The economy continued to improve in April, but that did not mean that the stock
market went up. In fact, the Dow and S & P indexes are down about 2 ½
percent since the beginning of the year and the NADAQ is down 7 ½ percent.
It is not easy to understand, the first quarter earning results were generally
very strong, especially in gaming (if one ignores the Donald); the usual economic
measures, such as consumer spending, consumer confidence, job growth and personal
income were up; only the threat of an increase in interest rates, energy prices
and the continuing international tension offer any explanation.
U.S. shoppers turned out in force in March…Separate private-sector
reports on weekly chain store sales showed that this momentum -- fueled by
tax rebates and possibly renewed confidence in the economy and jobs…The
Commerce Department said retail sales rose an unexpectedly sharp 1.8 percent
in March to a seasonally adjusted $333.01 billion, the biggest gain since
March 2003. Excluding cars and trucks, sales gained 1.7 percent, that category's
best performance since March 2000. Jonathan Nicholson, Reuters, Yahoo! Business,
4-13-04
Americans were more upbeat in April about finding a job than
they have been in almost 18 months, causing markets to quickly shift focus
to next week's influential report on the U.S. employment situation. Also consumers
bought a near-record number of homes last month, adding to views the U.S.
economy now might finally be in a bonafide expansion since it began its choppy
recovery from recession in 2001. Amanda Cooper, Reuters, Yahoo! Business,
4-27-04
Optimism among manufacturers about the economy and the business
outlook is also near record levels another report from the Institute for Supply
Management (ISM) showed on Tuesday. The positive news about jobs seemed to
more than offset economists' concerns that soaring gasoline prices, bloodshed
in Iraq and a recent pull-back in share prices might dent consumer confidence.
Amanda Cooper, Reuters, Yahoo! Business, 4-27-04
The Conference Board, a business group based in New York,
said on Tuesday its index of consumer confidence rose to 92.9 in April from
88.3 in March, its highest since January. More to the point, the jobs-hard-to-get
index within the group's survey fell to 27.6 in April from 29.9 in the month
before, its lowest since November 2002. Amanda Cooper, Reuters, Yahoo! Business,
4-27-04
Consumers, an important force shaping the economic recovery,
spent modestly in March, helping the economy log solid growth in the last
quarter. The Commerce Department reported Friday that consumers boosted their
spending by 0.4 percent last month. That followed another 0.4 percent increase
in February, according to revised figures. February's increase was double
the 0.2 percent advance reported a month ago. Jeannine Aversa, Associated
Press, Yahoo! Business, 5-1-04
Americans' incomes, meanwhile, also rose solidly in March,
increasing by 0.4 percent. That came on top of a 0.5 percent gain in February.
The increase was encouraging because income growth is a main factor in people's
willingness to spend in the future, economists said. Jeannine Aversa, Associated
Press, Yahoo! Business, 5-1-04
Gaming stocks suffered the same fate as the overall market in April, except
the Vegas gaming index used by the Las Vegas Review-Journal. The Review-Journal
opines profit-taking as the reason; an early month drop of IGT and Alliance
stock had a more logical explanation: the prospect of a more limited than originally
thought British gaming market. The explanation is certainly logical, but by
month's-end IGT had lost 16 percent and Alliance 23 percent. British gaming
regulations aside, both companies reported earnings up by about the percentage
as the stock prices dropped; go figure.
Profit-taking and investor doubts that Las Vegas can sustain
its ongoing business boom shot a hole in ballooning gaming stocks, which dropped
in price as a group in April for the first time since January 2002. The Dow
Jones gaming index of casino stocks fell to 423.24 in April, down nearly 6.5
percent from March and twice the drop in broad market indicators. By comparison,
the Standard and Poor's 500 Index ended the month at 1,107.30 Friday, down
3 percent compared with March. However, the Applied Analysis Gaming Index,
a weighted average of local gaming stocks, closed at 268.49, up nearly 6 percent
in April compared with March and 81 percent higher than its value a year earlier.
