What was once a sure bet ... building a casino ... has turned sour. The $2.4 billion Revel Casino in Atlantic City has just declared bankruptcy after less than a year of operation (see: CNBC Story ). The losses should top $1 billion for the initial investors and Atlantic City will continue to take it on the chin after years of hoopla. This is an oft-repeated story. The casinos in Rhode Island are have been in steady decline for years. I stopped going to them when it became obvious that their payout percentages were being reduced to make up for declining business ... which, of course, caused even greater visitor defections ... a vicious cycle.
Now the native-American casinos in Connecticut, Mohegan Sun and Foxwoods, are also apparently on the downward slope and have extended their hands to Uncle Sam for some more sugar (see: Breitbart Story). Six years ago these casinos were on a building binge ... expanding their gambling, lodging, dining, and commercial retail areas. Now this optimism appears to have been misplaced. Plus, Massachusetts is on the verge of authorizing slot parlors and destination casinos which will surely erode business away from Connecticut. And, if the potential investors in these Massachusetts casinos are the slightest bit perspicacious, they probably should re-jigger their financial models to account for what is apparently a growing aversion to tossing away money on the part of the Supp-hose set.
The chips are down.
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