Debunking the Myth: Trump’s Losses and Business Practices

Supporters of former President Trump often view his numerous business losses and bankruptcies as 'fake news', dismissing them with a dismissive attitude. However, these are well-known facts in the business world, particularly for real estate developers. This article delves into the reality behind these losses and clarifies some common misconceptions.

The “Fake News” Narrative

Notably, Trump supporters have taken to labeling his significant losses and the six Chapter 11 bankruptcies as mere 'fake news'. This controversial claim is underpinned by the so-called 'believe what I say, not what I do' mentality. This approach is particularly disingenuous considering that research reveals only a fraction of the population, approximately 35-40%, is susceptible to such beliefs. This mindset explains why a minority still clings to these beliefs, despite evidence to the contrary.

The Business Reality: Old News and Common Practice

These financial setbacks were notably revealed during the airing of 'The Apprentice', a television show where Trump showcased his business prowess. However, this revelation is far from a new event. It has the flavor of old news, akin to the famous revelation of Newton’s law of gravity. Essentially, for someone with even a basic understanding, it's clear that real estate development, just like any other industry, can face occasional setbacks.

It is a well-established fact that real estate developers, like any other business sector, experience fluctuations. This industry is known for its boom and bust cycles. Therefore, it is not surprising to hear of deals going bad from time to time. In fact, this is a common occurrence in the industry. Historical examples of notables such as Harry Truman, Abe Lincoln, and Ulysses Grant demonstrate that people who venture into business often face financial difficulties.

A Closer Look at the Financial Practices

The issue of debt and bankruptcy aside, the more significant point here is the nature of Trump’s financial reporting. Specifically, his financial accounts did not actually record a loss from a revenue perspective. Instead, he recorded negative taxable income. This is a common practice in the financial world and has been one of the most talked-about issues in recent business dealings.

In the modern day, many Silicon Valley startups achieve billionaire status post-IPOs without ever generating a profit. This is because the primary value of a company comes from the appreciation of its assets rather than the profit it generates. The gains from the increase in stock value often far outweigh the dividends received from stock ownership. Thus, it is quite normal for a business to have negative income and still increase in value.

Moreover, Trump's practice of claiming depreciation on assets is another standard business move. Depreciation allows businesses to deduct the value of their assets over time, which can result in negative taxable income. This is a common and legally permissible business practice. Critics who label these practices as scandalous are, in essence, displaying their own lack of knowledge about business practices.

A Conclusion

There is no denying that Trump’s losses and bankruptcies have been a subject of much media attention and debate. However, these losses, when contextualized within the broader framework of real estate and business practice, are less scandalous and more a testament to the industry's volatility and the complexity of financial reporting. Understanding these practices can help in appreciating the nuances of the business world and the reality behind the headlines.