Rod Smith, Gaming Wire, Las Vegas Review-Journal, 5-1-04
British parliamentarians called on the government on Wednesday
to put tighter controls on casinos and slots…recommended an amendment
that would put a cap on the number of Las Vegas-style slot machines a casino
can install and proposed restricting larger "resort" casinos to
areas where they can bring regeneration, such as ailing seaside towns. Katherine
Baldwin, Reuters, 4-7-04
Shares of two major U.S. slot and video poker machine makers
fell this morning as British legislators issued an interim report …shares
of International Game Technology of Reno fell $1.11 per share to $45.36, while
Las Vegas-based Alliance Gaming Corp.'s stock fell $1.26 per share to $32.73.
Liz Benston, Las Vegas Sun, 4-7-04
New British regulations are on the way, and there will be some opportunity,
although it would be impossible for me to guess the details from this vantage
point. The United Kingdom is not the only jurisdiction grappling with new or
expanded gaming. First those, who like the English are not certain what if any
additional gaming should exist in their jurisdiction: Kansas and Maryland opted
out, at least for the time being.
Hours before the end of the 2004 legislative session Monday,
lawmakers killed Gov. Robert Ehrlich's slot machines proposal for the second
consecutive year. Ehrlich's sophomore bid to legalize slot machines died just
as his freshman proposal did: in the House Ways and Means Committee, which
kept the legislation from reaching a full vote in the House of Delegates chamber.
Associated Press, Blood Horse news, 4-29-04
The result was expected. The margin was a shocker. The Senate
on Thursday rejected legislation to expand gambling in Kansas, sending the
issue to an apparent death for the current session. Senators defeated the
measure 26-14 - after giving the bill tentative approval earlier in the day
to send it to a final vote. …Majority Leader Lana Oleen said she does
not anticipate the issue coming up again this year. Pittsburg (KS) Morning
Sun, 4-30-04
On the other side of ledger, four states passed or advanced some form of legislation,
Iowa, Maine, Michigan and Nebraska advanced gaming expansion; Iowa still requires
regulatory approval before any new licenses are granted and Nebraska needs voter
approval, in Michigan a full house is necessary. Four steps forward against
the two steps backward in Kansas and Maryland, four steps that should mean more
slot machines sales of IGT and Alliance.
Iowa Senate approved major gambling legislation…Senators
punctuated the legislative gambling saga with a 37-11 vote after just 45 minutes
of debate. …The legislation also leaves the door open to the possibility
of new gaming licenses after voters in six counties gave a green light to
riverboat casinos. …leaving the final say on new licenses with the Racing
and Gaming Commission. Todd Dorman, Quad-City Times, 4-20-04
The state of Maine is moving forward to set up a Gambling
Board to oversee slots in that state. …Governor Baldacci is expected
to sign a bill this week that modifies the original referendum allowing slots
passed by the voters last fall. …The revised bill, which will go in to
effect 90 days after the Legislature adjourns, also calls for a five member
board to oversee the slots operation. Jeremy Rangiawha, Harness Link, 4-30-04
The state Senate narrowly passed legislation that would allow
expanded gambling at Michigan's seven horse race tracks. The tracks would
be able to add video lottery terminals and slots -- games similar to those
included at the state's 20 casinos -- if the legislation becomes law. Associated
Press, Detroit Free Press, 4-29-04
The Nebraska Legislature approved a measure to put casino
gambling on the November 2 ballot as a constitutional amendment in a 31-16
vote on Wednesday.
Only two casino operations would be allowed under the amendment with their
location to be determined by local voter approval, the Lincoln Journal Star
reports. Slot machines would not be allowed outside the casinos. Thoroughbred
Times, 4-14-04
A couple of states are still in the debate stage of the process; in Pennsylvania,
once thought to be the most likely to pass a slot bill, the legislature is still
trying to find compromises that satisfy everyone; and in Illinois, the attorney
general recommends to the legislature just adding more licenses instead of waiting
for the Isle of Capri/Rosemont operation to begin paying taxes.
