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Hi guys, so here we're back at Trump Tower Tuesday in 1987.

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So again another very busy day for Trump and a lot of lesson learned in yet another day.

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So it kicks off with him getting a call from someone who's interested in selling the Beverly

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Hills Hotel in LA.

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And although Trump attended that hotel multiple times when he was a bit younger, 10 to 15

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years prior, he's not fully convinced by this opportunity and he says he doesn't let his

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personal preference affect his business judgement.

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So it's not because he's been exposed to that hotel in the past and he enjoyed his time

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there that he's going to consider this opportunity different than another, with any set of different

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criteria than he would otherwise.

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So this personal preference is not affecting his business judgement.

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Secondly there's a theme that repeats again throughout this day, it's to never waste yours

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or someone else's time.

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To go straight to the point, and there's many instances where he shows how much he values

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that, the ability to go straight to the point.

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For example he's going to mention one of his interactions with a top real estate attorney.

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He's going to say Jerry's more than an attorney, he's an absolute business machine and he can

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see through to the essence of a deal as fast as anyone I know.

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And he says we cover a half dozen subjects in less than 10 minutes.

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Similarly when he has calls with his investment bankers, he can come to a conclusion in two

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minutes.

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Again a theme that's recurring is a lot to go with gut instinct.

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And if you hear, of course this is focused on Donald Trump, but from other top CEOs,

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gut instinct is often referred to as a superior intelligence versus purely an analytical analysis

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if you will, forgive the repetition.

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Essentially Trump prefers to go with his gut and he's going to, here's another interesting

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quote on trusting his gut.

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He says I hear Lee and his guys on their deal, but in truth it doesn't excite me much.

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We leave it at that and I'll get back to them.

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So he shows that he trusts his gut so much that he'll listen to someone else and he'll

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see how he feels about it.

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And if it didn't convince him, it didn't convince him.

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He adds another quote, Larry's both a bright and a nice guy and he's very enthusiastic,

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but he doesn't convince me.

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Here again we see how much importance he gives to letting almost his body speak to him in

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terms of should he go forward or not with his gut instinct.

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So he hears it out, but he's going to go with the gut feeling.

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So he encourages, you're going to see an interesting change in tax that happens at the time that

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is going to benefit him, but he sees the second order consequence and the incentives behind

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it.

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So he says I still believe this law will be a disaster for the country since it eliminates

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incentives to invest and build, particularly in secondary locations where no building will

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occur unless there are incentives.

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So he comes to the, with foresight, another one of his attributes, he sees that although

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he's getting relief by certain tax that came into passing, this is not going to be good

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for the industry as a whole and for ultimately for the country because the incentives are

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becoming lessened.

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And if you want to quote the great Charlie Munger, he's going to say that show me the

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incentive, I'll show you the outcome.

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And he refers to incentives as the driving force behind human motivation and human action

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and accomplishment.

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So understanding second order consequences and incentives is also a big thing.

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And he then follows up by thanking the senator who stood against this new tax bill.

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So he says I don't know that for personally, but he's one of the few senators who fought

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hard against this new tax bill.

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It's probably too late, but I just want to congratulate him on having the courage of

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his convictions, even though it might cost him politically.

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Of course, this is a recurring theme in Trump's life and his political life.

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So here the lesson is to cultivate the courage to speak up your convictions even when it

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may be unpopular.

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This is another lesson we can walk away with.

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Earlier we mentioned his tendency to protect or to not waste time for others.

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He's also mindful of time for his.

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To protect his time, he says frankly I'm not too big on parties because I can't stand small

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talk.

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Unfortunately, they're part of doing business, so I find myself going to more than I'd like.

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And then trying hard to leave early.

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Talking to his investment bankers, he says that he likes to keep as many options open

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as I can.

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So he's deliberating whether he should acquire the holiday inn hotel or wait until he gets

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a casino license before doing that in Nevada.

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He gets a call from a landowner, an undeveloped land in Las Vegas, and he's thinking that

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they also own perhaps the best undeveloped site on the Vegas trip.

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For the right price, I'd consider buying it.

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I like the casino business.

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I like the scale, which is huge.

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I like the glamour, and most of all I like the cash flow.

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If you know what you're doing and you run your operation reasonably well, you can make

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a very nice profit.

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If you run it very well, you can make a ton of money.

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This will likely be the genesis of the Trump Las Vegas later on.

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So here the idea is to think right price and to think cash flow.

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So again, to not be emotional in the decision making process and for the right price, meaning

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not at any price, regardless of how attractive a piece of land, a piece of property, a stock

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may look like, right price is a real metric.

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Cash flow, of course, in real estate, is another one that's important.

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He was supposed to meet one of the mayor's officials for city planning, and he didn't

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get through to him on the phone, so he left a message.

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The message was very brief.

