Donald Trump just filed a new financial disclosure form with the Federal Elections Commission claiming his net worth has risen to $10 billion over the last year. Forbes rebuts that, claiming his net worth has instead dropped from their previous estimate of $4.1 billion to $4 billion.
For the record, I have no idea what Trump’s net worth actually is. And I don’t care. Trump is almost certainly giving an answer higher than the real one. He wants to be called out on the lie. As Scott Adams has repeatedly pointed out, this keeps the conversation in the news. And most people aren’t even listening. For the average person, the takeaway is simple: Trump is really, really rich. The specifics don’t matter – the only argument they hear is an argument over just how really, really rich he is.
But I think Forbes did make a pretty big error in their calculations. Specifically, I think they factored Miss Universe as a loss for Trump last year.To quote their own words:
In fact, we’ve lowered our valuation of the real estate tycoon from $4.1 billion to $4 billion since his controversial remarks about Mexican immigrants during his campaign launch speech, which led to the end of his business deals with NBCUniversal, Univision, Serta Mattresses, and Macy’sM, as well as PVHPVH Corp. and Perfumania, the manufacturers of his menswear line and fragrances, respectively. In the wake of these developments, we have dropped the value of his brand to zero (previously, we pegged it at $125 million).
Like most people, I think they’ve missed what actually happened here. To be fair, you had to be paying really close attention to catch it, as the sales numbers and contractual arrangements for Trump’s Miss Universe stake weren’t public. I only caught it by sheer accident. But I’m pretty sure I’ve pieced together what happened, and it’s sheer genius on Trump’s part.
First of all, I don’t disagree that the value of Miss Universe dropped when Trump made his comments about Mexican immigrants. Those business deals were, indeed, canceled. However, what most people miss is that before then, Trump only owned half of Miss Universe. That changed later. On September 11, 2015 (an ironic date), it was quietly announced that Trump was buying out NBC’s half of Miss Universe. Most people missed that. What they didn’t miss was the second part, that came only days later. On September 14, Trump sold all of Miss Universe.
And therein lies the genius. Trump bought the beauty pageant at a deflated price – it was worth less because of his involvement. It had almost no media contracts, destroying its value. But when he sold it, he automatically became uninvolved with it. Which means that the value of the company was much higher, because all of those contracts could now be reinstated for a Trump-less pageant. Or maybe they’d negotiate better ones. The point is, it doesn’t matter. When he bought it, the company was severely undervalued compared to its potential. But that’s not the company he sold. The company he sold had full value (or near to it) again. Remember, it’s an age old adage of investment: the money isn’t made on the sale, it’s made on the purchase. Trump purchased the company at the right time.
Odds are very good that he planned this out as part of his campaign. But even if he didn’t, it shows a remarkable flexibility and the ability to take advantage of opportunity when it knocks.
Again, the actual numbers aren’t public. I can’t prove that this is how it went down. But look at the timing of it. There’s really no other way it could’ve happened. I only noticed because I happened to see the news that he’d bought NBC’s stake on the day it happened. I was laughing at the time, certain that he’d gotten a fire sale price for it. Then a few days later I saw that he’d sold it, and I was laughing even harder.
Trump Trumped NBC, plain and simple.
Bonus thought: the value of Trump’s brand may be lowered or may be raised by the events of his presidential bid. But Forbes has gone full retard by labeling it as “zero.” The eleven million votes he’s received in the Republican primary definitively proves that it’s not zero.
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