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Off-Balance Sheet: The CEO's Pants Are On Fire!

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Do they see what we see? Obviously not...

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Relax, it's only money. Here in the 'Ville we like to keep things smart, but we also love to laugh. All work and no play...you know how it goes. With that in mind we give you The "Off-Balance Sheet," a place where Minyans can experience humorous takes on the world of finance, personal stories from our Professors and Minyans and all the other stuff that makes life worth living. So take a break from the flickering ticks and dive in.


Donald Trump never seems particularly concerned about anything-with the possible exception of comments made about him by Rosie O'Donnell. When it comes to his companies, everything is always going just swimmingly in Trump World.

But, as reported in The New York Times today, the facts are the facts.

Two of the three Trump casinos in Atlantic City come in dead last in terms of gambling revenues among the eleven casinos in town. That his casino holding company lost $19 million last year is peanuts compared to the $1.4 billion in debt it's carrying.

"These properties are not earning what they could or should be earning," said Morgan Joseph gambling analyst Adam Steinberg.

The article says that "more than one casino executive questioned privately whether the three properties owned by Trump Entertainment Resorts (TRMP), which have suffered years of neglect due to drawn-out financial woes, have the cash necessary to compete in the new Atlantic City.

"You almost have to feel sorry for them," one said. "They're trying, but you have to wonder if they can pull it off."



However, when asked by Times reporter Gary Rivlin about the flaccid performance of his casinos, he said:

"I'm happy to say we're doing very, very well. I couldn't be happier with how things are going."


Dyed-in-the-wool sophisticate Donald Trump shaving Vince McMahon's head

An interesting take on the situation. Which got me to thinking-do other executives running floundering companies take the same "head-in-the-sand" approach as The Donald?

As a matter of fact, they do:


-New Century CFO Eric Sieracki

In the largest bankruptcy case to date in the subprime arena, New Century Financial Corporation listed liabilities of more than $100 million in its Chapter 11 papers filed with the federal bankruptcy court. The company is also the subject of a federal criminal inquiry, regarding securities fraud and accounting errors. New Century's stock, which traded at $31.59 a share at the end of last year, was delisted by the New York Stock Exchange in mid-March, and its shares closed down $1.55 on Friday to $1.66 in the over-the-counter market.


Chart courtesy of MSN Money

At an investment conference in San Francisco, Sieracki said:

"This is the pain phase of a healthy cycle. We've been through these kinds of cycles before and we've seen another day. We're a top-conditioned athlete."

CEO & Chairman Brad Morrice took it a step further, saying, "[our associates] can be proud of what they have accomplished over the years."

Take a bow, folks. You done good.


-Vonage CEO Mike Snyder

Verizon (VZ) sued Vonage (VG) in June, claiming it lured away more than a million Verizon customers by copying voicemail and other services, as well as a method for interpreting Voice over Internet Protocol calls so they can be heard over traditional phone lines. Shares of Vonage fell $1.05, or 26 percent, to $3 in New York Stock Exchange composite trading, the lowest closing price since they were sold to the public in May. About 9.78 million changed hands, almost nine times the three-month daily average. The decline cut the company's market value to $464.8 million, and they may be forced to shut down, according to industry-watchers.


Chart courtesy of MSN Money

Applying Trump's unique brand of "logic", Snyder said:

"Vonage's customers will see no change whatsoever to any aspect of their phone service."

Sure, they won't. Except for the fact that there will likely soon be no such thing as Vonage.


-Ford President & CEO Alan Mulally

Ford Motor Co. (F) lost a staggering $12.7 billion in 2006 - an average of $1,925 for every car and truck it sold and the worst loss in the company's 103-year-history. A fourth-quarter loss of $5.8 billion added to Ford's woes, which for the year amounted to $6.79 per share versus a profit of $1.44 billion, or 77 cents a share, in 2005.


Chart courtesy of MSN Money

Looking at Ford's crash-and-burn through Trump's eyes, Mulally said:

"It'll be fine. We've got a great product."

In regards to the makeup of the management team that led the country's first automaker to the precipice, Mulally said:

"No glaring holes."

No, just glaring stockholders pissed off beyond belief about the glaring ineptitude of the glaringly incompetent management team.

As for me? Well, I've got to pony up an ungodly sum to meet a margin call today, the landlord raised my rent 12%, and I just got soaked in a phenomenally ill-advised gamble on lean hogs.

But, I have to say:


"Everything's magnificent!"

No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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