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The worst financial decision I ever made ..(3)

Posted by andriantoangkadirjo85 on June 23, 2011

Hi all,

How’s your day? Hope everything’s fine. I keep posting about worst financial decision as I still can find stories about this awful reality of life. Interesting right? People had millions only to lost it all..thanks to bad investments, extreme generosity and terrible financial advice. Here’s just their stories :

1. Heiress Patricia Kluge files for bankruptcy

A former socialite, bellydancer and nude model who became known as ‘the wealthiest divorcee in history’ after she split from her billionaire husband has declared herself bankrupt. Patricia Kluge secured a settlement amounting to £1million ($1.6million) a week after the divorce 21 years ago. Mrs Kluge, who had entertained royalty, moguls and celebrities at her sprawling Virginia estate in the 1980s and later tried her hand as a winemaker, filed for personal bankruptcy protection with her third husband.

The 62-year-old Briton netted a reported $1billion after splitting from media mogul John Kluge in 1990. She splashed out on the lavish 45-room Abemarle House, set on 3,000 acres of land in Virginia.

The one-time star of adult film ‘The Nine Acres of Nakedness’ became known as the host of extravagant parties attended by the rich and famous.

But the high-living British woman, who was born in Baghdad, has declared herself bankrupt after she crashed financially and her winemaking business failed. Bankruptcy papers reveal the sad downfall of the former billionaire who has desperately been trying to raise money by selling off her possessions over the past year. She and her husband William Moses estimate have up to $50 million in liabilities, according to bankruptcy filings. A lawyer for the couple, Kermit Rosenberg, said: ‘They’re getting on with their lives, trying to discharge their debts and start over.’

Mrs Kluge acquired the 23,500-square-foot Albemarle House and its 3,000 acres in rural Virginia from her 1990 divorce from billionaire media mogul John W Kluge, who died in September. It was designed after an 18th-century English country manor with multilevel gardens, fountains, a swimming pool and rustic guest cabin.

For Sale

  

In the 1980s, Mrs Kluge hosted opulent events for royalty, corporate chieftains, celebrities and literary figures at the home, which Mrs Kluge once said defined her. The 62-year-old said last year that she no longer lived that life and instead was trying to focus on a winery business she had sought to create with her new husband.

The Chapter Seven bankruptcy petition comes after the failure of negotiations with three principal banks, Mr Rosenberg said. The banks had foreclosed on the couple’s winery business, their Albemarle House mansion and a neighborhood of luxury homes under development. Mr Rosenberg said attempts to ‘structure an overall settlement’ didn’t succeed. He added the filing places the couple’s assets under the control of a court-appointed trustee, who will administer payments to creditors. Bank of America filed a lawsuit against Mrs Kluge in U.S. District Court in Charlottesville, alleging that Kluge defaulted on three loans worth nearly $23 million on the brick Georgian home and its grounds. The bank purchased the property for $15.26 million.

The couple also lost their Kluge Estate Winery & Vineyard after defaulting on nearly $35 million in loans from Farm Credit Bank during their effort to build a national wine business during the economic downturn. Reality-television mogul Donald Trump bought most of the business in April, saying he wants to operate the vineyard. Lender Sonabank took back the couple’s upscale Vineyard Estates subdivision for $4.9 million at a January auction after Kluge and Moses defaulted on an $8.2 million loan after few properties on the 511-acre tract had sold.

The couple’s current home in the subdivision wasn’t part of the sale.

Vineyard

To raise cash for the struggling winery, Mrs Kluge enlisted Sotheby’s last June to conduct an onsite auction of furnishings, antiques and other items, which brought in $15.2 million. An ornate Qing Dynasty Chinese table clock sold for nearly $3.8 million, and worldwide bidders also paid top prices for paintings, furniture and other pieces in the collection. Mrs Kluge also liquidated much of her jewellery for about $5 million at a previous sale.

News of Kluge’s fall from financial grace stirred up a frenzy of Web searches. Over the course of an hour, online lookups for “patrica kluge” spiked as did interest in “patricia kluge bankruptcy” and “patricia kluge broke.”

Declared bankrupt 21 years after she netted a reported $ 1 billion after splitting.

2. Barbara Hutton and Jimmy Donahue.

Frank W. Woolworth was a colossus, a man who started life in the backwoods but went on to build a worldwide business empire and a mighty New York skyscraper the Woolworth Tower, just to remind people how powerful he had become.

