Despite much chumming of the waters by Union Gaming Securities Asia‘s Grant Govertson, it’s the same old same-old in Japan, where casino legalization has been delayed yet again and probably should 
be under a news blackout until substantial progress is achieved. Ineffectual Prime Minister Shinzo Abe doesn’t even have the support of all of his narrow governing coalition, so the issue is as good as dead until there is a major political shakeup. Govertson tries to suggest an increase in Chinese tourists by 83% last year and 117% this year will put wind in the casino bill’s sails. One could just as easily argue that Japan’s already getting the tourism so why does it need the casinos? Besides, Abe has blown any chance of getting them open in time for the 2020 Olympics, so the whole business has taken on the character of a farce.
* Bankruptcy notwithstanding, Caesars Entertainment continues to update some of its older properties. Latest in line for a beauty treatment is Harrah’s Gulf Coast. (Even the name is new.) Latest in a series of renovations is a $14 million hotel makeover. Judging by the sample photos, Marnell Cos. is doing a spiffy job. The finishing touch will be “Paintings and photographs of the nearby Biloxi Bay Bridge, Biloxi Lighthouse and local scenery [that] will add touches of South Mississippi.” The configuration of the hotel will be rejiggered so that it reopens with five additional rooms to meet demand. Harrah’s executives cited a bumper crop of updated resort product on the Gulf Coast as the spur to their renovation. (Even the plumbing will be new.) Caesars’ creditors may not be happen to see money going toward capex maintenance, but a more-competitive Caesars should redound to their benefit over the long haul. Best of all, Harrah’s Gulf Coast will still be pet-friendly.
There’s at least a glimmer of daylight between Sen. Marco Rubio (R) and patron Sheldon Adelson on Internet gambling. Rubio hints that he might favor a carve-out for poker as a game of skill. Whether this difference of opinion costs him Adelson’s support remains to be seen. The anti-Internet gambling bill that Sen. Lindsey Graham (R) has introduced and which Rubio co-sponsors takes no prisoners and, in an especially problematic Tenth Amendment overreach, would retroactively ban ‘Net betting in New Jersey, Nevada and Delaware — something like this.
I doubt it earned him any votes in the Silver State but give Jeb Bush points for reckless candor in telling pundit Jon Ralston, “Yeah, I don’t like gambling, just for the record. Is that politically incorrect in Nevada?” Yes. Very incorrect, sir. But brave, I’ll give him that.
* Possibly emboldened by Steve Wynn‘s rhetoric, Lawrence Ho is letting his feelings on the emaciated Macao gambling market be known. “What has been going on with the Chinese economy, 
especially the anti-graft campaign, has made the VIP environment more challenging in the near term, as fear has been driven into the hearts of many of the middle-to-upper class,”he told Fairfax Media on the eve of the opening of Studio City Macau. However, he was careful to hedge that criticism with, “However, the gaming market, especially the mass-market segment, still has much potential for development.”
Ho also made sure to echo Chinese President Xi Jinping‘s call for Macanese economic diversification. He cited the manifold attractions of Studio City, including its Ferris wheel and Batman ride as evidence of Melco Crown Entertainment doing its part. While preparing for the arrival of films stars including Brad Pitt and Leonardo DiCaprio, Ho sang the party line, saying, “Diversification and innovation are paramount to overcoming the challenges and ensuring sustainable success in the city.” Not that Studio City will lack for gaming, with 1,233 slots supplementing its 200 table games.
Ho’s relative brashness re Peking might have something to do with the pressure he’s feeling from his underwriters. He’s asking for a year-long forbearance (or “covenant holiday”) on a $1.4 billion loan, 
plus an increase in the company’s leverage ratio. The table games limit is nothing new, as things go in Macao, so Ho and Wynn look slightly naive for behaving as though it came as a surprise. (Ho looks particularly bad for having assumed a maximum allotment of table games as a condition for the loan.) One wonders why a less-than-optimum table game allotment didn’t go into their financial models, which seem to have been primed on best-case scenarios.
In Ho’s case, if the banks don’t play along, he has to pony up $1.8 billion right away, raising the question of whether he and James Packer could lay their hands on that much cash on the spot. This bulletin certainly casts a pall over Tuesday’s opening-night festivities.
