Posted on 01/25/2016 2:44:59 PM PST by Zhang Fei
As "really rich" as Donald Trump is today, he might have been even richer if, instead of dabbling in skyscrapers and casinos, he'd simply taken his eight-figure inheritance decades ago and sunk it into the stock market.
Had the celebrity businessman and Republican presidential candidate invested his eventual share of his father's real-estate company into a mutual fund of S&P 500 stocks in 1974, it would be worth nearly $3 billion today, thanks to the market's performance over the past four decades. If he'd invested the $200 million that Forbes magazine determined he was worth in 1982 into that index fund, it would have grown to more than $8 billion today.
Even the smaller figure exceeds the lower range of his possible net worth as reported to the Federal Election Commission, while the larger number exceeds by billions recent estimates of Trump's worth by financial publications. And it would have come without the high-drama, roller-coaster career that has included four corporate bankruptcies.
That a purely unmanaged index fund's return could outperform Trump's hands-on wheeling and dealing calls into question one of Trump's chief selling points on the campaign trail: his business acumen.
(Excerpt) Read more at nationaljournal.com ...
How much has he spent thus far? He said a few weeks ago that it was practically nothing.
Putting it into the stock market IS doing something.
If every single person who started a business instead took his seed money, large or small, and instead passively invested it, instead of going into business, there would not be any businesses at all to invest in, would there? It is a perfectly honorable and intelligent thing to do, to take your inheritance and choose to create a business and devote the rest of your working life to making a success of it. What is the matter with you Cruz people anyway?
The stock market is nothing like gambling in Vegas. Apples and elephants. Of course people that think like that probably should not invest in the market.
If every businessman invested in the stock market instead of doing anything with it, imagine how rich they’d be!
Fame and fortune are two reasons men strive. Of the two, fame is more enduring. History records the names of all national leaders. Except for Croesus, even the richest of tycoons are lost in the mists of time. And Trump isn't the richest or even in the top 100.
As to what Trump intends, Bloomberg is contemplating running for office and it's probably not about the money either, since he's worth $40b, a fortune he amassed despite being the son of a lowly realtor who died just after he graduated college. All we have to go on about Trump's intentions are what he's saying this year, which is different from what he said last year, which is different from...
Henry Ford should have never went into the horseless carriage business. Would have saved us from Islamic terrorism and global warming .
Yup.
This has to be one of the stupidest articles ever posted here.
Trump created things. Without risk-takers, we’d be Canada (Lower Half).
Total BS.
Trump didn’t own the company in 1974, his father did, and for another 20 years.
How much mutual fund money have you lost or had embezzled?
Maybe Trump cared more about creating tangible products and jobs than the money?
Zhang Fei is just another spammer. Should be banned for spamming.
Many problems with this article:
1) No mention of taxes - real estate is extremely well known for having tremendous tax benefits. All of those hypothetical stock market gains (if realized) would’ve been subject to capital gains taxes, and dividends would be taxed every year.
2) If he was worth $40 in 1974 and $200 million in 1982, then it would appear that Trump did a bang-up job managing his money. The article isn’t consistent - it should stick with the $40 million from ‘74, when Trump actually got unfettered control over his share.
3) No mention whatsoever of trusts set up for his kids. While technically not part of his worth (actually, that is the whole POINT), those trust funds are every bit as much something that he built up as that part of what he retained for himself. How much are they worth?
4) There’s also no mention of what he gave up to Ivana and Marla in divorce settlements. Again, even though not his, he certainly produced whatever it was that they received.
5) Then there’s the unmentionable - what has he hidden overseas that isn’t subject to taxation, and which is NEVER mentioned? Perhaps zero, and perhaps billions. None of us will ever know, but there are a LOT of smart operators who have skimmed here and there from cash flow that isn’t taxed to have a safety net somewhere that is completely beyond the grasp of any creditor. Again, there’s no way to know if Trump even secreted one thin dime away, or billions, but the article doesn’t even try to touch this with a 10-foot pole.
Now, that all said, Trump IS prone to exaggeration. Still, the guy is probably worth about $5 billion (assuming that he doubled the true value), which is considerably ahead of the $3 billion that the author says his 1974 inheritance should have grown to by now. Oh, FYI, those owning illiquid assets like real estate, etc. have NEVER been able to precisely calculate their net worth - it isn’t possible to know what a building is worth until it is actually sold (or, at least, until a firm offer from someone with the money to back it up comes in).
IOW, this is a pretty meaningless piece, and a not very well thought out one, at that.
His Chapter 11 creditors shared their wealth with him. The meaning of bankruptcy is that he did not return the favor.
Some people actually like to work and create things. Its very satisfying.
Exactly! Not only Canada but most of Europe too. Risk taking is out of their ken. Everything has to be guaranteed from cradle to grave. i.e. Socialism or Marxism, or communism, whatever you want to call it. That’s what the New World Order is all about. Eliminating borders and sovereignty so that a small group of elitists rule the world and everybody is exactly the same ...a cookie cutter humanity....those who are allowed to exist, that is.....
Come on. Not even a Trumper can choke down that Kool-Aid.
Oh, and here’s the biggest problem with the article - Trump’s father didn’t die until 1999, not in 1974. So what money, exactly, did Trump use to build up his net worth prior to his father’s death? Clearly, the article didn’t see that as a fit topic to discuss.
How does that country song go, something like "our lives are better left to chance, could have missed the pain, but then I'd missed the dance."
I'm sure Trump is glad he had the life he did, even if he might have been richer just sitting on the beach watching his portfolio grow.
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