The state Senate continues its seemingly endless discussions
over whether to allow slot machines at horse race tracks and to use the $1
billion in expected revenue to lower local property taxes. But no vote is
expected anytime soon…There are at least 10 applications for horse racing
licenses in Pennsylvania, including two in the Lehigh Valley. John M.R. Bull/
Joe McDermott, Allen Town Morning Call, 4-12-04
Illinois Attorney General Lisa Madigan has some advice for
the governor and state lawmakers about the new casino deal. She says if the
state wants to earn any new revenue from casino gambling, the general assembly
had better approve more gaming licenses. …"If they want the revenue
sooner, they could pass another license. That's up to them to decide. But
yes, it is a recommendation that I have made if they are looking to have a
license up and running sooner rather than later. Potentially that would allow
another casino to be up and running without the more as of litigation and
bankruptcy and investigation we currently have surrounding the 10th license,"
said Madigan. Andy Shaw, ABC 7 Chicago, 4-29-04
There are also the long shots, states where a dreamer, casino owner or other
hopelessly unrealistic person proposes legislation, a referendum or just a franchise
granted by the state to bring the excitement and wonderful takes to your state.
Larry Flynt, Caesars, Don Laughlin, Michael Gaughan and Sheldon Adleson are
among the operators trying to convince someone to let them come to town to open
a game and book a bet. There are others with names less well known in Alaska,
Colorado Ohio and Texas who see a very bright future decorated with spinning
reels and wheels. There are legislators in Pennsylvania and Rhode Island who
watched the license bidding wars in Illinois and are anxious to bring that process
into their state. Also, there are other states where constituents have watched
Indian gaming and want a piece of the action for themselves, such as the tracks
and card rooms in California and Washington. Oh, and in New Jersey it would
help if sports betting could be added.
The House Finance Committee on Wednesday passed a bill that
could allow a gambling casino to open in Anchorage. House Bill 552, which
the committee sponsored, would set up a state gambling commission with the
power to allow a single casino in Anchorage. The bill was the idea of Perry
Green, a well-known Anchorage furrier and poker player, who proposes to turn
the failed state-owned Anchorage Seafood International plant into a casino.
Sean Cockerham, Anchorage Daily News 4-22-04
Not to be deterred by democracy, the horse and dog racing
industry's two best friends, Rep. Al White and Sen. Ken Chlouber, have struck
back with a vengeance by repackaging last year's failed initiative as House
Bill 1437. The bill's modus operandi is a computer game whose makers and promoters
insist meets the requirement for pari-mutuel wagering. "Instant Racing"
machines have a video screen that plays reruns from a library of more than
50,000 races. Program numbers spin on a video display like cherries spin on
a video-lottery terminal. The machines accept cash or vouchers, but pay only
in vouchers. The money wagered through the machines goes into a pool and is
paid out according to pari-mutuel standards. Rocky Mountain News, 4-21-04
Polls that looked at Ohioans' willingness to support slot
machines at racetracks found strong support for using profits to fund college
scholarships, guarantee increases in school funding and provide money for
preschool programs, slots proponents say. There was no support for a plan
to let cities vote on bringing in casinos, an idea that racetracks are convinced
would kill the proposal. Andrew Welsh-Huggins, Associated Press, Las Vegas
Sun, 4-29-04
Allowing video slots gambling at horse and dog racing tracks
would create rural jobs and boost Texas' position in the national horse racing
scene, Texas Agriculture Commissioner Susan Combs testified Monday. Both Rep.
Ron Wilson, D-Houston, and Rep. Jim Pitts, R-Waxahachie, laid out separate
proposals to a House education committee that would allow the state to tax
video gambling at horse and dog tracks to help pay for public education. April
Castro, Associated Press, Las Vegas Sun, 4-27-04
Tim Eyman's initiative to use video gambling machines to cut
state property taxes could wind up cutting the income of Washington's Indian
tribes as well, tribal spokesmen say. The revenue at the state's tribal casinos
has risen sharply since they began using the video machines in 1999 as part
of a negotiated deal with the state. As gamblers flocked to the new machines,
which remain illegal off-reservation, revenue at non-Indian gambling establishments
sagged, according to data compiled by the Washington State Gambling Commission.
