Monthly Archives: July 2009

Getting to the point

July 17, 2009 8:39 am

It’s never too early to start planning your next writing workshop, particularly if you’re planning to be in Cape May, New Jersey next January 15-18. If you’re inclined towards brief non-fiction (and who isn’t…except for those of us who like lengthy fiction?) you may want to consider beating the crowd and registering now for one of the eight seats in this session:

To the Point: Short Creative Nonfiction – NEW!

Limited to 8 participants

Have an idea for a story or article but not sure how to get started? Have a mix of personal experiences and outside research but don't know how to combine them? Thoughtful prodding, expository exercises, group workshopping and inspired revision will help you build your ideas and notes into a finished 500-2,000 word piece suitable for publishing in a magazine or newspaper. (Led by Dave Schwartz)

via Prose Workshops | Winter Poetry & Prose Getaway in Cape May, NJ.

Visit the Winter Poetry and Prose Getaway site to learn more about this and every thing else that goes on at the Getaway. There are a great many other workshops, including one led by Pulitzer-Prize winning poet Stephen Dunn. The faculty is an incredibly diverse and talented group of poets and writers, so no matter what your literary interest, you should be able to find something to suit your tastes and level.

If you are an educator, you can get professional development credit for attending, and you can even earn graduate credits through Rutgers University. Even if you’re not, it’s a relaxing, rewarding weekend writing retreat that stacks up pretty well next to a weekend in Las Vegas. Registration and a single room package (which includes three days of breakfast and lunch and evening receptions) is $795. If you want to share a room, the price per person drops to $635. Register by November 15 and get a $25 Early Bard discount. That’s not bad for three days of dining, writing, and entertainment. The only extra thing you pay for is dinner. No exorbitant charges for bottle service, no need to try the $20 trick to get a sweet room (most have ocean views), and no worries about getting trick-rolled by your new “friend” who wants to “party” with you. Good times.

There are some great deals in Las Vegas right now, but this is a pretty good deal, too. The Grand Hotel in January is sort of the anti-Strip, so this might be a nice change of pace for some of my readers who usually gravitate to the glitz of the Strip.

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Book Review: L.A. Noir

July 16, 2009 7:45 am

John Buntin. L.A. Noir: The Struggle for the Soul of America’s Most Seductive City. New York: Harmony Books, 2009. 409 pages.

In this lengthy exposition of Los Angeles police and corruption, John Buntin examines the career of two Angelenos: Bill Parker, who became one of the LAPD’s most important–and controversial–chiefs, and Mickey Cohen, who occupied a similarly influential position in the city’s criminal underworld. Buntin positions the men as bitter enemies, structuring the book with alternating chapters (for the most part) charting the me n en route to their inevitable collision course. But while neither man liked the other, and both’s paths crossed several times, they weren’t really destined to clash in a final, terrible battle. Cohen ultimately went to jail for tax evasion, not for any crime that Parker’s LAPD had investigated, and Parker was more seriously threatened by larger social problems (chiefly LA’s changing demographics and larger social issues that led to an increase in crime) and interdepartmental and city-level political sniping. So the set-up, while well-executed, eventually rings false, as neither man figures heavily in the demise of the other. Nor did they have, it seems, a truly personal antipathy. Cohen would have been harassed by any LAPD chief who wasn’t on the take, and Parker attempted to crush criminal kingpins, subversives, and garden-variety criminals with the same zeal.

That being said, this is an interesting book. Buntin has researched both men well, and does a good job of re-creating the Los Angeles and the LAPD, circa 1930-1970. He’s obviously spent a great deal of time poring over newspaper accounts, LAPD files, and several biographies and memoirs in recreating the world that Cohen and Parker rose to power in. Those interested in the history of American organized crime will likely be generally familiar with Cohen’s career, but they will still learn some interesting tidbits about him, the LA organized crime scene, and the LAPD. Likewise, Los Angeles history buffs will find this great reading and may see the city in a new light.

