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Quick-takes: The month's trends in a glance - December 2003
31 December 2002
By Ken Adams
The economy in December wasn't much different than the rest
of the year. The stock market was down for the month; the DOW began the month
at 8902 and ended at 8341. 2002 was the third year in a row in which the DOW
declined. The DOW began 2000 at 11,501, 2001 at 10,790, and 2002 at 10, 021.
Individual wealth, savings and retirement funds slide away when the value of
stocks declines. The economy struggled and bumped along in December as it has
the entire year, driven by consumer spending, funded by lower mortgage rates
and refinancing.
Households' Net Worth Drops. Slumping stocks took a heavy
toll on the balance sheets of U.S. households in the third quarter, according
to report on Thursday from the Federal Reserve. In its quarterly "flow
of funds" report, the Fed said the net worth of U.S. households and
nonprofit organizations totaled $38.315 trillion at the end of the third quarter,
down by $1.811 trillion from the second-quarter total. About half of the decline
was caused by a drop in stock values, which dipped by $948.8 billion.
Helping offset that loss was a gain in home values. Household real estate
values gained $180.8 billion to $13.414 trillion, the Fed said. Jonathan Nicholson, Yahoo Business, Rueters, 12-5-02
Consumer Confidence Unexpectedly Drops.
NEW YORK - Consumer confidence unexpectedly
fell in December as the outlook for employment worsened, energy prices rose
and the stock market slumped during a period of heightened uncertainty around
the globe. Brad Foss, AP
Business, Yahoo Business, 12-31-02
Retailers Report Modest November Sales. A bigger-than-expected
buying spree over Thanksgiving weekend brought some relief to the nation's
major retailers, but their overall sales gains for November nonetheless were
modest. Anne D'Innocenzio, Associated Press, Yahoo Business, 12-5-02
Jump in New-Home Sales Sets Record. New-home sales jumped
5.7 percent in November to the highest monthly level on record… … In November,
the average interest rate on a 30-year fixed-rate mortgage was 6.07 percent,
down from 6.66 percent for the same month a year ago. This week, rates
on 30-year mortgages dropped to a new low of 5.93 percent, Freddie Mac,
the mortgage giant reported Thursday. Low mortgage rates this year have been
feeding a flurry of home mortgage refinancing activity. The extra monthly
cash consumers are saving by refinancing their mortgages at lower interest
rates is helping to support consumer spending, which has been the main force
keeping the economy going this year. Jeannine Aversa, Associated Press, Yahoo
Business, 12-27-02
The loss of individual wealth and retirement funds and a generally
weak economy affects the way people spend money. The amusement park industry
has been affected, the airlines industry has been affected and the casino industry
has been affected. Growth in casino revenues has slowed to a trickle, except
some of the relatively new Indian casino jurisdictions, as reflected by the
reported results in Colorado, Illinois, Michigan, Mississippi, New Jersey, Nevada.
"For the first time in recent memory, there was a strong correlation
between the state of the economy and a decline in attendance," Tim O'Brien, Amusement Business, Vol. 114, No. 51, 12-23-02
Detroit Casinos' Revenue Dips. Total revenues at the casinos
edged down 1 percent in November compared with the same period a year ago.
October results also were down a notch. Previously throughout 2002, growth
rates at the bare-bones casinos ranged from 5 percent to 29 percent. Becky Yerak, Detroit News, 12-26-02
Illinois November gaming revenues fell 4.2% to $143.1 million.
Gaming Industry Weekly Report, 12-16-02
Year-to-date, Clark County revenue is down 1.7%. …Atlantic
City revenues grew (only) 3.9% in October. …The party is slowing down…Colorado
revenues declined 1.5% in October. …Mississippi revenues gained 2.7% in October.
Gaming Revenue News, Vol. 16, No.12, December 2002
Racetracks across the county are fighting for their lives and
in every case that means lobbying for slot machines. The election has passed,
and now the campaigns begin for real. The California association has made slot
machines its top priority; in New York and Pennsylvania there is pressure to
move forward quickly and Kentucky is seeing its first billboards. The move
toward slots has attracted lots of attention from operators and investors; Racinos
have suddenly become plumbs to be picked by the larger gaming corporations,
as the competition to get the locations and licenses heats up.
