Speculation and the Real Estate Market Bubble

[Aman619]

hey, boys, guess what? BOTH cities suck arse. Whatddaya think a that, hah?

[The Less Blob]

I do not believe that Trump owns the land under that golf course. I think he leases it, but lists it like an asset of his. The article explained the whole thing, it looks like he made $40-$50 million in profit when comparing the cost of developing vs. the memberships he sold, which ain't bad. But he lists the whole thing as something like a $200 million asset.

 

Full disclosure: I'm rather annoyed with Trump right now because he's trying to get rid of a highway exit near my apartment that comes in very handy when I'm taking a cab home from downtown. Apparently, he's paid of the right people and it's just the neighborhood activisits who are stopping it.

[shadroch]

I'd suggest a few of you learn a bit about how finances work. How mny people claim to own their homes when in fact they have just a small amount of equity in it.

I have never owned a building that my clubs were located in,but the club was an asset that I was able to borrow against.

As for Trumps development on the West Side,it was built the way so the buyers of the first buildings did have a waterview before the other preplanned buildings went up. Had he built from the river in,they never would have had a river view and the buildings on the river would never have taken off because the whole project depended on services such as delis and dry cleaning eeking their way over from ninth avenue.

Are there other developers in NY and America worth much more? Yes,but when did Trump ever claim otherwise.

Trumps percentage of his casinos has always been on the small side. After the last reorganization it is smaller still. But so what?What percent of WYNN Las Vegas do you think steve Wynn owns?Why do you suppose successful business people are willing to pay him to put HIS name on their buildings? Do you think it just might be because it makes them more money than putting their own name on it?

I don't really care if you like him or respect him and I'm sure he cares even less,but anyone who wants to believe that he has been less successful in the real estate market than a regular Joe is deluding himself.

[Aman619]

the point is they pay him a FEE to put his name on them, and a small share of PROFITS, but in no meaningful way does he OWN THE BUILDINGS, CERTAINLY NOT 100% OF THE FANTASY VALUES HE PLACES ON THEM.. capische? (caps lock)

 

did you read the NYT article? it may not be 100% accurate, but the general structure IMO is true.

 

We who own our homes own only the equity portion after paying back the banks... but we do OWN that portion. We werent just paid a fee to market the house to other buyers.

[shadroch]

Why do you consider the prices he puts on them as fantasy?

If I have a 50 year agrement that pays me $10 million a year simply for putting my name on a building,is that building not a $500 million asset?That agreement and the sign are the asset,not the building. Is that not something I can use as collateral to obtain loans?

[Aman619]

sure, that would be a 500 million asset. But Trunps deals are nowhere near that level o fcompensation. All he gets is just the first payment and back end sliver of profits if any... but NOT an ongoing ownership stake in any of th enew developments he has his name on lately., And its not a yearly "salary" Where are you getting that example from? Definitely not any deal Trump has been offerred in 15 years!!

[Aman619]

Why do you consider the prices he puts on them as fantasy?

 

basically Im believing in the NYT article and similar articles exposing Donald over the years. Seems some people just dont want to hear it no matter how many times it gets printed. Unless its a Bring Down Donald Conspiracy???

 

The guys lives in fantasyland. Running for President??? That hair?

[shadroch]

What sort of figure do you think it would take to get "TRUMP" put on the top of a building?

$50,000 a month? A billboard on the side of the Long Island Expressway goes for more than that.

$100,000 a month? He gets more than that for a one hour speech. I doubt he would accept less than that for an office building getting to use his name.Thats $1.2 million a year,less than he gets per episode of his tv show. I'm suspecting you are not getting use of the Trump name for that.

What kind of figures does the Times say he gets?

[Silver Surfer]

Saw Trump on Mad Money tongiht with Jim Kramer. He is fun to watch when he is not so serious.

[Aman619]

What sort of figure do you think it would take to get "TRUMP" put on the top of a building?

$50,000 a month? A billboard on the side of the Long Island Expressway goes for more than that.

$100,000 a month? He gets more than that for a one hour speech. I doubt he would accept less than that for an office building getting to use his name.Thats $1.2 million a year,less than he gets per episode of his tv show. I'm suspecting you are not getting use of the Trump name for that.

What kind of figures does the Times say he gets?

 

depends on the deal. 20-40 million tops. Which is good money of course but he'd have to do 100 such deals to get to just 4 billion. And dont forget that thats his gross income! ALL his business and living expenses etc etc come out of that income, and he lives a very expensive life. So since he no longer OWNS anything with his name on it, you can see that having a net worth of 200-400 million is reasonable.

 

But a FAR FAR cry from the 8 BILLION he toots about to anyone who will listen. He is a 'liar' because he not only lists properties he DOES NOT OWN, but also inflates their worth by multiples. Think of Parrino and his Pay Copy Marvel#1. Didnt he say it was worth a million or two after he paid a few 100 thou for it? And at least JP OWNED IT!

 

Read the article. Im very curious if you will find it as convincing as I did. Its a bit short, and scratches the surface, but you can judge for yourself the fairness of it.

[Aman619]

What sort of figure do you think it would take to get "TRUMP" put on the top of a building?

$50,000 a month? A billboard on the side of the Long Island Expressway goes for more than that.

$100,000 a month? He gets more than that for a one hour speech. I doubt he would accept less than that for an office building getting to use his name.Thats $1.2 million a year,less than he gets per episode of his tv show. I'm suspecting you are not getting use of the Trump name for that.

What kind of figures does the Times say he gets?

 

depends on the deal. 20-40 million tops. Which is good money of course but he'd have to do 100 such deals to get to just 4 billion. And dont forget that thats his gross income! ALL his business and living expenses etc etc come out of that income, and he lives a very expensive life. So since he no longer OWNS anything with his name on it, you can see that having a net worth of 200-400 million is reasonable.