I found several insightful things in the book that relate directly to Las Vegas gambling history. When Cohen arrived in Los Angeles as an adult (after a childhood in LA, he had lived in Cleveland and Chicago, among other places), he assumed a place in the city’s organized criminal hierarchy below Ben “Bugsy” Siegel, who’s obviously got some connections to Vegas. Buntin correctly identifies Siegel’s true role in the Flamingo, not as its founder, but as usurper. He also puts Siegel into his proper context, as a criminal entrepreneur with many irons in the fire, some of them (such as the wire service) more lucrative than the Flamingo. Siegel’s murder in Beverly Hills isn’t linked concretely to the Flamingo, as many in Las Vegas would have it, but instead is treated as the unsolved crime that it is. Dozens of people had good reason to see Siegel dead, and most of them had nothing to do with Las Vegas.

Buntin also brings in, for a few moments, two integral Los Angeles figures who transitioned to Las Vegas. Gambling boat operator Tony Cornero and formed LAPD captain and gambling hall owner Guy McAfee. Cornero built the Meadows in Las Vegas in 1931, but is better known for starting work on the Stardust, though he died before it was completed. McAfee owned shares in several Vegas casinos but is most closely associated with the Golden Nugget, over which he presided for many years. Both are interesting figures, and while there probably isn’t enough material to justify a full-scale biography of either, each deserves at least a chapter or two in a prospective book about the connections between LA and LV.

For me, this book was a good read, and if you are interested in Las Vegas history you’ll probably like it for fleshing out the LA crime scene in the years that Vegas was ascendant. The “story” of the book–the struggle between Cohen and Parker–actually takes a back seat to their separate lives.

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Another day, another bad marker case

July 15, 2009 11:57 am

Along with word that business in Las Vegas is “bouncing along the bottom,” the big news today is the latest in celebrity bad marker cases, former NBA star Antoine Walker. From the LVRJ:

Walker faces three felony counts related to writing bad checks at Las Vegas casinos between July 2008 and January 2009. According to the criminal complaint, Walker wrote six checks worth $100,000 each at Caesars Palace around Jan. 19. Before that, the 12-year NBA veteran wrote $400,000 worth of checks for chips at Red Rock and Planet Hollywood, prosecutors say.

Walker has paid back a portion of the money but still owes $822,500.

via Walker charged with writing bad checks to casinos – Sports – ReviewJournal.com.

I did a quick interview on this subject with KVVU (Fox 5) this morning, so I’ve got a few thoughts.

First, for some reason, as I read the story, I kept thinking that he got a marker for $400,000 in red chips. And the old CCTV operator in me said, “That’s four thousand stacks.” I assume that even though he was playing at Red Rock, he did not receive the money in $5 chips.

Anyway, the serious stuff starts here. Why do casinos even offer credit play? That’s a common question. The answer is that we’re talking about sums so big, few people are going to be bringing in cash, and if they are, the IRS may start to get suspicious, since most legitimately high-wealth individuals don’t walk around with hundreds of thousands of dollars on them. There is a detailed process, filled with internal controls and external checks, before someone is granted credit. Generally speaking, the casino investigates the player’s credit history and, if they seem to be good for it, lets them sign a marker.

Why are unpaid markers considered bad checks? That’s a very good question, and the best answer is that this is because that’s what the law is. Why is that the law? I haven’t been able to find much on the legislative debate over the bill that made gambling debts legally collectible in 1983, but I imagine that the casino industry had a fair degree of input into the process.

How much money are we talking about? In 1998, attorney Bob Faiss estimated that between 5 and 15 percent of all money wagered at all Nevada casinos is bet on credit. If you’re interested in the mechanics of casino credit, Faiss’s testimony before the National Gambling Impact Study Commission is as good a summary of any of the process.

For fiscal year 2008, gamblers wagered about $232.4 billion dollars in Nevada casinos.* Five percent of that is about $11.6 billion. Fifteen percent is approximately $34.9 billion. For the sake of argument, let’s assume that the number is ten percent of all money wagered in Nevada casinos. In that case, we can say that Nevada casinos extended about $23.2 billion in credit during fiscal year 2008.

According to the Nevada Gaming Abstract, in that year casinos statewide reported a total of $132.1 million as “bad debt expense,” i.e., uncollected markers. That seems like a lot of money, and it is. Compared to annual gaming revenues of about $12 billion for that period, though, it doesn’t look so big (“only” 1.1 percent). Next to the estimated total credit play, $23.2 billion, it’s tiny: 0.56 percent. Just over one-half of one percent of casino markers end up as bad debts.

