Conservatives have railed for decades about the evils of debt. Now The Wall Street Journal reports that they have elected the Debtor-in-Chief. Lauren McCauley writes:
An analysis by the Wall Street Journal published Thursday found that the incoming president owes at least $1.85 billion in debt to as many as 150 Wall Street firms and other financial institutions.
According to the examination of legal and property documents, “Hundreds of millions of dollars of debt attached to Mr. Trump’s properties, some of them backed by Mr. Trump’s personal guarantee, were packaged into securities and sold to investors over the past five years,” thus “broadening the tangle of interests that pose potential conflicts for the incoming president’s administration.”
In May, Trump filed documents with the Federal Election Commission (FEC) that disclosed $315 million owed to 10 companies—but that only included debts for companies that Trump completely controls, “excluding more than $1.5 billion lent to partnerships that are 30 percent owned by him,” WSJ reported.
“As a result,” wrote WSJ reporters Jean Eaglesham and Lisa Schwartz, “a broader array of financial institutions now are in a potentially powerful position over the incoming president.”
Things get really funky when you stop and consider that, as President, Trump gets to appoint the regulators of the companies to which he owes money:
In one troubling example, the investigation found that Wells Fargo, currently under investigation for a years-long banking fraud scandal, “runs at least five mutual funds that own portions of Trump businesses’ securitized debt;” is “a trustee or administrator for pools of securitized loans that include $282 million of loans to Mr. Trump;” and “acts as a special servicer for $950 million of loans to a property that one of Mr. Trump’s companies partly owns.”
“Once he takes office,” Eaglesham and Schwartz observed, “Mr. Trump will appoint the heads of many of the regulators that police the bank.”
Furthermore, Trump's debt has been financed by the same instruments that caused the financial meltdown of 2008:
The spread of Trump’s debt can in large part be attributed to the process known as “securitization,” when debt is repackaged into bonds and sold off. More than $1 billion of debt connected to the president-elect has been handled in this way.
The smell of rot gets more and more pungent.
8 comments:
This is deeply troubling.
Trump's exposure to Wall Street pressure could influence public policy.
Wall Street could name his cabinet members. They could get him to deregulate their industry. Get regulators to look the other way as they engage in criminal fraud. Force him to use taxpayer dollars to bail them out when their excesses explode in their faces. And use their influence to protect them from the threat of prosecution for their crimes.
...
Oh wait ...
.. a scenario develops .. of a complete phony, overleveraged business fool, running on the fumes of vanity, narcissism and free mainstream media publicity. Abducted a rotting Republican political structure & set sail for the White House.. Who actually controls Donald Trump's debt? China? Russia? Its become obvious this loser is a walking talking spewing PonziMan
Exactly, thwap. We've seen it all before. The difference is that it's now on steroids.
That's an excellent and accurate phrase, salamander -- "running on the fumes of vanity."
A vassal indentured to his powerful creditors. Should we call Trump an "empty vassal"?
Empty vassals make the most noise, Mound.
nothing matters except the scenario, thats the new world grow up Owen. Before you dismiss it out of hand remember Jack Layton and admit we should not shoot the messanger even if it was Putin. The DNC was totally corrupt. So I will take a out of control asshole everyday over a totally corrupt mechanizzed
system.
Going from the frying pan into the fire isn't progress, Steve.
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