The Viper Room - NO SCRUBS

[Stavros]

"They show that, between 1985 and 1989, a period when the economy was forging ahead and Trump was busy portraying himself as a billionaire with the Midas touch, his core businesses—apartment buildings, hotels, and casinos—somehow managed to lose $359.1 million. That was only the beginning. As the economy weakened, in 1990 and 1991, Trump’s core businesses racked up losses of $517.5 million. And, between 1992 and 1994, as the economy recovered, they lost another $286.9 million."

I think we can agree that there are people like Trump who are barely literate, but are good with numbers. But when he boasts about knowing more about the tax system than anyone else, he is really paying trbute to the lawyers who have helped him 'game the system'.

The point is that if you create a successful business, then it stands to reason that the more revenue and profit you make, the higher the tax bill, though the point of having tax lawyers is to whittle down the IRS demand to as low as possible- Joseph Stiglitz has argued that whatever the official Corporate Tax rate is, large corporations rarely pay more than 10%. But such are the bankruptcy laws in the US, it can pay to fail, as has been pointed out here-my emphasis in bold

"Since the 1970s, bankruptcy law has developed in a contradictory fashion in the US: while laws and norms against individual and national bankruptcy (also known as default) have grown more stringent and punitive, norms and laws governing corporate bankruptcy have become more lenient. Famously, in the US, one cannot default on student loans, but it is common for corporate leaders to walk away from business failure at a profit.
For decades, we have lived in an era of “strategic bankruptcy” which allows management to file for what is called “Chapter 11” to default on contracts and promises without foregoing leadership of the company itself. Bankruptcy is less a private apocalypse than a canny business move."
https://webcache.googleusercontent.c...&ct=clnk&gl=uk

It is hardly ironic that a man who claims to be a business success may have made more money on tax rebates than he may have made creating a successful business, but as long as the law privileges failure then it is there to be exploted. The reality is that Trump may be worth $3 billion in his own estmation, but that is a calculation of total assets rather than performance, and to get a more realistic figure one would have to deduct the money he owes in loans, mark up the chronic losses of his 15 golf courses, his numerous hotels and apartment blocks, to leave him making money from trademarks.

And, because he knows how the law works, he can spin the legal cases out for years on the assumption that his adversaries will eventually give up in exasperation and 'make a deal'. The most vulnerable, as I see it, are the payments made to the porrn stars, though I doubt it leads to gaol time.

If you have a system that rewards failure, don't be surprised if a giant failure exploits it to present himself as its opposite, just as there are many other brands than Trump Vodka and Trump Steaks, and only a complete idiot would apply for a job citing a degree from 'Trump University' -he is a shameless con-man, and not enough people care to remove him from political life, and make him pay his debts.

[Nick Danger]

Nick, I actually appreciate that you will argue the right-wing point of view, with the exception of the stuff I consider conspiracism. While I can't stomach the Sandy Hook stuff, I'm happy to talk Trump's loans and other stuff here.

I know a bit about business and know some people in commercial real estate. I guess I am a bit reluctant to share too much. You're right that people threaten bankruptcy to get better loan terms. They present the best aspects of their personal finances to get loans and for tax purposes present a softer picture.

I am a lawyer and although you said everyone hates us some people like me. While tax accounting is different from financial accounting there are limits to what people can do when representing income to investors.

All of this is to say, I would know a lot more if I saw Trump's disclosures to Deutsche Bank. You think it will be consistent with playing the game or on the edge of legality. I'm not sure but by the time anything comes of it we'll get a sense of whether it is normal industry practice or fraud.

I had you figured for some kind of professional, just like I have Flighty figured for either a Chippendale dancer or just possibly, Tipper Gore.

Wouldn't surprise me at all if you know more about the business world than I do. I know how to run my business, and I know how a few other people run theirs.

So we can say you're right. Still, Trump has obtained business loans. Large ones. From professional lenders at prestigious institutions. And I'd be surprised if there were any criminal irregularities there that have been overlooked.

But the stories I've heard about the way Trump does business are not about banking. They are mostly about contracting. I've heard he will hire a contractor to, let's say, carpet the foyer of one of his buildings. Then when it's time to pay for the work, he will find something wrong with the work - frayed edges, not the exact color he wanted, loose corners, too thick, whatever. He will then offer the contractor less than the agreed amount, claiming the work isn't up to snuff, and threaten to take the contractor to court if he doesn't accept the lesser amount. The contractor, being in no position to battle Trump's army of lawyers for years over a few thousand dollars, ends up accepting the lower amount, and Trump gloats all the way to the bank.

