoot wild goats

    Wyoming is appealing for hunters in the United States to visit their state and shoot as many goats as possible, in what one official termed "every hunter's dream". The 100 mountain goats in the Grand Teton National Park are considered by state and federal officials an invasive animal, and a threat to the region's bighorn sheep. For years conservationists, land management experts, National Park officials and the state wrangled with the problem. In 2018 they agreed to a plan which would rely on aerial sharp shooters, controlling the population from helicopters. A helicopter was sent to kill the mountain goats in February, and the gunmen on board managed to shoot 38 goats - a third of the population - in one day. Shortly thereafter, however, the helicopters were indefinitely grounded owing to complaints from the governor, and the goat elimination programme suddenly paused.

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  • Business
    Yahoo Finance Video

    Job market will be 'catastrophic' with 41% of people laid and off likely not getting their jobs back: Author

    Michael Solomon, 10x Management Co-Founder and author of "Game Changer: How To Be 10x In The Talent Economy" joins the On the Move panel to discuss how to identify, and retain talent that will make a difference in the work world of tomorrow.

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  • Science
    Business Insider

    After measuring radiation on the moon for the first time, scientists say a lunar base should be built underground to protect astronauts

    Astronauts didn't measure how much radiation they were exposed on the moon. New data show the doses are 200 times higher than on Earth.

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