He worked every day of his 66 years, and when he died he left the equivalent of a billion pounds in his will. His family blew it all. It has taken the Woolworth company more than 100 years to reach its nemesis. But it took Frank Woolworth’s family a fraction of that time to ruin itself. Woolie’s may be best-known for its pick ‘n’ mix, but the family was a byword for sex, drugs and profligacy. They went from rags to riches and back to rags in three generations.

A few years ago, I bumped into one of the tribe, Mary Woolworth-Donahue, in an out-of-the-way town in Illinois. A reformed alcoholic, she was elegant but penniless and living in someone else’s house. By this point, the fortune had long since vanished. Money, to the Woolworths, was a curse. Unlike families such as the Rothschilds, they never learnt how to deal with it. So they just spent it – and bought their own destruction in the process.

The sad irony of the demise of Woolworth’s stores in Britain is that, for many decades, they continued to exemplify all the virtues instilled by their founder – hard work, cheap goods, a little pleasure – while his family took off in the opposite direction. They despised work and indulged themselves in consumerism and debauchery instead.

The main culprits were FW’s grandchildren, Barbara Hutton and Jimmy Donahue.  Hutton was the original ‘Poor Little Rich Girl’, the child of FW’s daughter, Edna.  Donahue, the fast-talking playboy who was to ruin the reputation of the Duke and Duchess of Windsor, was the son of the old man’s daughter, Jessie.

Hutton, whose mother committed suicide – Barbara found the body – was just seven when she inherited today’s equivalent of a third of a billion dollars.

The counter assistants at Woolworth’s may have been toiling ten hours a day, but she would never have to work. Instead, Barbara Hutton went shopping. As the richest girl in the world, she could have anything – and so she took to shopping for husbands. In the end, she had seven.

In her secret little world, Hutton repudiated her origins and longed to be high-born. It was no coincidence that of her husbands, two were princes, one was a count, one was a baron and one had a title bought for him.

She detested being a plain old ‘Mrs’. Of her many husbands, the most famous was her third, Hollywood aristocrat Cary Grant – while they were together, wiseacres labelled them Cash ‘n’ Cary. Grant got the call to the altar only because he was at the time one of the world’s most famous actors – and he was only too aware that his wife fantasised about being a real princess.

Their marriage barely lasted four years and Grant gave an insight into his wife’s make-believe life as he departed:

‘Barbara surrounded herself with a consortium of fawning parasites – European titles, broken-down Hollywood types, a maharajah or two, a sheikh, the military, several English peers and a few tennis bums.

‘If one more phoney earl had entered the house, I’d have suffocated.’

Nobody who met Barbara Hutton walked away the poorer – how she loved to spend her grandfather’s money. And if people commented, so what? She spent the equivalent of £20 million on building a house in London’s Regent’s Park, now the U.S. Ambassador’s residence, and without a breath dished out half that on a suite of jewels once belonging to Napoleon. She treated upmarket jewellers Cartier, Asprey, Van Cleef and Arpels like other people treated her grandfather’s five-and-dime stores – she’d drop in and help herself to whatever took her fancy.

Her flagrant disregard for propriety – her dictum was ‘If you’ve got it, flaunt it’ – caused her on one occasion to be reminded of where all that cash came from. When Barbara declared: ‘Living well is the best revenge’, it hit the business hard – poor people were reluctant to spend their hard-earned pennies at a business which had such a gargoyle at its prow.

And the workers had to pay the price, by working longer hours for pitiful wages. When American employees noisily threatened to strike in 1938, the executive board blamed Barbara for their troubles. And weeks later, groups of unruly shopgirls were picketing the swanky Pierre Hotel in New York, where Barbara had a suite of rooms, shouting: ‘Barbara Hutton! Is 18 dollars a week too much?’ But she didn’t care.

As time went on, whatever tenuous link with reality she’d once had evaporated completely. Between husbands, Barbara had a string of affairs – among them with Howard Hughes, one of the world’s richest men, and with Porfirio Rubirosa, one of the world’s best-endowed. She demanded sex, often, from the men she was with, yet remained strangely aloof from the process. One lover, after the expenditure of much energy and ingenuity, concluded she was incapable of being satisfied.

And so one of the richest woman in the world was also one of the unhappiest – and took to alcohol and drug abuse on a grand scale. With her cousin, Jimmy, she discovered in her teenage years the dubious delights of Seconal, a barbiturate-based tranquilliser which produced a damaging but lasting high.

It was to prove her downfall. But compared with Jimmy, Barbara was a mere innocent.

The son of Frank Woolworth’s second daughter, Jimmy was born bad. Knowing he would never have to work in his life, he devised a career for himself – that of mischief-making. There were many pranks. But the best was taking the Duchess of Windsor to bed.