Is that illegal? No. Immoral? Certainly a very dingy gray area of the moral spectrum, but the saying "All's fair in business" comes to mind. Is it clever? Not really, anyone with balls, money, and lawyers could do it. Profitable? Probably very much so. Is it true? Wouldn't surprise me if it is but it could also be an exaggeration of true stories about borderline contractors.

The question arises though, why do people still work for Trump? I mean, you tell me. There must be someone, somewhere, making money by working for Donald Trump, or no one would do it. I wouldn't build a turbocharger for a guy with a reputation like that, let alone undertake a huge contract for him. But people do. So why?

I said solvency but you're saying liquidity is more important. That's fine. I have a feeling Trump's casinos were facing insolvency and not a liquidity crisis but I don't know.

There's a difference between negotiating a bank loan for real estate and people buying business inputs or even inventory. If they are buying something that's a staple of their business the relationship is ongoing and those goods are often bought on credit anyway. But that is a relationship where there's give and take. Trump is in the commercial real estate business so I imagine he has a closer relationship with banks than the average person.

BUT when banks lend money to people it's not supposed to be a super risky investment. They get near certainty of payment but a capped upside. That's the nature of debt. I doubt the re-negotiation was only over the timing of Trump's payments. It may have been in the nature of "you can either accept smaller payments or you have to run these casinos that are losing money and since you're not in the business of running casinos....."

All of this is to say, maybe he lied to get his more recent loans or maybe he got money from a shady source or some kind of shady transaction generally.

Obviously my business is small potatoes relative to Trump's empire. Liquidity is what drives my billing cycles sure, but I feel my view of liquidity encompasses all levels of business. Basically, the longer I have your money, the better for me, and I'm pretty sure that holds true right up the line. Within reason. While I'm holding your money, someone else is holding mine. I've been brushed off for 6 months at a time before, by HUGE corporations, but I've never, ever put any of MY creditors off for 6 months. Like I said, I'm a business bottom. I'm the little guy, I certainly do not have an army of lawyers at my disposal. I have one, and he's pretty good, but to say he's "at my disposal" would be to ignore the fact that he has about a dozen other clients.

But you know, it all comes down to leverage. I'm a good actor. Whatever threats I might make or imply are just that, threats. But you cross a guy like Trump and you will find yourself in an actual courthouse.

And again, you're saying banks don't make super-risky investments, and I absolutely agree with that. So why do they lend to Trump? I guess what you're saying is, you suspect he does something illegal to obtain the loans. I suppose we'll see about that soon enough, according to Trump, the New York DA is looking at every single transaction he's ever made. I just find it very difficult to believe that if there's truly all this dirt out there on Trump, it hasn't been dug up before now.

https://www.newyorker.com/news/our-c...were-very-real

"They show that, between 1985 and 1989, a period when the economy was forging ahead and Trump was busy portraying himself as a billionaire with the Midas touch, his core businesses—apartment buildings, hotels, and casinos—somehow managed to lose $359.1 million. That was only the beginning. As the economy weakened, in 1990 and 1991, Trump’s core businesses racked up losses of $517.5 million. And, between 1992 and 1994, as the economy recovered, they lost another $286.9 million."

Well, the guy can't keep losing hundreds of millions of dollars a year and still afford those suits, can he. He's got to be making money somewhere, even if he's losing it elsewhere. "How rich is Trump?" is certainly a question, but "Is Trump rich?" isn't.

[broncofan]

Nick, this aspect of the conversation is fun because we get to chat about business and the Trump empire. I'll get back to this later, but I do think Trump is a billionaire. I'm not saying he isn't rich. I think he needs to get his loans re-financed which is the case for everyone in real estate because of the way commercial loans are structured. Many I've seen are 25 years amortization 10 year term, or importantly a longer amortization schedule than term and a balloon payment. Investors avoid the balloon payment by refinancing.

So just to clear that up, I don't think he's underwater. I think not getting re-financing would shake up his business a lot but I think he should be able to find it somewhere. But that somewhere is the question and how and on what terms.

[broncofan]

This isn't to our main point but I'll just say I think the stuff with contractors is unethical. In contracts, there is the concept of substantial compliance. It means that you don't get to claim breach and withhold payment if there is something trivial about the difference between the end product and what is specified in the contact. The requirement of "consideration" in contracts is actually there to prevent people from trying to re-negotiate contracts while their terms are being met. If the person did sue Trump later, and Trump claimed the person agreed to a contract modification by accepting the lower amount of money, the court may hold the modification did not to satisfy requirements for a new contract because Trump didn't offer anything obtain this modification. But as you say these are people who can't afford counsel and our system is not a loser pays legal system like they have in the UK. For cases like this certainly you wish it were.

