You'd Think Trump Would Be An Expert On Bankruptcy After Filing For It Three Times
Facts
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But Mah Narrative
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Your problem is you don't understand basic economics or business. A strategic bankruptcy may occur when an otherwise solvent company makes use of the bankruptcy laws for some specific business purpose.[1] A strategic bankruptcy can be used to get away from expensive contracts otherwise unbreakable. For example the airlines Sabena and Swissair have gone bankrupt and been restructured and got away from high salary and expensive pension contracts with pilots and other staff. In 2002 Kmart filed Chapter 11 for protection from creditors. One of the main problems affecting Kmart's cash flow and therefore its liquidity was that Kmart was locked into long-term leases at premium rates with respect to various unprofitable stores. While in chapter 11 reorganization, Kmart was able to renegotiate or rescind those particular leases. In some countries, like Sweden, it is common at least for smaller companies with deep debts, to have a bankruptcy, and close down the company, but where the owner has prepared a new company which buys important assets including the name, and continues with much smaller debts. Side: Facts
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First things first: Donald Trump has filed for corporate bankruptcy four times, in 1991, 1992, 2004 and 2009. All of these bankruptcies were connected to over-leveraged casino and hotel properties in Atlantic City, all of which are now operated under the banner of Trump Entertainment Resorts. He has never filed for personal bankruptcy — an important distinction when considering his ability to emerge relatively unscathed, at least financially. “Corporations, limited partnerships, and LLCs in which he had an ownership interest or companies that had his name attached have filed for bankruptcy,” said Michael Viscount of Atlantic City law firm Fox Rothschild LLP, who represented unsecured creditors when Trump Hotels & Casino Resorts, as it was then called, filed for Chapter 11 protection in 2004. “Therein lies the big distinction.” Side: But Mah Narrative
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