Jimmy first met the Duchess at the Palm Beach Palace hotel, which he called home, in 1941. He was 25 and she was 44. But it was probably Jimmy’s predatory mother, Jessie Donahue, who encouraged her son, nine years later, to make overtures to the Duchess. Certainly she paid for Jimmy’s first-class ticket on the RMS Queen Mary as it slipped away from New York on May 24, 1950, heading for France. The couple started the journey as mere acquaintances, but they ended it as lovers. For the next four years, they were inseparable as the poor, ageing Duke played the tormented cuckold.

Nobody else suspected, because Jimmy – until this point – had been a hugely promiscuous homosexual. He had tribes of gay lovers, most of whom refused to believe he could have a sexual relationship with a woman. But Jimmy did.

By 1950, the Duke and Duchess of Windsor had been married for 13 years and had been lovers for 16. But their relationship was largely one-way traffic, with the Duke gaining gratification from his hectoring and abusive wife while she refused sexual satisfaction.

But with Jimmy, everything changed. The Duchess, when in Paris, would go out with the Duke and Jimmy as a threesome – but the Duke, tiring now of long hours spent in nightclubs, would go home at midnight. The Duchess and Jimmy would then repair to the black, satin-lined apartment of socialite Count Jean de Baglion, overlooking the River Seine; and her car would not return home until after dawn.

‘She married a King, but screwed a queen,’ the Count was heard to sourly observe of the Duchess’s affair with the homosexual Jimmy. The Duchess would go home and leave notes on her bedroom door: ‘Go away. Stay away. Don’t come in here.’

Jimmi and Duchess of Windsor

Meanwhile, the Duke, who only a few years earlier had given up throne, empire, riches and power for ‘the woman I love’ was forced to sit out his wife’s menopausal fling with a gay playboy young enough to be her son. One day, more of a joke than anything else, Jimmy proposed marriage to the Duchess. And she didn’t say no.

In America, where she hailed from, the name Woolworth meant a whole lot more than the name Windsor. What, apart from her reputation, was there to lose?

In the end, wiser counsels prevailed – and Jimmy was getting bored anyway. There was a row, Jimmy kicked her on the shin, drawing blood, and finally the tiny Duke gathered up enough courage to shout: ‘We’ve had enough of you, Jimmy. Get out!’ Jimmy walked. It meant goodbye to a large slice of the high-life for the Windsors. For during the length of the affair, Woolworth money had bankrolled the couple – who caved in to the onslaught of money, gifts, holidays, cars, foreign travel and jewellery which Jimmy and his mother Jessie showered on them. Woolworth money had brought the former King-Emperor to his lowest point – one night, he’d even worn the diamond cufflinks Jimmy had given him as a present for bedding his wife.

Jimmy went back to the life he’d known before, queening it round the Fifth Avenue bars strictly reserved for New York’s uppercrust gay set. When people asked him about the Windsors, he would say: ‘Oh, them! Don’t you know I’ve abdicated?’ His life continued on a downward spiral of drink and drugs. Though it was never proved (because the police, in receipt of Woolworth kickbacks, had no desire to prove it), Jimmy almost certainly murdered his boyfriend, the unfortunately named ‘Lucky’ Morra, by force-feeding him drugs, and soon there seemed nothing left to live for.

When he died in 1966, of a drugs overdose, Jimmy was found in his Fifth Avenue bedroom – which contained nothing but a bed and 13 framed photographs of the Duchess of Windsor. His mother, when told the news of her son’s death, glimpsed the social oblivion that was soon to encompass her and uttered: ‘Oh! This is the worst thing that can happen to me!’

But what of Jimmy’s cousin, the Poor Little Rich Girl? Her biographer David Heymann recorded that by now, Barbara Hutton’s daily diet consisted of 20 bottles of Coca-Cola with spirits (usually vodka), intravenous megavitamin shots mixed with amphetamines, a soybean compound, cigarettes, and a cocktail of drugs, including codeine, Valium, and morphine. Away with the fairies, she married a Vietnamese chemist working for a French oil company and bought him an Indo-Chinese princedom from the Laotian embassy in Rabat. She went to her grave as Princess Raymond Doan Vinh Na Champassak, the wife of a nobody. 

The Woolworth family, like the stores that today still bear their name, had truly lost their way.

andriantoangkadirjo85 bottom line :

– They all just spending money like drunken sailor! Turn Millions into Zero!

– Easy come, easy go!

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