I suppose there is a reason so if anyone can enlighten me about this feel free to do so. I, frankly, can’t figure out how a company that derives its revenues from gaming can run into serious financial problems. Sure, I understand that it’s always possible to spend beyond your means no matter how predictable those means may be but to get into real, deep, Chapter 11 type trouble you have to work at it.

The reason I raise the question is that there’s an article in Reuters today that says Trump Entertainment is going to default on its $53.1 million bond payment due on December 1. The reason given is the falloff in Atlantic City business in September and October. In fairness, Trump says they’re going to use their 30 day window to try and work things out. Their stock is currently selling at 31 cents a share so I don’t think that the market sees a high probability of a successful resolution.

This company came out of a Chapter 11 proceeding in 2005 and now they’re staring down the barrel of another one. I suppose that they could have come out of bankruptcy so thinly capitalized that any adverse development would doom them or they simply never learned a thing from the last time around. Whatever, it begs the question as to how Trump’s executives and banks could screw the pooch twice in a short period of time.

Trump Entertainment isn’t systemically important is it?