Donald Trump’s entire schtick is that he’s very rich, ergo, he must be very smart. However, if calculations are correct, if he had simply invested his inheritance the way you or I might, instead of buying lavish resorts, casinos and apartment buildings, he’d be a lot richer.
According to Money Talks News, if Trump had pivoted away from real estate thirty years ago, and put it in an unmanaged stock index fund, he’d have $10 billion more than the $4.5 billion he has now (Trump says he’s worth $10 billion, but that doesn’t matter).
In 1982, Trump’s net worth was somewhere between $200 million and $500 million. For the calculations, Money Talks is going with the higher number.
Imagine Trump had retired in 1982, sold his real estate holdings and invested his $500 million in the S&P 500 — that is, 500 stocks representing the American stock market.
From 1982 through the end of 2014, the S&P 500 index had an annualized return, including reinvested dividends, of 11.86 percent, according to MoneyChimp’s S&P 500 Compound Annual Growth Rate calculator.
Per this calculator, every dollar invested in January 1982 would have been worth $40 by December of 2014. That means Trump’s initial $500 million would have grown to $20 billion. That’s twice what Trump says he’s worth today.
What this indicates is that nothing, absolutely nothing, about Donald Trump is true. Sure, he’s worth a lot of money, but he throws around his money like it’s a toy. He relies on taxpayer funding and, when his decisions go bad, as they did four times, the taxpayers have had to bail him out.
Now, of course, this doesn’t say that any of us could be as wealthy as Trump. Remember, his father gave him an inheritance worth somewhere between $40 million and $200 million and he had a ton of help from the federal and local governments, as did his father.
Trump was born in New York City in 1946, the son of real estate tycoon Fred Trump. Fred Trump’s business success not only provided Donald Trump with a posh youth of private schools and economic security but eventually blessed him with an inheritance worth an estimated $40 million to $200 million. It is critical to note, however, that his father’s success, which granted Donald Trump such a great advantage, was enabled and buffered by governmental financing programs. In 1934, while struggling during the Great Depression, financing from the Federal Housing Administration (FHA) allowed Fred Trump to revive his business and begin building a multitude of homes in Brooklyn, selling at $6,000 apiece. Furthermore, throughout World War II, Fred Trump constructed FHA-backed housing for US naval personnel near major shipyards along the East Coast.
Donald Trump is good at one thing and only at one thing: marketing himself. Claims of his vast wealth and his great intelligence are nothing but more marketing.
Featured image via Flickr.