The Trump Files: Donald Flipped Out When an Analyst (Correctly) Predicted His Casino’s Failure

The Trump Taj Mahal did even worse than anticipated.

Albert H. Teich/Shutterstock

For indispensable reporting on the coronavirus crisis, the election, and more, subscribe to the Mother Jones Daily newsletter.

Just as Donald Trump was preparing in 1990 to open the Trump Taj Mahal, a gargantuan Atlantic City casino that was supposed to become the crown jewel of his gambling empire, one man poured cold water all over the project.

That man was Marvin Roffman, a respected casino analyst at brokerage firm Janney Montgomery Scott. Two weeks before the casino was set to open in April 1990, Roffman told the Wall Street Journal that it would never succeed. Trump had financed the Taj’s construction with $675 million in high-interest junk bonds, and Roffman said the casino would have to do record-breaking business to keep up with the debt. Specifically, it would have to earn at least $1.3 million a day, something no casino had ever pulled off.

“When this property opens, he will have had so much free publicity he will break every record in the books in April, June, and July,” he told the Journal. “But once the cold winds blow from October to February, it won’t make it. The market just isn’t there.”

Trump, to say the least, was not happy. According to Washington Post reporters Michael Kranish and Marc Fisher, Roffman went to meet Robert Trump, Donald’s brother and a Taj executive, not knowing the Journal had published his comments just hours before. “Roffman found Robert Trump and extended his hand for a shake,” Kranish and Fisher wrote in their book, Trump Revealed. “Robert exploded. He said Roffman had stabbed the bondholders in the back. ‘Get the fuck off the property,’ Robert screamed. ‘Good-bye.'”

“I mean, every word out of his mouth was a four-letter word,” Roffman recalled.

Donald went much further in his rage. He called both Roffman and his boss and sent Janney Montgomery Scott a letter saying he would “institute a major lawsuit” unless Roffman retracted his comments. Roffman at first signed an apology, but he recanted the next day. Roffman was promptly fired, although the firm claimed to the New York Times it had nothing to do with Trump.

Roffman was out of a job, but he was immediately proven right about the Taj—and it didn’t even take until the fall. Within its first three months, the Associated Press reported, the Taj lost $14 million. Trump defaulted on the casino’s debt in November 1990, just six months after it opened, and gave up 50 percent of its ownership to his creditors during bankruptcy proceedings the next year. And Roffman had one final laugh: He won a $750,000 wrongful-dismissal lawsuit in 1991.

Read the rest of “The Trump Files”:

 

DOES IT FEEL LIKE POLITICS IS AT A BREAKING POINT?

Headshot of Editor in Chief of Mother Jones, Clara Jeffery

It sure feels that way to me, and here at Mother Jones, we’ve been thinking a lot about what journalism needs to do differently, and how we can have the biggest impact.

We kept coming back to one word: corruption. Democracy and the rule of law being undermined by those with wealth and power for their own gain. So we're launching an ambitious Mother Jones Corruption Project to do deep, time-intensive reporting on systemic corruption, and asking the MoJo community to help crowdfund it.

We aim to hire, build a team, and give them the time and space needed to understand how we got here and how we might get out. We want to dig into the forces and decisions that have allowed massive conflicts of interest, influence peddling, and win-at-all-costs politics to flourish.

It's unlike anything we've done, and we have seed funding to get started, but we're looking to raise $500,000 from readers by July when we'll be making key budgeting decisions—and the more resources we have by then, the deeper we can dig. If our plan sounds good to you, please help kickstart it with a tax-deductible donation today.

Thanks for reading—whether or not you can pitch in today, or ever, I'm glad you're with us.

Signed by Clara Jeffery

Clara Jeffery, Editor-in-Chief

We Recommend

Latest