Five Dumbest Things on Wall Street: Feb. 20

Trump fired; Japan finance minister's fiasco; 'Dark Knight' scandal; Big Brother Apple; a Saab story.
Publish date:

Trump Dumps Self

Try to duck it, Donald. You got fired.

Trump Entertainment Resorts


filed for Chapter 11 bankruptcy protection

Tuesday. The casino operator had assets of about $2.1 billion and total debts of about $1.74 billion on Dec. 31, 2008, it said in its filing with the U.S. Bankruptcy Court in New Jersey. Nine affiliates of the casino operator, including Trump Plaza Associates, Trump Marina Associates and Trump Taj Mahal Associates also sought protection, according to the filing.

As for Trump himself, the real estate mogul stated Friday that he had decided to resign from the board of the company. Trump also claimed he recently offered to purchase the casino company, which he once controlled before surrendering his grip as part of a previous bankruptcy restructuring.

"If I'm not going to run it, I don't want to be involved in it," a petulant Trump told

The Associated Press

last Friday. "I'm one of the largest developers in the world. I have a lot of cash and plenty of places I can go."

Trump's name will remain on the company's three Atlantic City casinos for now, although Trump said he may sue to have it removed.

"I don't like that my name is still going to be on it," said The Donald, who was the company's largest shareholder as of September with 1.3 million shares, now trading around 16 cents each.

Get over yourself, Donald, if that's possible. It's not like your name boosted the brand enough to keep it from going under anyway. And it's not like you are a stranger to bankruptcy court, having been there twice already with the casino company.

With your latest catastrophe, we wish you luck in the upcoming season of your reality show

The Celebrity Apprentice

. What you have left to teach your potential protégé, however, is beyond us.

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Dumb-o-meter score: 90 -- "Trump's next book: The Art of Denial."

Nakagawa Knock-Out

Japan's Finance Minister Shoichi Nakagawa caroused himself right out of a job this week.

Nakagawa announced he was stepping down Tuesday because of health problems after facing allegations he was publicly drunk at last weekend's Group of Seven finance ministers meeting in Rome. Nakagawa blamed his apparent "grogginess" on a combination of cold medicine and jet lag, not alcohol, despite a video of the event suggesting otherwise.

His resignation was promptly accepted by Prime Minister Taro Aso, who named Economic Minister Kaoru Yosano as the new finance chief. The Nikkei 225 stock average fell 1.4% in Tokyo on news of Nakagawa's sudden exit. The widely traded

iShares MSCI Japan Index

(EWJ) - Get Report

fell 3.3% on Tuesday after markets reopened in New York after the long weekend.

"I apologize for causing such a big fuss," said Nakagawa, according to the

Kyodo News

agency. "I visited hospital last night and this morning and was diagnosed to have a bad lower back, cold and fatigue."

And that ain't all judging from a video of Nakagawa's sorry performance making the rounds on the Internet. One does not have to understand Japanese to know that he should have been pulled over for answering heavy economic questions while under the influence.

Nakagawa at one point mistakenly responded to a reporter's question about interest rates meant for Bank of Japan Governor Masaaki Shirakawa, asking the reporter, "Hmm? What? Can you say that again?" At which point he attempted to grab a water glass in front of Shirakawa, instead of his own.

Nakagawa later admitted he had drinks on the flight to Rome as well as at a G-7 luncheon, but continued to deny allegations of "heavy drinking."

Considering the world's second-largest economy on Monday announced a staggering 14% decline in exports and an annualized GDP shrinkage of 12.7%, we understand completely the finance chief's desire to self-medicate.

Just not in public with cameras rolling. That's simply political

hari kari


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Dumb-o-meter score: 95 -- "Domo arigato to Minister Blotto from all of us here at the Five Dumbest Lab."

Knight Flight

It turns out Wall Street has its own version of

The Dark Knight


Securities and Exchange Commission

agents raided the Houston office of Sir Robert Allen Stanford on Tuesday, charging that the Knighted Texas billionaire fooled clients into pouring money into three of his companies with bogus promises of outsized returns. The SEC alleges that Stanford orchestrated a "massive" scheme revolving around $8 billion worth of certificates of deposit that promised "improbably and unsubstantiated high interest rates."


who was served with papers by the FBI in Virginia on Thursday

, offered those products through an offshore firm, Stanford International Bank, claiming that the high rates were achieved through returns from his Houston-based broker-dealer firm, Stanford Group Co.

However, the SEC says that Stanford fabricated historical return data over the past 15 years. For example, Stanford's fund reported identical returns in 1995 and 1996 of exactly 15.71%, a statistical impossibility, according to the government's complaint.

The SEC also accuses Stanford Group Co. of using fake performance data to con registered investment advisers into investing in a proprietary mutual fund wrap program called the Stanford Allocation Strategy. Those advisers forked over $1.2 billion worth of clients' money, according to the SEC.