John Stark, Bellingham Herald, 4-15-04
Assembly Budget Committee Chairman Louis Greenwald (D-Camden)
and assemblyman Jeff Van Drew (D-Cape May) are planning to challenge a federal
law that could allow sports wagering at Atlantic City casinos on the grounds
that it could raise millions of dollars for the state. The drive for sports
betting comes just after an agreement between the state's racetracks and casinos,
announced by Governor James McGreevey on April 6, that would give the tracks
$86-million in purse subsidies… Thoroughbred Times, 4-24-04
Political strategy can be very confusing for those of us who sit on the sidelines,
listen to the candidates' sound bit comments trying to decide who is the best
to represent our point of view; and no office gets more high level strategic
planning than the presidency. Presidential candidates travel the country speaking
to special interest groups and giving interviews always conscious of the biases
of each separate group or place. One simply does not talk about the same things
to Detroit autoworkers and one does with California environmentalists. We have
all heard how Ralph Nader tipped the scales toward the Republicans by pulling
some Democrats to vote for him and not Al Gore. Still, who would have guessed
that putting slot machines on the ballot in Ohio would bring out more Bush voters
and cost Kerry the state? I wonder if that means that the Bush campaign is really
behind the initiatives in California and Washington?
Backers of Democratic presidential candidate John Kerry are
expressing concern about a proposal on the Nov. 2 ballot to allow video-gambling
machines at Ohio's seven horse-racing tracks, including Toledo's Raceway Park.
Jim Ruvolo, chairman of Mr. Kerry's campaign in Ohio, said he opposes putting
the issue on the Nov. 2 ballot because it could energize "evangelical
Christians" who would help President George W. Bush carry Ohio. Mr. Ruvolo
said he has informed aides to Mr. Kerry, the presumptive Democratic nominee,
about his opposition and they share his concern. "Democrats will turn
out for the presidential election. I don't think there is a core constituency
in the Democratic Party for slot machines. I know there is a constituency
among the religious right against gambling," said Mr. Ruvolo, a Toledo-area
resident and former chairman of the Ohio Democratic Party. James Drew, Toledo
Blade, 4-30-04
Though the British have not yet finalized the new regulations, the interest
in the United Kingdom has hardly diminished, unless you count Steve Wynn "dissing"
the whole thing as a waste of time and effort; for Wynn Macau is clearly a better
play.
Gambling giant MGM Mirage and a British developer announced
plans today to build casinos in three cities and an entertainment complex
in a fourth. Las Vegas-based MGM Mirage and Manchester-based Peel Holdings
put the value of the developments in Manchester, Salford, Glasgow and Liverpool
at £600 million. …"All of the projects that we have announced
today, and others that we are still exploring, have the potential to result
in unprecedented levels of inward investment, jobs and tourism for each of
the locations we have chosen," Lloyd Nathan, MGM Mirage managing director
for Europe, said in a statement. The Scotsman, 4-19-04
Steve Wynn isn't a believer in the supposed untapped power
of the United Kingdom gaming market. While Las Vegas-based competitors MGM
MIRAGE, Harrah's Entertainment Inc. and The Venetian owner Las Vegas Sands
Inc. have scrambled to line up deals to tap into what they see as the U.K.
market's incredible upside, Wynn has waited on the sidelines. …"When
people say the U.K. is the market with the biggest upside, it's simply not
true," Wynn said. "I've always been a little skeptical about the
U.K., and I've always thought casino prospects in London were a bit murky."
Jeff Simpson, Las Vegas Sun, 4-13-04
Wynn believes Macau and other Asian markets have the biggest
casino-market upsides. His Wynn Resorts Ltd. won one of Macau's three government-approved
casino concessions, and Wynn hopes to break ground on the company's planned
$500 million-plus Wynn Macau hotel-casino within a couple of months, he said.
Jeff Simpson, Las Vegas Sun, 4-13-04
Rank Group Plc and London Clubs International Plc, owners
of casinos in the U.K., said their expansion would benefit from proposals
by British lawmakers today to further deregulate the country's $3.8 billion
gambling industry. Rank, based in London, welcomed recommendations by the
Joint Committee on the Draft Gambling Bill to overhaul 35-year-old legislation
by, for instance, allowing all casinos to offer bingo and betting and permitting
operators to install larger numbers of gaming machines. Rank and London Clubs
are expanding their U.K. casino operations… Las Vegas Sun, 4-7-04
Whatever the new regulation turnsout to be and regardless of the kind of operations
that result, gaming in the UK is more widespread and often more entertaining
than it is in the United States. Take for example the following three stories:
the Mafia continues to attempt to extort a fair share for their protection services
from online gambling sites in Britain; where was the protection for the casino
that was robbed by thugs with samurai swords and baseball bats; but by far the
most entertaining story, certainly for April, was the man who sold everything
and went to Vegas to play roulette. He doubled his money. Now, why didn't I
think of that? I wonder if the new regulations would have allowed him to go
to Edinburgh, Blackpool or London instead?