 

But a FAR FAR cry from the 8 BILLION he toots about to anyone who will listen. He is a 'liar' because he not only lists the values of properties he DOES NOT OWN in his personal net worth totals, but also inflates their worth by multiples. Think of Parrino and his Pay Copy Marvel#1. Didnt he say it was worth a million or two after he paid a few 100 thou for it? And at least JP OWNED IT!

 

Read the article. Im very curious if you will find it as convincing as I did. Its a bit short, and scratches the surface, but you can judge for yourself the fairness of it.

[Aman619]

What sort of figure do you think it would take to get "TRUMP" put on the top of a building?

 

 

the simple answer really is in the dynamics of the people in the room negotiating. Who's more desperate? Are they in a weak position with a bank and Donald can hold them up for a big fee AND a piece of the backend? Or is Donald a little tight that month, and they DONT need him so much, so he signs for a quick 10 mil "name rental" with NO appearances or promoting.... Who knows?

[The Less Blob]

"I'd suggest a few of you learn a bit about how finances work. How mny people claim to own their homes when in fact they have just a small amount of equity in it."

 

yes, but when one lives in a million dollar home with a $900K mortgage, one does not claim they're worth a million bucks! you're worth your equity! anyone who doesn't factor their mortgage into their net worth (as a negative) is a blithering insufficiently_thoughtful_person.

 

and you can only borrow against your equity, you can't use the 90% of the asset already owned by another bank as your collateral!

 

trump claims as an "asset" the entire value of everything, even when someone else owns 95% of it.

 

nope, i think he's a frigging fraud who has had a very good time, which is fine. he's no f-ing genius at this stuff.

 

the guy who bought the nets, ratner, now there's a guy who didn't come into the game with eight figures of mad money and he has very quietly made himself a very rich man.

[krazykat-migration]

"I'd suggest a few of you learn a bit about how finances work. How mny people claim to own their homes when in fact they have just a small amount of equity in it."

 

yes, but when one lives in a million dollar home with a $900K mortgage, one does not claim they're worth a million bucks! you're worth your equity! anyone who doesn't factor their mortgage into their net worth (as a negative) is a blithering insufficiently_thoughtful_person.

 

and you can only borrow against your equity, you can't use the 90% of the asset already owned by another bank as your collateral!

 

trump claims as an "asset" the entire value of everything, even when someone else owns 95% of it.

 

nope, i think he's a frigging fraud who has had a very good time, which is fine. he's no f-ing genius at this stuff.

 

the guy who bought the nets, ratner, now there's a guy who didn't come into the game with eight figures of mad money and he has very quietly made himself a very rich man.

 

Read 'The Art of the Deal'.....GREAT BOOK.

 

I am no Trump fan,..but the guy is pretty impressive.

 

 

kk

[shadroch]

Trump is not claiming the equity or the value of the building as an asset. What he claims is the value of his signed contracts to run,manage or simply have his name on the building.

Suppose Tump is being paid two million a year for the use of his name on a golf course,and its a fifty year deal-What value would you put on it? He doesn't own it so you don't put the value of the equity.You put the value of the contract-50(years) x$2million=100 million.

He has taken something he has no ownership anfd turned it into a $100 million dollar asset.An asset you can easily borrow against.

Sure he inflates his worth,but thats part of his hype.

 

Have you ever read The Art of the Deal? If not,I can't suggest strongly enough that you pick it up.

[The Less Blob]

$2 million/year over 50 years is not a $100 million asset!!!!!!!

 

you need to discount the income stream to its present value if you're going to assign a value to that income stream. that's economics 101.

 

and if he's managing (rather than just lending his name), there are costs to that (personnel, etc.), so he's not clearing $2 million either

[Aman619]

not only that, Trump would not live to see the end of this made up deal... and payments end with his passing. You are talking about a 50 year PAYOUT which would be an asset. But describing a fee arrangement which can only be valued AFTER its runs its full course.

 

BTW, if you were impresed with his Forbes numbers, Its no surprise you are impressed with own autobiography and all the self-promoting books he writes! Try an objective source to balance out the hype too. Its good for you, like fiber!

[Aman619]

not only that, if you are even correct in all you say, he is STILL giving the world and Forbes in particular a set of figures as to his new worth that is calculated totally differently than everyone else's on the list!!! They all add up their equity in stocks real estate etc and compute their true NET WORTH. Trump, by your reasoning is going by GROSS worth, at best...

[shadroch]

Not sure where you guys are getting your information.

Trumps deals do not expire at his death. He has made that clear many times over.

If Forbes is letting people submit their own figures,shame on Forbes.But what exactly is the Forbes 400 list but a self serving promotion of rich people.

Anyways,you feel your way,I'll feel mine.I admire Trump and respect him because his books have worked for me,allowing me to make more money. One of my leases never would have happened had I not read The Art of the Deal.

But why the hate?

[action1kid]

When banks start creating more and more kinds of exotic mortgages to make people borrow even more than they can afford you know that the bubble is comming.Not tomorrow, but its comming.[its like margin in a stock account,it peaks at it height of a bull market]

 

When constuction and material costs are through the roof you know that a bubble is comming.Not tomorrow, but its comming.

 

When [for sale signs] pop up every where you know its happening because of a back log of houses that arnt being sold with even more comming to market,you know that a bubble is comming.

 

When things clearly slow down[and your real estae agent tells things are booming. The bubble is here.

 

When the fed raises short term interest rates quickly and the long term interest rates dont follow, a bubble is comming.

 

There all happening