Stanford has dual citizenship in the U.S. as well as Antigua and Barbuda, but lives on St. Croix in the U.S. Virgin Islands, according to his bio on Stanford Financial's Web site. He is the first American to have been knighted by Antigua and Barbuda, whose official head of state is Britain's Queen Elizabeth II, at the independent country's Silver Jubilee festival in November 2006, the bio says.

And oh what a knight he is! Just like fellow alleged fraudster Sir Bernard Madoff I, now under "pent"-house arrest in his castle in the sky, Stanford defrauded friends and family out of millions while living like a king on their money.

Linda Chatman Thomsen, director of the SEC's enforcement division, said the agency is "moving quickly and decisively in this enforcement action to stop this fraudulent conduct and preserve assets for investors."

You've gotta be kidding us, Linda. Stanford was operating a multibillion dollar scam for more than a decade, and now the SEC is snapping into action?

It's no wonder the Dark Knight Stanford was able to elude justice for so long. He was dealing with a bunch of Jokers.

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Dumb-o-meter score: 90 -- "Holy Moly, Batman! The SEC looks foolish again."

Apple's Big Brother Act


(AAPL) - Get Report

not only wants to control your tunes, but now your taste as well.

Apple rejected an iPhone application from the animated comedy series

South Park

this week, calling its content "potentially offensive," according to the show's

Web site

. The Emmy-award winning series, well known for its off-color humor, first submitted the App back in October, but at this point the idea is "dead in the water."

"Apple did admit that the standards would evolve, citing that when iTunes first launched it didn't sell any music with explicit lyrics," read the announcement on show's Web site before signing off "Sorry, South Park fans."

Boy, this is lame on so many levels.

First, we here at The Five Dumbest Lab expect much more from the supposedly subversive folks at

South Park

. The show's creators Trey Parker and Matt Stone regularly lampoon topics including organized religion, gay marriage, stem cells and global warming. Now their strategy is to sit back and wait for Apple's standards to "evolve?" You've parodied

The Passion of the Christ

, but you are afraid to rile Steve Jobs?

Trey and Matt: Forget killing the parka-clad Kenny character on your show. You're killing us.

And as for Apple's Big Brother act, trying to arbitrate America's tastes, that kind of behavior will only come back to haunt the company. In fact, its ridiculous prudishness is costing them big already.

According to gadget Web Site

, which originally broke the story about

South Park's

iPhone plans last fall,

South Park's

site receives more than 600,000 hits on an average day and has nearly 30,000 registered users. And when a new episode goes online, the Web site receives up to 1.5 million hits a day.

But it's not like Apple isn't thinking about this. They think about it plenty.

They just don't care.

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Dumb-o-meter score: 90 -- "iPhone's App Store's biggest seller? iFart. And that's no joke."

GM's Saab Story

Sweden's government is not buying

General Motors'

(GM) - Get Report

Saab story

and neither are we.

Sweden's industry minister on Wednesday blasted GM for saying that its Saab unit could face bankruptcy unless it receives government funding from its homeland. Maud Olofsson said she was "incredibly disappointed" in America's largest automaker and was adamant that GM, not the Swedish government, was responsible for Saab's future.

As it announced its long-awaited viability plan Tuesday, GM said it needs urgent support from the Swedish government or Saab could file for bankruptcy as early as this month. Olofsson said GM had requested 5 billion kronor ($570 million) from the government. GM has offered Saab for sale, but the Swedish government has repeatedly said it is not interested in taking over the brand.

"It's so much money and its such a huge responsibility, and so it's not actually up to (Swedish) taxpayers to do that," Olofsson told national broadcaster SVT.

Wow! For a so-called benevolent socialist nation, that is one harsh rebuke. If only their capitalists cousins across the Pond could show similar spine.

When General Motors CEO Rick Wagoner went to Washington last December with the same stark proposal -- bail us out or we go bankrupt -- the Bush administration caved to the tune of $13.4 billion in taxpayer dollars. Three months later, Wagoner is back with hat in hand, except this time he's upped the stakes to $30 billion or bust.

How will Congress react this time? Most likely the same way as before. Succumb to the Big Three's blackmail come back, time and again, with trunks open on Capitol Hill to beg for cash.

And then there's Maud, who says "Make my day' when Wagoner puts the gun to her head.

We at the Five Dumbest Lab toast you with Swedish vodka, Maud. You make Absolut Sense.

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Dumb-o-meter score: 85 -- "Go bankrupt or don't, GM. Just stop the charade."

Before joining, Gregg Greenberg was a writer and segment producer for CNBC's Closing Bell. He previously worked at FleetBoston and Lehman Brothers in their Private Client Services divisions, covering high net-worth individuals and midsize hedge funds. Greenberg attended New York University's School of Business and Economic Reporting. He also has an M.B.A. from Cornell University's Johnson School of Business, and a B.A. in history from Amherst College.