That’s probably worse than a commercial bank’s lending rate, but isn’t that bad. According to a recent news story, Bank of America, one of the largest banks in the US, is writing off more than 10 percent of its credit card loans.

While more alarmist elements may imagine that there’s a tidal wave of bad credit decisions and unpaid markers coming from Nevada casinos, looking at the numbers shows that this isn’t true. Only a small percentage of markers end up unpaid, and it seems that casinos do a pretty good job of due diligence before letting players sign markers. Of course, a few high-profile cases gives a much different impression.
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*If you want to check the math, divide the total table and slot revenues by their respective win percentages, then add them.

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Surveillance talk coming to UNLV

July 14, 2009 11:10 am

You’ll have to wait until September, but you’ll be able to hear surveillance expert Derk Boss discuss current trends in casino surveillance and loss prevention. Here’s the summary:

September 3, 2009
Gaming Research Colloquium Series: Derk Boss, DJ Boss and Associates
“Behind the Camera: Current Trends in Casino Surveillance and Loss Prevention”
Thursday, September 3, 2:00PM
Extended Study Area, Lied Library
View flyer (pdf)

For more information, see the UNLV Center for Gaming Research events page.

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The great link?

July 13, 2009 8:34 am

Harrah’s had announced–in very unspecific terms–what it plans to do with its fantastic assortment of Strip acreage. From the LV Sun:

They didn’t announce their intentions at the time. The economy was still humming, and with tourism booming and new resort construction expected by consumers and demanded by investors, the decision was something of a dirty secret.

Their plan was nothing less than a rejection of the implosion-punctuated business model that has defined Las Vegas for decades. In place of a new casino resort, Harrah’s came up with an idea that was more Bourbon Street than Las Vegas Boulevard.

Internally dubbed “Project Link,” the plan calls for a collection of about 20 restaurants and bars to be built along a winding corridor between the company’s O’Sheas and Flamingo casinos, on the east side of the Strip.

With a mix of “eclectic” and “mostly casual” restaurants and bars opening to the street, it’s an attempt to create the kind of entertainment district that has developed organically in cities such as Los Angeles, Memphis and New Orleans yet is lacking on the Strip, with its enclosed, casino-centric zones.

via Harrah’s plans new ‘street’ of bars, eateries near Strip – Las Vegas Sun.

This may be a great idea. Or it may be an underwhelming under-utilization of an expensive, unbroken swath of Strip real estate that stretches from Harrah’s to Paris and just about the I-15 and Koval.

Positives: Harrah’s built itself as a company that caters primarily to the middle market. This move caters to the middle market. Harrah’s isn’t going to be borrowing a great deal of money anytime soon. This project sacrifices minimal cash flow and should be less expensive than building something from scratch. Between Wynncore, Bellagio, and Aria, there is going to be a great deal of competition for the finite high-end market in the near future. This doesn’t threaten to intrude into that market.

Negatives: Harrah’s has assembled a pretty big portfolio on the Strip, and it’s hard to see how Project Link takes advantage of this. As the first phase of something bigger, this could be a great idea. Indeed, the artist’s rendering shown in the Sun article has a great deal of undeveloped space fronting Koval. But if this is it, it doesn’t seem to take advantage of all of that land. Besides that, there really aren’t any.

On the other hand, things don’t look so hot for Imperial Palace. Its Strip frontage seems to be replaced by a massive billboard for a show across the street, kind of like when Bally’s was wrapped with a mega-size ad for “The Producers.” Clearly the casino is still there, but it’s not going to be as visible a part of the Boulevard as before.

I think that Project Link is, overall, a positive, in that it rejects the cookie-cutter thinking that’s permeated the industry. Just because Steve Wynn can profitably cater to the high end doesn’t mean everyone can. I think it’s about time that companies started focusing on their strengths and presenting distinct products as opposed to trying to do the same thing.

In a sense, I think that Project Link will solidify Harrah’s Strip holdings as the anti-City Center. Instead of a newly-built collection of luxury hotel space with a single big casino, you’ve got an assembly of already-built mid-size and larger casino hotels. Outside of Caesars Palace, there’s not much retail. If the Crystals and Aria are the axis of City Center, you couldn’t pick a better contrast than Project Link’s food court (which is essentially what it sounds like) and O’Shea’s/Flamingo.