A UK-based on-line gambling exchange, Sporting Options, was
hit by a denial of service attack at the weekend in the latest on-line extortionist
assault against on-line bookies. The company's site was rendered inaccessible
for 40 hours in an attack timed to coincide with Britain's biggest betting
race -- the Grand National -- and the FA Cup semi-final…flood of spurious
traffic swamped the site with more than 2 million connections per second,
locking out legitimate users from 8pm on Friday night…until Sunday…incident
followed threats from extortionists that the site would be brought to its
knees unless EUR40,000 was sent via Western Union. Irish Electronic News,
4-6-04
These were the shocking scenes as thugs brandished a 3ft samurai
sword and baseball bats in a raid on a casino. …They finally fled in
a car after taking thousands of pounds in notes from cash machines in the
hold-up in Manchester. Online Sun, 4-2-04
. . .Revell put up his life's worth of $135,300 and bet on
red at the roulette table as a British film crew recorded the event. Liz Benston
and Jeff Simpson, Las Vegas Sun, 4-19-04
He may have wanted the publicity more than the money, as he brought a television
crew with him; not everyone in Vegas, they say, wanted to book the bet however;
it is not politically correct to portray gambling as a way to get rich or pay
your bills. That is, unless a state lottery wishes to advertise buying a lottery
ticket as a ticket to wealth and happiness.
…Revell had approached Caesars Entertainment Inc. with
the idea of making the bet at one of its properties but the company rejected
it, company spokesman Robert Stewart said. "That was a bet that we decided
we did not want to take," he said. Liz Benston and Jeff Simpson, Las
Vegas Sun, 4-19-04
Harrah's Entertainment Inc. wasn't approached with the proposal
but "had (Revell) done so we would not even have come close to participating
in this," spokesman Gary Thompson said. "Gambling is not a way to
solve financial problems. It never has been and never will be. It should be
entertainment and nothing more than that." Liz Benston and Jeff Simpson,
Las Vegas Sun, 4-19-04
In the terrorist world of 2004, one should never be surprised by political
demands, especially demands for national autonomy and independence. However,
it still caught me completely off guard when the unions involved in the Casino
Windsor strike made national autonomy a central issue. Three weeks after the
strike began the casino is still closed, giving Detroit casinos a substantial
boost. One might think a casino labor strike would be about wages and benefits.
Not this one, it is about political parties and American invaders. The call
is: Drive the Americans out, keep Canadian dollars and profits at home: Yankee
Go Home! The union has also managed to turn the sitting government into a critical
issue to be resolved, or at least debated, as part of the strike.
A labor rally for workers at Casino Windsor has demanded more
respect from management, an end to Ontario's Liberal government and for the
casino's American managers to leave. …About 3,500 casino workers have
been on strike since April 3. …Casino workers were joined by union colleagues
representing French and English teachers, University of Windsor faculty, the
public sector and Canadian Auto Workers locals from Ontario communities of
Windsor, Chatham and Tilbury. … Gary Parent, president of the Windsor
and District Labor Council and negotiator in the casino talks, expressed concern
that none of the area's three provincial Liberals showed up for the rally.
He welcomed the attendance of several city councilmen and the city's two New
Democrat Members of Parliament, one of whom called the Liberals cowards. "When
I see the provincial government hiding behind the casino door, saying, `Hands
off, we're not getting involved,' I say that is cowardice on their part,"
said Joe Comartin. Buzz Hargrove, national president of the CAW, said he wanted
Ontario casinos to be run by Canadians. Associated Press, The (South Carolina)
State, 4-26-04
The economy is still growing, though war, fuel and interest rates are worrisome.
Gaming stocks are okay, but suffering a bit from too much good news, not so
good news from England and uncertainty over slow moving legislation. The strike
at Casino Windsor is still there, no revenue costing the province millions every
day; it may not be a trend, no strike in United States has had quite that degree
of an impact, but it certainly shows that the gaming industry is vulnerable
to more than terrorists or economic downturns.
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