{"id":25698,"date":"2019-12-26T07:44:34","date_gmt":"2019-12-26T15:44:34","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=25698"},"modified":"2019-12-26T07:44:34","modified_gmt":"2019-12-26T15:44:34","slug":"chinas-credit-bubble-ocean-resorts-secret-formula","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/chinas-credit-bubble-ocean-resorts-secret-formula\/","title":{"rendered":"China’s credit bubble; Ocean Resort’s secret formula"},"content":{"rendered":"

China<\/strong> gamblers may be playing today at the expense of tomorrow. Bloomberg<\/em> reports that Generation Z is borrowing heavily<\/a> in high-interest debt to fuel its consumerism, a phenomenon that should be of concern in \"\"Macao<\/strong>. “Household debt hit levels of 57% of gross domestic product in the third quarter …\u00a0more than double just 27% in 2010.” Household debt represents just under 100% of disposable income<\/a>. Of Generation Z it is said, “They\u00a0have\u00a0little income and therefore virtually no credit history.\u00a0It\u00a0doesn\u2019t matter, because they have had access to a whole range\u00a0of online banks, fintech startups and peer-to-peer lenders, some of which charge exorbitantly high interest rates.” If they’re spending that moolah in Macao it means there’s going to be a trough when those bills come due.<\/p>\n

Most of this household debt is collateralized, but that’s no solace to casinos when the coming generation has no money left to spend. Mind you, household debt to GDP ratios are off the charts in gaming-mad Australia<\/strong> (126%). In these United States<\/strong> it’s a mere 75%. As of a year \"\"ago, outstanding credit card debt in China stood at $1 trillion. By the way, personal bankruptcy does not exist as an option in China, meaning that when the well runs dry everything you own is fair game for debtors. At least Macao can take comfort from a slew of economic-diversification initiatives<\/a> announced by President Xi Jinping<\/strong>, including the establishment of a Macanese stock exchange.\u00a0\u201cThe future focus will be on tourism and finance, to make it a center to host international meetings, like Singapore<\/strong>,\u201d said one source. With the Macanese government reliant on casinos for 80% of its revenue, we’re sympathetic with what President Xi (pictured<\/em>) is saying.\u00a0\u201cThis is the candy that Hong Kong<\/strong> did not want,\u201d remarked political commentator Larry So<\/strong>.\u00a0It is a gift for Macao, for Macao being a good boy.\u201d<\/p>\n

Adds Global Gaming Business<\/em>, “The post-handover casino boom has brought full employment at high salaries relative to other unskilled jobs, and the government does its part by restricting croupier positions to Macau residents. Employment security with the casinos is virtually \"\"ironclad, layoffs are unheard of, and the concessions make sure to regularly dole out lucrative bonuses equivalent to a month\u2019s salary or more.” There could be more where that came from if the government wills it.\u00a0Global Betting &\u00a0Gaming Consultants<\/strong> analyst Warwick Bartlett<\/strong> remarked, “The growth of Macao relies on the political whim of Beijing<\/strong>. With 1 billion Chinese citizens as a market it is quite possible for Macao to produce double-digit growth if Beijing wishes to allow it.\u201d At the moment it doesn’t.<\/p>\n

* Raving Consulting<\/strong> had a longtime formula for casino success. “Find out what your customers want. Give it to them.” Sounds simple but relatively few casinos follow that advice. Ocean Casino Resort<\/strong> does, hence its newfound success<\/a>. \u201cThe property had a history of being tone \"\"deaf to most Atlantic City<\/strong> customers, and we\u2019ve now overcome that,\u201d CEO Terry Glebocki<\/strong> confessed to Global Gaming Business<\/em>.\u00a0\u201cWe put our casino guests first in absolutely everything we do, from offers to comp rooms to entertainment.\u00a0 We knew it was important to listen to our guests\u2019 ideas and concerns, and I\u2019m proud to say we\u2019ve tailored the improvements made thus far to be responsive to what our guests expressed.\u201d Yes, growing success along the Boardwalk is being fueled in large part by sports betting and Internet gambling, but money is (more) money. As gaming pundit Rummy Pandit puts it,\u00a0\u201cThat New Jersey<\/strong> is taking the lead with respect to new gaming products such as online gaming and sports betting can only be a positive. We should expect to see New Jersey\u2019s gaming properties continue to innovate and diversify their gaming product to remain competitive with neighboring casino markets such as New York<\/strong> and Pennsylvania<\/strong>.\u201d<\/p>\n

Jottings<\/strong><\/em>: Employees at Red Rock Resort<\/strong> must be happy campers. They just voted against joining the Culinary Union<\/strong>. More details as we have them … Eldorado Resorts<\/strong> just got Louisiana<\/strong> regulatory approval to move the Isle Grand Palais<\/strong>\u00a0riverboat casino to terra firma<\/em><\/a> near Lake Charles<\/strong>. May it be the first of many (Boyd Gaming<\/strong>‘s Treasure Chest<\/strong> in Kenner<\/strong> may be next) … DraftKings<\/strong> is set to launch \"\"mobile sports betting in New Hampshire<\/strong> on the 30th, in plenty of time for the Super Bowl<\/strong> … The extension of Matt Maddox<\/strong>‘s contract as CEO of Wynn Resorts<\/strong> came with a substantial “but”: His pay packet will remain the same<\/a>. The company was sufficiently “george” to pick up the $500,000 fine that Massachusetts<\/strong> levied on Maddox for his complaisance during the Steve Wynn<\/strong> sex scandal\u00a0… Oklahoma<\/strong> Gov. Kevin Stitt<\/strong> (R) offered the state’s casino-owning tribes a compact extension until August 31, 2020, but 32 of 35 tribes have said “no thanks” … This week’s Global Gaming Business<\/em> podcast<\/a> features MGM Resorts International<\/strong>‘s interactive prexy\u2014and S&G<\/em> cult figure Scott Butera<\/strong>. It’s your chance to hear 25 minutes of “Woody” unfiltered.<\/p>\n","protected":false},"excerpt":{"rendered":"

China gamblers may be playing today at the expense of tomorrow. Bloomberg reports that Generation Z is borrowing heavily in high-interest debt to fuel its consumerism, a phenomenon that should be of concern in Macao. “Household debt hit levels of … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[23,60,275,151,277,14,199,37,84,62,112,245,163,257,115,25,276,232,243,57,32,20,233],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/25698"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=25698"}],"version-history":[{"count":1,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/25698\/revisions"}],"predecessor-version":[{"id":25701,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/25698\/revisions\/25701"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=25698"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=25698"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=25698"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}