HC or anyone else, what's up with gaming these days? It almost looks like a microcosm of the economy as a whole, with the rich getting richer and everyone else keeping their heads barely above water. That may be a result of having the money to go into Asia, which is quite profitable, while nothing else is.
I have no idea how the Native American casinos are doing, but they certainly aren't expanding like in the past. Has domestic gaming become a low margin business, on a par with amusement parks? If so, what will happen to Nevada? The whole state seems to live off of gaming, taxing the casinos heavily and everyone else very lightly.
1, zero interest rates kill retired people who now get 1-2 % on their savings hence much less disposable income to gamble, eat out , etc. Many friends in the tennis club have gone back to work because they fear out living their nest egg. Younger people don't get the jobs they would have had if retired people stayed retired or retired when they originally planned.
2, we over built in the boom, too many rooms, tables, restaurants , driving down room rates etc.
3. hot money idiots came to town and added TONS of debt aka leverage by over paying and crushed the industry. imagine if interest rates were normal how many BKs there would be ?
4. mgm built a moronic project on the City Center footprint, if REID didn't step in, MGM would have gone BK, murren admits it was that close.
5. 90 % of americans now live within 2 hours of live gaming crack they don't need Vegas to gamble.
6. do you remember our old gaming group from the boards of, mbay,mir,azr,mgm,byd,stn,prmn boards ? we are still in daily contact, as you know brigham aka, bill passed away, but frank fantini now runs a respected daily gaming letter and he stays on top of the space. If not for macau, the entire space would have gone under a scary thought. take care bud.
btw, the slot makers space is even worse, the other players, konomi, aristocrat, wms, bly, all make the same stuff now, its high quality, margins have gone to sheet. reminds me of the old days when mikn and others threatened me to stop outing their problems or they would go after me, lol, now, you hadly ever see a slot machine fail unless its very old. also,many t-pees are under pressure as well.
Yes, I do remember the old board and the old gang, I do miss them. I remember when Brigam passed, that was sad. Can't say I miss Iwal, however.
No one ever needs to go to Vegas, I think the big operators understand that they have to make the Vegas experience lime no other, more than just gambling. But the locals places in Vegas, like Stations, that's different. They could be down in the dumps for a very long time.
Interesting point you make about interest rates. I don't think I'm ready to invest in PNK as a hedge against higher rates, but at least they might have something to look forward to. PNK owns the closest casino to me, about a 3 hour drive, and it's been there since I moved here in 88. It seems to be a stable business, not too much fear of competition. The nearest Native American casino, in the heart of Mormon country, never made much of a go of it.
I didn't know Mikohn threatened you. I guess you had the last laugh, as far as I know they disappeared without a trace. I sold almost all of my gaming stocks as they were crashing back in 2008, but I held on to a small position in LVS. I'll probably stay with it, they seem to know how to make money.
I imagine I'll let this business cycle play itself out before I look at gaming companies again. And by then, I amy be 100% in index funds anyway.