Thoroughbred Owners Say Gambling Expansion
Is Top Legislative Priority. …The legislative
committee of the Thoroughbred Owners of California (TOC) has listed legalizing
slot machines at California's racetracks as its top priority for 2003.
The committee would also like to increase the number of satellite wagering
facilities within the state. Yahoo Business, PRNewswire, 12-19-02
Racetracks Push Hard For Gambling Deal.
Harness industry sees doom without video lottery terminals. Whether New York
horse racing tracks will get slot-machine-like terminals is a "life or
death" situation, said the president of the Western New York Harness Horseman's
Association. And that life-or-death scenario is expected to play out early
next year when racetracks across the state meet with state legislators to
determine a better revenue-sharing formula for the potentially lucrative gambling
expansion. Joseph Spector, Rochester Democrat and
Chronicle, 12-27-02
Kentucky Horse Industry Group Launches Legislative Campaign.
The Kentucky Thoroughbred Association has launched its initial lobbying effort
for this year's General Assembly session, renting a billboard at one of Frankfort's
busiest intersections to tout the horse industry's financial impact on the
state. What the billboard does not say, but what KTA officials hope will come
across to legislators and constituents, is that the thoroughbred industry
is important enough to merit assistance, perhaps racetrack slots legislation.
Associated Press, Blood Horse Magazine,
1-2-03
Experts See 'Racinos' Re-Shaping Gaming. Tucson, Arizona - Over the next five
years, virtually all of the racetracks in the United States will offer banks
of slot machines -- creating mini-casinos… The instantaneous growth in
profits witnessed by horseracing tracks that introduce slots will prompt casino
companies to look at alternatives to full-blown casinos, Ron Barbaro, chairman
and chief executive officer of the Ontario Lottery & Gaming Corp., told
attendees at the Racing & Gaming Summit last week in Tucson. "For
one-tenth the cost of Bellagio, we outfitted all of our tracks (with slots)
and generate $20 million a week of gross profit," he said… Liz Benston, Las Vegas Sun, 12-18-02
Even in England, the home of the sport of kings, machines make
more money than more traditional wagers.
Gaming Law Invoked Over Machines. The gaming board is set
to take Britain's bookmakers to court to challenge their right to offer customers
access to lucrative electronic betting machines. The board believes that
the fixed odds betting terminals, which offer a number of games including
roulette and bingo, should be reclassified as gaming machines and therefore
subject to significant restrictions. … The machines have proved to be a highly
popular and profitable innovation for high-street bookies. Hilton, owners
of Ladbroke, said last month that over 1,000 have been installed in its shops
with a further 1,000 planned by the first quarter of 2003. Weekly turnover
from them at Ladbroke is in excess of £11m, which equates to annual profits
of around £14m and so far only 20% of its shops have them installed. -
Ian Griffiths, The Manchester Guardian, 12-9-02
The move to slots to shore up a declining industry, horse racing
and horse race wagering, comes at a time when the integrity of racing is being
questioned as never before. Fixing a race used to mean tampering with the horse
or the jockey, today it means tampering with the technology that takes the wagers
and reports the results. The big scam of the year is still under investigation,
but today it has a new wrinkle. A player straight out of Guys and Dolls, Jimmy
the Hat, has filed a class action lawsuit, claiming millions in lost winnings,
(or is it Winnings Lost? Did Milton write that?) due to the tampering with
the technology.
Autotote To Face Class Action Lawsuit.
Autotote Systems Inc., which handles roughly 65% of all pari-mutuel wagering
in North America, will be served on Wednesday with a class action lawsuit
for negligence. …on behalf of gambler Jimmy "Jimmy the Hat"
Allard. …The lawsuit will charge Autotote with negligence and allege that
"the betting public may have been cheated out of countless of millions
of dollars the past eight years, with the Breeders' Cup fraud being the first
time it has been discovered." Thoroughbred Times, 12-3-02
Speaking of lawsuits, December produced two more tobacco like
suits, where players blame the casinos for their gambling. Neither case is
a class action, but the stage is being set.
Gamblers Sue Over Addiction.
