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Atlantic City, and it is there, of late, that the Trump alchemy—transforming other people’s money into his own wealth—has been most strenuously tested.
    To bail himself out with the banks, Trump converted his casinos to public ownership, despite the fact that the constraints inherent in answering to shareholders do not come to him naturally. Inside the Trump Organization, for instance, there is talk of “the Donald factor,” the three to five dollars per share that Wall Street presumably discounts Trump Hotels & Casino Resorts by allowing for his braggadocio and unpredictability. The initial public offering, in June 1995, raised a hundred and forty million dollars, at fourteen dollars a share. Less than a year later, a secondary offering, at thirty-one dollars per share, brought in an additional three hundred and eighty million dollars. Trump’s personal stake in the company now stands at close to forty percent. As chairman, Donald had an excellent year in 1996, drawing a million-dollar salary, another million for miscellaneous “services,” and a bonus of five million. As a shareholder, however, he did considerably less well. A year ago, the stock traded at thirty-five dollars; it now sells for around ten.
    Notwithstanding Trump’s insistence that things have never been better, Trump Hotels & Casino Resorts has to cope with several thorny liabilities, starting with a junk-bond debt load of a billion seven hundred million dollars. In 1996, the company’s losses amounted to three dollars and twenty-seven cents per share—attributable, in part, to extraordinary expenses but also to the fact that the Atlantic City gaming industry has all but stopped growing. And, most glaringly, there was the burden of the Trump Castle, which experienced a ten percent revenue decline, the worst of any casino in Atlantic City.
    Last October, the Castle, a heavily leveraged consistent money loser that had been wholly owned by Trump, was bought into Trump Hotels, a transaction that gave him five million eight hundred and thirty-seven thousand shares of stock. Within two weeks—helped along by a reduced earnings estimate from a leading analyst—the stock price, which had been eroding since the spring, began to slide more precipitously, triggering a shareholder lawsuit that accused Trump of self-dealing and a “gross breach of his fiduciary duties.” At which point he began looking for a partner. The deal Trump came up with called for Colony Capital, a sharp real-estate outfit from Los Angeles, to buy fifty-one percent of the Castle for a price that seemed to vindicate the terms under which he’d unloaded it on the public company. Closer inspection revealed, however, that Colony’s capital injection would give it high-yield preferred, rather than common, stock—in other words, less an investment than a loan. Trump-l’oeil: Instead of trying to persuade the world that he owned something that wasn’t his, he was trying to convey the impression that he would part with an onerous asset that, as a practical matter, he would still be stuck with. In any event, in March the entire deal fell apart. Trump, in character, claimed that he, not Colony, had called it off.
    The short-term attempt to solve the Castle’s problems is a four-million-dollar cosmetic overhaul. This so-called re-theming will culminate in June, when the casino acquires a new name: Trump Marina. One day this winter, I accompanied Trump when he buzzed into Atlantic City for a re-theming meeting with Nicholas Ribis, the president and chief executive officer of Trump Hotels, and several Castle executives. The discussion ranged from the size of the lettering on the outside of the building to the sparkling gray granite in the lobby to potential future renderings, including a version with an as yet unbuilt hotel tower and a permanently docked yacht to be called
Miss Universe.
Why the boat? “It’s just an attraction,” Trump said. “You understand, this would be part of