Whether Project Link is heralded as a brilliant strategic move in ten years depends, I think, on how City Center does. If it’s successful, then this will probably be scuttled mid-way in about 2 years and replaced with plans for something more upscale. If it doesn’t, this will be seen as genius.

Will City Center be a success? We don’t know yet. There are just too many variables. Room rates are down, but high-end play seems to be up. What’s that going to mean in December? It’s anyone’s guess. The political and economic situation is just too fluid to make any predictions with any real confidence. Even if the project comes in under budget and is executed flawlessly (neither of which seems to be true), if gas rises to $5/gallon and airline capacity continues to fall, it’s hard to see how it would be a success. On the other hand, if 42 million people have the means and desire to visit Las Vegas in 2010, it’s hard to see how it wouldn’t make a ton of money. The most frustrating thing about making this kind of gamble has to be that most of it is out of your hands. Casino executives should be watching the players down at the WSOP for some tips on how to handle bad beats…or not to handle them. Because if the past two years have taught us anything, it’s that there’s a far bigger element of gambling to the casino-operating business than anyone’s been willing to admit for the past twenty years.

And yes, that is a Deep Space Nine reference in the title.

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Nevada revenue decline declining

July 9, 2009 11:50 am

Hey! What passes for good news on the casino revenue front: the decrease in revenue isn’t as bad as it’s been. Who would have thought we’d be saying that back in 2007? From the LV Sun:

Casinos along the Las Vegas Strip won $480.8 million in May, making it the 17th straight month of a fall in revenues.

The state Gaming Control Board said the win, before taxes and business expenses, dropped by 6.3 percent at the 41 casinos on the Strip compared to May 2008. But it ended a seven-month string of double-digit declines.

Positive signs were the wins in baccarat, up 38.5 percent, roulette increased 24.1 percent and the penny slot machines inched up 4.1 percent.

The board reported the win statewide dropped to $889 million, down 8.34 percent from the same month of a year ago. And that compares to May 2008, when gross win was down 15.2 percent.

And the past fiscal year the state has collected $655.4 million in taxes from the casinos, a decrease of 15 percent.

via Strip casinos see 6.3 percent drop in winnings – Las Vegas Sun.

Looking at the statewide numbers, table win actually improved by 1.1%, thanks to that robust growth in baccarat. Part of this was because of more play, but part was because the casinos got luckier. I’ll break that down in the Strip section below. Statewide, slot win was down almost 13 percent. That’s a major dropoff by any standard. The total number of slots in Nevada casinos has, since May 2007, fallen by about 5,000, to 170,316, which fits into my previous assertion that Nevada casinos have to do more with less. The unheralded shrinkage of Nevada’s casino industry continues. This has major budget implications. Even if we magically returned to 2007 levels of gambling, the state would be bringing in less in taxes since the casinos collectively have fewer machines. Aria opening later this year will reverse the decline, but if other casinos close, it won’t do much good.

I’m going to take some time to lay this trend out. These are statewide slot and table number from the Nevada Gaming Revenue Reports, May 2005-2009:

May 2005: Tables: 5,936 | Slots: 179,144
May 2006: Tables: 5,965 | Slots: 178,701
May 2007: Tables: 5,857 | Slots: 175,077
May 2008: Tables: 5,851 | Slots: 168,497
May 2009: Tables: 5,714 | Slots: 170,316

In the past five years, we’ve had a 3.7% decline in the number of table games and a 4.9% decline in the number of slots. So even if people were gambling as much as they did a few years ago, the state would still be earning less in gaming taxes because revenues would be proportionally lower. Those who argue that the state needs to re-examine its tax structure should consider that point: it seems to be logical to assume that, with a smaller industry, the state will have to ease its reliance on gaming revenue taxes.

Now…on to those Strip baccarat numbers. Here how they compare with last year’s:

May 2008 bacc win percentage: 11.29% | win: $69,723,000 | total play: $617,643,000
May 2009 bacc win percentage: 13.35% | win: $96,519,000 | total play: $722,988,000

Strip bacc gamblers were about 2% more unlucky this May than last. If the house had maintained its 11.29% win percentage, the total bacc win would have been about $81.6 million for the month. Any way you slice it, that’s a legitimate increase. If the trend holds, the outlook for City Center starts to look better: if high-end play is on the rise, there will be room for Aria to take some of that market. Just how much room there is, however, remains to be seen.