Ontario case among rising number faced by gaming industry. In his first gambling
experience, Constantin Digalakis amassed more than $10,900 in winnings over
two days at Casino Windsor, a Canadian gambling parlor only minutes from downtown
Detroit. …Five years later and after being diagnosed as a pathological gambler,
Digalakis has turned to the legal system to recoup nearly $192,200 in losses
at government-owned Casino Windsor. Becky Yerak, The Detroit News, 12-10-02
Gambler Sues Casino Over Losses.
Evansville, Indiana - David N. Williams, an Evansville accountant,
lost his life savings at Casino Aztar's slot machines. He blames the casino
-- and now argues that it should compensate him. In an unusual suit filed
in U.S. District Court in Evansville last year, Williams, 53, accuses Aztar
of targeting him as a compulsive gambler after it received information that
he was depressed and suicidal. The case raises a pivotal legal question:
What responsibility -- if any -- does a casino have to stop a compulsive gambler
from gambling? Grace Schneider, Courier-Journal, 12-24-02
Just say No! The discussions over compulsive gambling are leading
to new regulations. Up to this point, regulations to control gamblers are in
jurisdictions outside the United States. Australia has taken the lead, limiting
hours, smoking, wagers and slots machines. Nova Scotia has taken one step further,
slot machines that tell you how long you have played, and then tell you no.
Slot Machines In Nova Scotia Tell Gamblers
When They've Had Enough. Your mother, your brother
or your best friend might be the one who tells you when it's time to quit
gambling and go home. But in the Canadian province of Nova Scotia, the slot
machines tell gamblers when they've had enough. During the past 18 months,
all 3,234 government-owned video lottery terminals scattered in 550 bars and
restaurants throughout the Atlantic coastal province have been refitted or
replaced by games with responsible gaming software that decidedly does not
soft-pedal its message. Pop-up screens that halt play for up to a minute
advise players how long they've been at it after 60, 90 and 120 minutes. After
150 minutes, the machine shuts down and automatically cashes them out. Rick
Alm, Kansas City Star, 12-11-02
Other industries are suffering from the recession and are looking
for other revenue to boost declining sales. In England, one of the world's
largest and most famous retailers, has decided to roll the dice online to strengthen
its revenues. And now that Internet technology allows for live dealers, we
can look forward to chatting with a clerk in London while she wraps a purchase
and spins the roulette wheel. If Harrods succeeds, can McDonalds, Pennys and
Starbucks be far behind?
Harrods To Reopen Its Online Gaming
Casino. Harrods is poised to reopen its online
casino. Top people will be able to play blackjack, roulette, baccarat and
take their chances on the slot machines over the internet in the new year.
… Harrods will not provide data on the financial success of its online casino
but it is understood to have become an important revenue stream. The luxury
store is convinced that it has found a balance which encourages gamblers to
visit the online casino in numbers without undermining the integrity of the
underlying retailing brand. - Ian Griffiths, The Manchester Guardian,
12-9-02
Online Casino Introduces Live Dealers.
In the race to develop an ever more realistic Internet gaming environment,
GoldenPalace.com has taken the lead with the recent launch of their new live
casino, Golden Palace LIVE. Cyber gamers can now play Roulette and Blackjack
with a real person spinning the wheel and dealing the cards, rather than a
faceless, computerized dealer. The Golden Palace LIVE software is included
with the original GoldenPalace.com download, and the live video feed can be
viewed by dial-up and broadband users alike. Players can even chat with the
dealers in real time while playing. Yahoo
Business, PRNewswire, 12-16-02
Racetracks want slot machines. Indian tribes have casinos.
Department stores have online casinos. The competition for the 'gambling dollar'
has never been so fierce. In fact gambling has pretty much become a commodity.
Under the pressure of competition, hundreds of strategies have been developed.
Reno, Nevada has tried to become an action adventure destination, tribes in
Arizona and California have lobbied for more slot machines, and Atlantic City
is building more rooms and adding more shopping and attractions.
Las Vegas has always led the way in creating a unique attraction,
but even Las Vegas has been forced to do more. Here are few of the ways that
Las Vegas and Las Vegas casinos raise the bar.
Public Transit Becoming Part Of Vegas Experience. …the city
of neon, flash and fun is applying its rebellious spirit to the usually unglamorous
world of public transportation. While many gamblers, conventioneers and sightseers
still cruise the Strip past behemoth hotels and casinos in rented convertibles
or limousines, public transit has quietly become a big part of the Vegas experience.
