Sandwiched between the New York Stock Exchange and the Federal Reserve, Donald Trump's 70-storey skyscraper here has put the real estate developer literally in the centre of the financial world.
Shuffling out of the Trump Building recently, Robert Austin, who has spent nearly 30 years helping put together multibillion-dollar bond deals, throws a passing glance at the billionaire's name sketched in gold block letters on the front of the building, then shrugs. "Just because he's here doesn't make him one of us," he says.Trump's relationship with Wall Street is complicated by decades of name-calling, lawsuits and big debts. Photo: AP
Trump's relationship with Wall Street is complicated by decades of name-calling, lawsuits and big debts. He has sued Deutsche Bank, blaming the megabank for the financial crisis, but continues to rely on it to finance major projects. When his companies filed for bankruptcy, he bragged, it was the big banks that endured big losses - not him. He once called the dean of New York bankers, JPMorgan Chase chief executive Jamie Dimon, "the worst banker in the United States".
"New York is amazing and welcoming of interesting characters. It's a place people can be unique, they can be abrasive, and on a personal level, the city is very open to people being their authentic selves," said Kathryn Wylde, president and chief executive of the Partnership for New York City, which counts the chief executives of Morgan Stanley and Citigroup among its board members. But "most business leaders want to tread carefully and not engage in unnecessary controversy."Trump once called the dean of New York bankers, JPMorgan Chase chief executive Jamie Dimon, "the worst banker in the United States". Photo: Bloomberg
Trump "tends to evoke the unexpected," Wylde said.
Unpredictable and combative
Over more than a dozen interviews with Wall Street bankers and executives, Trump was described as unpredictable and combative. Several insiders, who spoke on the condition of anonymity for fear of angering Trump, questioned whether his decades in the real estate business give him the skills to lead the country during a period of market volatility, when some of the world's largest economies are slowing. Bankers crave predictability, whether from a Republican or a Democratic administration, industry officials say. And it is not clear that Trump could - or wants to - deliver that, they say.
Wall Street may have reason to be wary of Trump. He has repeatedly said that hedge-fund managers, the masters of the universe of today's New York financial world, are getting away with "murder" under the current corporate tax code, and he has attacked companies that move their headquarters overseas to lower their tax bill.
Trump's spokeswoman, Hope Hicks, declined to comment for this article, but the campaign has noted that Trump has the support of some prominent names in the financial industry, including Carl Icahn, whom Trump has said he would nominate for treasury secretary.Trump has said he would nominate Carl Icahn for treasury secretary. Photo: Bloomberg
"I just think you need to shake up the establishment. We need to do something to change things. I think Donald could do that," Icahn said in an interview. Currently, "we can't get anything accomplished in Washington. We need a major change."
Andy Beal, founder of Beal Bank, whom Trump has referred to as "the most successful and wealthiest investor in the country", has also thrown his support behind the GOP front-runner. "I don't agree with everything that anyone says, but I admire people who are willing to say what they are thinking, without regard to the popularity of the statement," Beal said in a statement. "Donald Trump is a man who understands the importance of creating opportunity for everyone and who freely speaks his mind."
By the time Trump bought the building at 40 Wall Street in 1995, the skyscraper had fallen into disrepair. It had briefly been the tallest building in the world in 1930, but after having passed through several hands (including those belonging to the former president of the Philippines), Trump planned a major renovation.
"The Trump Building at 40 Wall Street signalled a change in the real estate market in Lower Manhattan, which has been in serious peril," Trump said in a 1998 statement announcing the unveiling of the building. "What we have accomplished with this renovation is to prove once again, New York City's downtown area was, is and will always be the epicentre of the global business community."
But Trump's relationship with Wall Street appears to end at real estate. And that has some insiders nervous.
"I can't find connective tissue between the financial sector and Trump," said one senior industry official, who spoke on the condition of anonymity to avoid being seen publicly questioning Trump.
Throughout the financial world, worried executives are grasping for clues into Trump's thinking. This much is clear: hedge-fund executives could have to fight to retain one of the industry's biggest perks - the lower tax rate they pay on their profits.