Slot play in general on the Strip was weak: there were declines in every denomination but pennies and Megabucks. With 21 more Megabucks machines on the Strip in May 2009 vs May 2008 (about a 13% increase), total win more than doubled.

The bump in penny slot revenues, though, is less impressive. The total number of penny slots on the Strip increased by about 21%. The total win, however, was up by only about 4%. Monthly revenue per machine in May 2008 was $6,193.51. In May 2009, it was $5,318.93. That’s a 13.3% decline in win per unit for the month–not good indicator of strengthening demand. On the other hand, quarter machine win per unit this May was only $3,278.87, so it looks like, all things being equal, a slot manager could boost his monthly numbers considerably by replacing some quarters with pennies.

I could keep on analyzing this for the next few hours, but I’ve got other things to do, so that’s all for now.

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Book Review: I’d Trade My Husband for a Housekeeper

July 7, 2009 10:32 am

Trisha Ashworth and Amy Nobile. I’d Trade My Husband for a Housekeeper: Loving Your Marriage after the Baby Carriage. San Francisco: Chronicle Books, 2009. 176 pages.

It’s another Amazon Vine review, and another advice book. If you wonder why I review so many of these, its because there seem to be a lot of them published.

Ashworth and Nobile have geared this book for the married mother who’s finding that, amid rushing out to play dates and managing the household, she’s lost the magic in her marriage. Their ideal researcher is probably a formerly-professional, stay-at-home mom who’s not struggling to make ends meet. It’s not just the authors’ own stories and opinions–they draw on “authorities” (mostly other authors, not all of whom have obvious academic or professional credentials) and have interviewed more than 200 married women with children (as well as a few men). This gives the book a broader feel than a simple personal reminiscence.

It’s not a particularly dense book, with super-sized quotes, short quizzes, and checklists of important points filling up much of the space. Essentially, it’s a guide to how to make a marriage succeed, and it feels like a combination of the management-success book with the matrimonial advice tome, with key takeaways highlighted and repeated for emphasis.

There isn’t much revolutionary in here. Basically, it comes down to: don’t have unrealistic expectations, be patient with each other, and listen to each other. Though it’s not new, that’s never bad advice, and reading about how other people have navigated the obstacles in their marriages–or haven’t–might give married couples some advice for overcoming adversity in theirs.

That being said, you might find some of the stories similar to your own situation, or not at all. There’s a tendency to pit the valiant overworked mom against the stereotypical SportsCenter watching, emotion-denying, dinner-demanding ogre-husband. Luckily, input from real husbands counter-acts some of this bias, but the assumption is, more often than not, that the husband is a big part of the problem. If you’re a guy, it’s an interesting look into how you might seem to your wife, but it’s not necessarily going to correspond to your situation.

Bottom line: it’s an interesting read, but doesn’t have any magical secret or anything revolutionary to say about marriage. If you’re having doubts about your marriage, you will probably benefit from the perspectives found within this book.

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Bernie Goldstein, 1929-2009

July 6, 2009 10:27 am

The casino industry has lost one of its major innovators with the passing of Bernie Goldstein this weekend. From the Quad City Times:

Bernard “Bernie” Goldstein, 80, who got his start in business as a scrap metal dealer and became a major player in Americas gambling empire, died Sunday in Trinity Pathway Hospice, Bettendorf.

“Im just a scrap dealer who did good,” Goldstein once said.

He was considered to be the father of riverboat gambling who wore a gruff exterior, but was a softie when away from the business table.

His stake in the gambling industry – and other businesses – is said to have created jobs for as many as 100,000 people.

Cancer, which was diagnosed last autumn, slowed Goldstein down, associates said, but only a month ago he was at a Bettendorf City Council meeting to receive a special honor and salute from the city.

He looked pale and wan at the meeting but graciously smiled and shook hands all around as he received the honor.

via Riverboat gambling mogul Bernie Goldstein dies.

Goldstein was behind the 1989 legislative drive to get casino gambling approved on riverboats in Iowa, the nation’s first riverboat casinos. He saw riverboat gambling as a way to attracts tourists and revive economically depressed areas of the state, particularly the Quad Cities region. On April 1, 1991, the first dice were tossed on his “Diamond Lady” boat, making it the first legal riverboat casino. In 1992, the company that owned the riverboat was renamed Casino American, and it opened the Isle of Capri in Biloxi, that state’s first riverboat (actually barge) casino. Over the next few years, Goldstein opened a spate of Isle of Capri casinos across the south (Vicksburg, Bossier City, and Lake Charles) and expanded into Colorado. As a result, the company was renamed Isle of Capri Casinos, Inc.