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Instead of laying out his pleas or what he would have wanted to ask on a voice note,

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that's not the smartest thing to do.

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It's long.

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It's impersonal.

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He lacks a report.

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He just left a message with his secretary saying, I'm looking forward to seeing him

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on Friday morning.

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So keeping things brief is recurring again.

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You mentioned the cultivated ability to see through the essence of a deal as fast as possible,

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to be quick thinking.

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In the afternoon, Trump gets a visit from his wife and he explains how and where he

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met her.

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He came from the Czech Republic and was a skier in Czechoslovakia before coming to Montreal

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in Canada where she was a model.

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She was attending events at the Montreal Summer Olympic Games in 1976.

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So Donald Trump met his wife Ivana in Montreal and he says, I dated a lot of different women

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by then, but I'd never gotten seriously involved with any of them.

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Ivana wasn't someone you dated casually.

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Ten months later, in April 1977, we were married.

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So of course he met someone he thought was of high potential to spend a life with and

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they had three children that we now know who've been raised in some ways exemplarily.

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So Trump made the bet to marry the woman he met ten months later.

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That's a comment on his first wife Ivana.

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He gets calls from Cadillac, the iconic branch from General Motors.

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They want to brand a limousine to his name or a set of limousines to his last name that

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was already well known.

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And we'll see that his knowledge of the automobile industry is going to be useful a bit later

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on in subsequent books.

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So we're going to find out that he predicted their demise or to be more accurate, their

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bankruptcy.

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So these books were written in the late 80s and he's going to write books in the early

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90s.

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And we'll see that in 2009, the three big auto manufacturers indeed needed government

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bailouts to avoid bankruptcy.

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So they were indeed in that situation that he's going to pass.

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So you'll see a lot of foresight in forthcoming editions.

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A comment on loyalty.

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So he's approached by Drexel Burnham Lambert, then a well established investment bank of

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Michael Milken fame and or in famous depending on how you see it for that set of events.

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They want to be their Trump's investment maker, but Trump said that he's going to remain with

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Alan Greenberg from Bear Stearns.

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This is comment on loyalty.

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He says, in any case, I happen to think Mike's referring to Michael Milken's a brilliant

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guy.

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However, Alan Greenberg is exceptional himself and I'm loyal to people who've done good work

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for me.

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So we should see that loyalty is an important value to Trump.

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He wants people who are competent and who have good intentions.

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So of course, these two don't always go together, but he wants both competence and good intentions

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for them.

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So that's something that he values highly.

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He's meaning good work for him and it goes both ways.

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He's good to the people who are good to him, both in the sense of competence and of good

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intentions.

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On trusting your gut instinct.

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So see, he's going to listen.

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So he's very open minded.

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He's exposed to different deals and he listens to proposals, but you'll see his reaction.

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We trust his gut instincts.

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So he's going to say, I hear Lee and his guys out on their deal, but in truth, it doesn't

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excite me much.

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We'll leave it at that and I'll get it back to them.

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This is the first example where he's looking internally to see does the deal excite him,

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yes or no.

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And secondly, Larry's both a bright and a nice guy.

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He's very enthusiastic, but he doesn't convince me.

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I mentioned that earlier in this episode, but it's worth mentioning again.

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So he lets himself get convinced.

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He's exposing himself to arguments and he's observing how internally is he being convinced

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or not.

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His trust in his instinct, in his natural instinct, which we all have, is, I don't want

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to say full proof, but almost.

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He really believes that his body is going to tell him the right conclusion from being

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exposed to these arguments.

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So he's not convinced and he's not excited.

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We see that it's really at the gut level and this is another lesson we can take.

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So listen to your gut.

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And he's going to comment on the success of Calvin Klein.

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He says he's a very talented designer, but he's also a very good salesman and businessman.

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And it's a combination of those qualities that makes him so successful.

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So you could be a product designer.

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You're going to need to know sales skills and business skills to make things a commercial

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success.

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These are two attributes that we could probably apply to any profession.

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So don't underestimate the power of having good sales skills.

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And finally, responding to a fake news article by the New York Times, he says, the way I

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see it, critics get to say what they want about my work, so why shouldn't I be able

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to say what I want about theirs?

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So for him, it's fair game.

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If he's getting criticized, he can criticize back, given that there's fallible humans beyond

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every organization and they can also make mistakes.

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To summarize, don't let personal preferences affect your business judgment.

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Don't waste yours or someone else's time.

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Go straight to the point.

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Keep things brief.

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Think of second order consequences and incentives.

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Cultivate the courage to speak up your convictions even when it may be unpopular.

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Think right price and cash flow.

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Cultivate the ability to see through the essence of a deal as fast as possible.

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Be loyal to those who are loyal to you.

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And listen to your gut.

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I hope you enjoyed this episode and see you on the next one.

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Thanks.

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NEXT comme.