And it's about to get bigger -- and flashier. …If that's not unusual enough,
Las Vegas plans to become the first U.S. city to operate European buses that
steer themselves. They're expected to hit the road next summer. …Soon, the
Strip will offer a flashier transit option -- a sleek monorail dressed in
neon. "It will make you think of Disneyland," said Cam Walker,
president of the firm managing the monorail. The $650 million monorail system….is
due to open in early 2004. Michael Cabanatuan, San Francisco Chronicle, 12-27-02
Las Vegas No. 1 Destination for Tradeshows
in 2003. Las Vegas ranks No. 1 among cities in the U.S. and Canada
for number of tradeshows planned for 2003, according to the Dec. 2 issue of
Tradeshow Week magazine. …Las Vegas is slated to host 163 major tradeshows
in 2003. Its closest competitor is New York City (141), followed by Toronto
(140), Chicago (127)… Hotel
Online, 12-24-02
The Maloofs' Vegas Venture Is NBA-Friendly.
When owners of a luxury hotel also own a professional basketball team, they
quickly figure out how to make a 7-footer feel right at home. …For its special
niche, the Palms created 24 special "NBA rooms," 600-square-foot
junior suites complete with 32-inch televisions, XXXL plush terry bathrobes
and a view of the Strip. The ceilings are 10 feet high. The rooms' "NBA
King" beds -- not to be confused with the NBA Kings of Sacramento --
are 18 inches longer than standard king-size mattresses. The shower heads
are 7 feet up. "We're the only hotel in Las Vegas with NBA beds,"
said Maloof. "We designed this property to appeal not only to the local
crowd, but to celebrities and athletes. We're a little smaller than others,
and people like the intimacy. "The hotel's relatively small overall
size helps it cater to its well-known clientele." Debbie Arrington, Sacramento Bee, 12-26-02
Blame It On The Rio -- the one
in Las Vegas, that is -- for jump-starting an entertainment trend of dress-to-thrill
nightspots that have become as ubiquitous as belly-buster buffets in Sin City.
The all-suites casino-hotel on Flamingo Avenue just west of the Strip opened
Club Rio and the VooDoo Lounge in the early 1990s, targeting a young-adult
clientele that Vegas had simply been ignoring. But there was no ignoring the
long line of twenty-somethings that snaked through the casino waiting to get
in to the Rio's dance club, and other hotels quickly followed suit. …Now,
the Rio, where it all started, is trying to take the lead again with a club
that represents a stark departure from the slinky pretentiousness of the chichi
hot spots to something both more casual and, quite frankly, risque. BiKiNiS
at the Rio, the latest entry in the highly competitive scramble for the Vegas
club crowd, has a South Beach theme. In keeping with that theme, waitresses
wear, what else, bikinis and a filmy sarong. Bill Ordine, The Philadelphia Inquirer, Knight Ridder/Tribune
Business News, 12-30-02
And for a little touch of irony. Dennis Gomes first became
famous in Nevada for leading the Nevada regulators' charge against organized
crime. Gomes, through his relentlessness, diligence and attention to detail
broke the back of the infamous Stardust scam and ushered in the era of internal
controls. Today, Dennis is an operator in Atlantic City and for the next year,
leading the gaming industry in its lobbying efforts to reduce the burdensome
level of regulation in New Jersey.
Aztar Exec Ready To Lead N.J. Casino
Association. Property-tax hikes, streamlined
regulations and more political clout - and the unexpected. Dennis Gomes said
he's prepared to tackle it all as incoming president of the Casino Association
of New Jersey, trade group for the city's $4.6 billion gaming industry. …Gomes
said a chief goal is to avoid another hike in the city property tax. …Gomes
wants to push gaming regulators for faster approvals of slot machines and
gaming equipment. The pace of technology advances is causing rapid changes,
further burdening the Division of Gaming Enforcement's famously slow approvals
process. … Gomes said he'd like to see the industry put its financial
and human clout to work in politics. Casinos are barred from contributing
to local and state campaigns, a rule he said should be changed. Joe Weinert, The Press of Atlantic City, 12-5-02
Related Links
Recent Articles
Best of Ken Adams

Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers. Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards. Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.
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Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers.
Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards.
Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.
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