In your paragraph about having an incentive to hold money for a longer period of time, that's actually the essence of most tax planning. I only took two tax courses, but before I took them I always thought tax planners were able to reduce taxable income overall. While that sometimes is the case, much of the game is to defer recognition of revenue, accelerate recognition of deductions. This is to take advantage of the time value of money. It's better to pay 500,000 to the irs over 5 years than in year 1 because of what you can do with the money in the meantime. For corporations this difference is worth millions of dollars.

[broncofan]

I suppose I just don't understand why it's so important to your political arguments that you're doing well. It reminds me of when Bill O'Reilly was telling everyone how nobody had it harder than him coming up and they found out he went to private school or was middle class. There's actual data on economic and social mobility in this country. If you've done something it doesn't mean anyone can. These anecdotes always end up favoring your argument too which is easy to happen. I've thought of things that have happened to me and it's easy to finagle a version that makes poor people seem lazy or sick people seem weak or negligent. Or the opposite. It's also easy for the anecdotes to relate to real events but what if you're in the foreground or the background or it's kind of hazy because alcohol does that. You remember James Frey?

In case there have been too many thoughts, here is the last one. It's not that I'm that skeptical about everything though I have doubts about whether you're telling us these things objectively. I have doubts about its relevance to any political argument. That's where we are.

[Nick Danger]

In case there have been too many thoughts, here is the last one. It's not that I'm that skeptical about everything though I have doubts about whether you're telling us these things objectively. I have doubts about its relevance to any political argument. That's where we are.

I don't know why you argue politics on the internet, Bronco. I'm not saying you do it poorly or do it well (occasionally you give me a nice sensible chuckle) but I don't know why you do it. Since your motivation is a mystery to me, your arguments hold less weight than if I knew from whence they arise. Oh I'll still argue with you. But unless you startle me with some insightful clarity that hadn't previously occured to me, you're not going to change my mind about anything.

I argue politics to win. I WANT to convert liberals to conservatives. I'm in business. Not only am I in business, but my business goes the way of the economy. I sell a luxury item that's not even a luxury for wealthy people, it's a luxury for teenagers and the working class. You think if John Q. Public is struggling, he's debating with his wife over whether to get that turbocharger for his late-model used Mustang or paying that month's mortgage. Uh-uh, more like he's not thinking about that turbocharger AT ALL.

So I'll tell you who I am and why I know what I'm talking about. Because I want to win the argument. I know winning an internet argument isn't going to happen like, "Oh shit, that's true, I guess you win." But if I say something that rings true, and someone reads it, they're going to remember it, and it's going to factor into their decision-making at some point. Or at least that's the hope.

I read an interesting story about cereal recently - OH SORRY, before I start that story let me answer your question about my anecdotal evidence! Does the story fit the argument, or is the story MADE to fit the argument is the question on your mind, yes? They fit. I don't know how else to tell you that my stories are all 100% truth, with some occasional artistic license taken for literary effect. It just so happens that I'm old and I've led a moderately interesting life. It was MUCH more interesting when I was irresponsible BTW. But the way it usually happens is these stories just occur to me mid-conversation - something you say reminds me of something that happened. You're welcome to take them with a grain of salt if you want, I'm not writing an autobiography here. I mean, you told me you're a lawyer. I could say, "I don't believe you, you sound like an inventory clerk." Or I could just do what I have done, which is to simply take you at your word unless you start accidentally spouting a bunch of obvious inventory clerk jargon.

So I read an interesting story about cereal recently. It was talking about the huge role cereal played in changing the culture of advertising in this country. Apparently, back in the Civil War era when cereal flakes were invented somewhat by accident, they quickly became a hot business. They were easy to make, easy to sell, and high-profit. At one point, there were 70+ brands of corn flakes on the grocery shelves of the USA. And if we're being honest, one corn flake is pretty much as good as the next.

In a business like that, advertising was going to be the key to success. The two people who rose to the top of the cereal business approached advertising in different ways. Charles Post hired a young Walt Disney to create eye-catching cartoon characters on his packaging, and sold a lot of corn flakes that way. Dr. John Kellogg, on the other hand, advertised his history as a renowned surgeon and health guru to sell essentially the exact same product.

The reason that's relevant to what I'm saying is that I can't draw cartoons. So instead, I have to tell you who I am - a business owner with skin in the game.

[broncofan]

I mean, you told me you're a lawyer. I could say, "I don't believe you, you sound like an inventory clerk." Or I could just do what I have done, which is to simply take you at your word unless you start accidentally spouting a bunch of obvious inventory clerk jargon.
.