There are few owners who had as much an impact on the proliferation of gaming in the 1990s, and it’s amazing to think that for Goldstein this was a third career. And it’s possible to imagine that without Goldstein’s determination to champion riverboat gambling in the late 1980s, casino history might have turned out very differently.

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Book Review: Managed by the Markets

July 2, 2009 9:01 am

Gerald F. Davis. Managed by the Markets: How Finance Re-Shaped America. Oxford: Oxford University Press, 2009. 304.

We live in a world where finance has outstripped production, where it is more important to make money than to build cars or refrigerators. In Managed by the Markets, Gerald Davis tries to make sense of this transition. He raises some interesting points, but ultimately the book is short-sold by needless repetition. It would make an intriguing 30-page article, but there’s not nearly enough material here for a 300-page book.

Case in point: an 8-page preface introduces the arguments of the book: “finance had become the new American state religion,” and citizens had been transformed into investors, as “the expansive use of financial markets has shaped the transition from industrial to post-industrial society in the United States over the past three decades.” This is followed by a chapter-by-chapter outline of the book’s structure. Fair enough. But then, the 30-page first chapter does the same thing, in expanded form, including an even longer summary of the chapters to come.

The author has a tendency to, as Gorilla Monsoon might have put it, “go to the well once too often.” For example, on page five he describes the change to a financial-market based capitalism as a “Copernican revolution.” It’s a fine analogy for the world-shifting rise of markets as the arbiters of capital. But he then re-uses the metaphor three more times in the next 50 pages. It’s overkill. He also has a tendency to find amusing instances of finance run amok–David Bowie issuing $55 million in bonds against future royalties, or a Norwegian town investing in American mortgages–and use them repeatedly, suggesting that there’s not much depth to his research outside the small circle of factoids that are rotated in and out of the text. There is some really interesting material here, but it’s run into the ground over the course of the book.

The book’s highlights are Davis’s analyses of the rise and fall of corporate “social responsibility,” the profound impact of the shift from bank financing (loans) to market financing (stocks and bonds) on the world’s business, and the rise of the vendor state. Each of these developments has serious implications for public policy, and Davis advances thoughtful ideas, though they are rooted in the concept that bigger is better (there’s a great deal of nostalgia for the big corporations of the mid-20th century) and it is difficult to see how any amount of regulation or planning could put the genie of finance back into the bottle at this point.

In short, the ideas are of interest, but the presentation leaves something to be desired.

The book is interesting to me because it informs recent developments in the gaming industry. Massive over-leveraging and what now seems a foolish optimism in the real estate market aren’t unique to the Las Vegas Strip–these trends have shaped American (even global) business for the past decade. Is there anyway that this mess could have been avoided? With shareholders demanding value, and executives having few options to create value but mergers and expansion, probably not–companies that didn’t try to grow quickly were, for the most part, acquired by others or threatened with shareholder revolt. Nor is there much to suggest that the future will be any different, though as I’ve suggested before managers could learn a thing or two from the players at their tables: they need to understand that, no matter how hot the dice have been, it’s just as possible to seven out five times in a row, so it’s best to take some chips off the table during a lucky run. Letting it ride–whether on the pass line or on condo-hotels–can be rewarding, but it’s a risk that often ends badly.

Another interesting point was Davis’s discussion of OEMs, or “Original Equipment Manufacturers.” With the market demanding companies that have few assets and high profits, many manufacturers have outsourced the actual production of the goods that they sell, allowing a second party to own the factory and build the equipment to their specs before slapping their label on it. The original manufacturer, then, is primarily concerned with advertising and brand management, not the headaches of production. This sounds a great deal like what MGM Mirage is doing with its brand name overseas. You can see that the company is positioning itself not as a hotel builder, but as a hotel brander–which is smart, given the vicissitudes of the real estate market and construction. Seeing what the company is doing against the context of what other companies are doing, you can see the logic in the process, though it remains to be seen whether a company that has no physical control over the products bearing its name will, in the long run, have a recognizable brand.

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