"They're paying nothing. And it's ridiculous," Trump said on CBS's Face the Nation last year. "I want to save the middle class ... The hedge-fund guys didn't build this country. These are guys that shift paper around, and they get lucky."
More concerning, some executives say, is how and if Trump would weigh in on issues such as whether 2010's congressional financial reform package, Dodd-Frank, went far enough to secure the financial system or if regulators should be spending more time prosecuting white-collar crime.
"Wall Street works in close collaboration between policymakers and markets, and Trump is a disrupter," said Peter Kenny, a 20-year Wall Street veteran. "Just because he's a billionaire does not mean that he is part of the team."
In the meantime, much of the industry has gotten behind other candidates, rather than embracing Trump as one of their own, only to see their favoured horses fail to stay in the race. Billionaire investor Paul Singer served as the national finance chairman for now-departed Marco Rubio and has contributed to a new anti-Trump group, the Our Principles PAC. Wayne Berman, a senior adviser for global government affairs at the Blackstone Group, one of the country's largest private equity firms, also threw his support behind the candidate who has withdrawn.
Some are crestfallen that former New York Mayor Michael Bloomberg has decided not to join the race.
"He was a fabulous mayor of New York, he is one of us, he lives in our neighbourhood, he just appeals to everyone," said Whitney Tilson, a hedge-fund manager who runs Kase Capital and says he will vote for a Democrat. "If Trump is the nominee, I will move heaven and earth, I will write cheques until it hurts."
Lingering public anger at the bank industry following the financial crisis may be blunting the industry's response to Trump's rise. Last September, Goldman Sachs chief executive Lloyd Blankfein said the idea of Trump having his "finger on the button blows my mind." But when pressed to endorse a candidate last month, Blankfein demurred. "I don't want to help or hurt anybody by giving them my endorsement," Blankfein, who has previously supported Hillary Clinton, told CNBC.
Also staying on the sidelines is Dimon, the chief executive of JPMorgan Chase, the largest bank in the country. Trump took aim at Dimon in 2013 as the bank was settling several large cases, including reaching a $US13 billion ($17.3 billion) deal with the Justice Department over toxic mortgage bonds sold in the run-up to the financial crisis.
"I don't believe in settling cases. I'm not Jamie Dimon, who pays $US13 billion to settle a case and then pays $US11 billion to settle a case and who I think is the worst banker in the United States," Trump said at the time.
Dimon, who is a Democrat, has declined to say who he will vote for in November and did not respond to Trump's attack. Still, when asked last year about whether a CEO would make a good president, Dimon said on Meet the Press: "I think some of the attributes could be good. Running things, knowing how to run things, knowing how to get good people involved."
But he added: "It's not sufficient. I think you have a whole nother set of attributes. I think it's really complex - politics. It's three-dimensional chess."
One bank that Trump has not shied away from tangling with is Deutsche Bank, the giant German conglomerate.
In 2008, Trump was several years into a project to build a 92-storey glass tower in Chicago, slated to be the second-tallest building in the United States. But the hotel and condominium project had run into the chainsaw of the economic slowdown, and leasing was slow.
Trump had personally guaranteed $US40 million of Deutsche's $US640 million construction loan for the project. When a payment came due in November 2008, the billionaire asked for an extension. Deutsche refused, and Trump sued for $US3 billion, condemning the bank's "predatory lending practices".
Deutsche countersued and did not hold back in asking that Trump's suit be thrown out. "Trump is no stranger to an overdue debt," the company said in one filing. "This suit is classic Trump."
Trump and Deutsche Bank, which declined to comment for this article, finally reached an agreement in August 2010 that extended the loan for five years. It has since been paid off.
Eventually both sides patched things up. Trump and his daughter Ivanka are building a $US200 million luxury hotel at the Old Post Office Pavilion in Washington. Trump has said he is investing $US42 million of his own money into the project.
There is just one loan: $US170 million from Deutsche Bank.