I was debating someone here a few years ago and the person said that they're a lawyer. I said I also am. Their first reaction was to suggest I was making it up and then they told me they passed the bar on the first try. I didn't have to question whether they were really an attorney because I met someone once who said that to me and I remembered thinking "this person actually thinks it's noteworthy that he didn't fail the bar." Some smart people have failed the bar but it shouldn't happen that often. He was one of these guys who when he made an awkward comment would snap his fingers and clap his hands as though he said something cool. My point is that there are a lot of law schools and most people who take the bar pass it.

It's a lie that wouldn't profit anyone to tell given that lawyers aren't held in high esteem, that if anyone assumes lawyers are usually smart they're wrong, and being a lawyer still means that if a random area of the law comes up there is a greater than 90% chance that it's not something I know off the top of my head. In fairness I went to a highly ranked law school (I get to say that after running down the significance of being a lawyer) but we all get licensed by a state bar and share the same profession as Sidney Powell or Michael Cohen.

What you're talking about is argument by authority though. Yet it IS possible for a non-lawyer to be right on a legal issue and for me to wrong. Fred41 corrected me on a criminal law issue a bunch of years ago and sheriffs deputies didn't show up at my door to revoke my license.

[broncofan]

Correction: Michael Cohen was disbarred. But at one point he was a lawyer. He went to a school called Cooley Law School, which has an average lsat score of 145. I am not being elitist or indirectly complimenting myself but if anyone thinks it's difficult to become a lawyer they can buy an lsat practice book and find out how hard it is to miss enough questions to get a 145. Yes, Cooley graduates still have to pass the bar and the school temporarily lost its accreditation because not enough of them did in one year.

Top list of lies I'd tell if I were inventing a profession (ala George Costanza with the architect thing)
1. Microbiologist
2. Cardiac Surgeon
3. Dermatologist
4. Chemistry Professor
5. Pornstar

This is just off the top of my head.

[broncofan]

double post;

[Nick Danger]

I was debating someone here a few years ago and the person said that they're a lawyer. I said I also am. Their first reaction was to suggest I was making it up and then they told me they passed the bar on the first try. I didn't have to question whether they were really an attorney because I met someone once who said that to me and I remembered thinking "this person actually thinks it's noteworthy that he didn't fail the bar." Some smart people have failed the bar but it shouldn't happen that often. He was one of these guys who when he made an awkward comment would snap his fingers and clap his hands as though he said something cool. My point is that there are a lot of law schools and most people who take the bar pass it.

It's a lie that wouldn't profit anyone to tell given that lawyers aren't held in high esteem, that if anyone assumes lawyers are usually smart they're wrong, and being a lawyer still means that if a random area of the law comes up there is a greater than 90% chance that it's not something I know off the top of my head. In fairness I went to a highly ranked law school (I get to say that after running down the significance of being a lawyer) but we all get licensed by a state bar and share the same profession as Sidney Powell or Michael Cohen.

What you're talking about is argument by authority though. Yet it IS possible for a non-lawyer to be right on a legal issue and for me to wrong. Fred41 corrected me on a criminal law issue a bunch of years ago and sheriffs deputies didn't show up at my door to revoke my license.

I don't think there's a right or wrong in political debate. People sometimes get facts wrong but it's essentially a philosophical debate, which is always an argument from authority.

The two opposing philosophies in American politics really boil down to one question when all the bullshit is set aside - is it better to give money to the poor, or to force them to become better citizens by not helping them?

I know a guy, perfectly good American citizen, able-bodied, able-minded, no criminal record, who has been on unemployment since the pandemic started. He was in the repo business but the company he worked for folded under the pressure of the pandemic, so he started out as laid-off but now is for real UNemployed. I asked him not long ago how the job search was going and he told me he's not looking anymore, said he'll start looking again in SEPTEMBER! Reason: Because he makes more money on unemployment than he did repo'ing cars, and his unemployment benefits just got extended to Sept. 30.

He's not a bad guy, I even consider him a friend. But look at him now. Sucking government tit for as long as they'll let him. Pitiful. He's lost my respect and probably a lot of other people's, but that's not as important to him as the fact that he doesn't have to work anymore.

Point being, you give people the opportunity to sit on their ass all day and they'll take it. Real conservatism squashes that option. Guaranteed that if this guy wasn't getting $900/week of taxpayer money, he'd be working at something productive, contributing to the GDP instead of sucking it down.

I get that this is a unique situation, the pandemic. Still doesn't change the fact that this guy could be working but is choosing not to, for no better reason than that he doesn't have to.

And that's where the philosophical argument begins. I guess some people are just fine with that - people who haven't given the matter enough thought, people who can't do simple math, people who don't understand how the economy works and/or doesn't, people who don't realize that human nature is a real thing. You know, Democrats.