In the year since the first protest in Syria took place (January 26th according to our universal source of truth, Wikipedia), much has happened, but little has changed.  Assad is still in power and the army and police still maintain order in the traditional way of dictatorship  – arresting or shooting dissidents.  Assad regularly takes to the airwaves and declares his intent to remain in office, regardless of who inside or outside of Syria calls for his resignation.  Except for Russia and Iran, Assad and his government have little support in the international community, and a great deal of opposition.  Europe, many Asian and the majority of Arab states are opposed to Assad’s violent methods and his continuance in office.  The Arab League has taken an almost unprecedented stance, calling for the removal of a sitting Arab government.  The Arab League has sent a delegation to Syria to observe and report on the causes and effects of the violence.  The presence of the League’s observers only seems to have spurred the government to increased violence.  Every day dozens, if not hundreds, of people a reported killed by the government forces.

Although, the League is calling for the Assad’s resignation, it has no mechanism for forcing the issue.  So after weeks of renewed calls for Assad to step down and threats of boycott and diplomatic isolation, the Arab League has taken taken the case to the United Nations.  The UN will be debating a resolution on Syria next week; traditionally United Nation resolutions have little immediate or direct impact.  But at least they make clear where every country stands on a given issue; and occasionally they lead to economic sanctions that may or may have an impact.  I listened to an interview on Arab television earlier in the week, the interviewer asked the “Arab expert” what he thought of the actions taken so far by the Arab League.  He answered, “If you think the United Nations is a powerless joke, you haven’t seen anything – the Arab League is much worse as a joke and has much less power.”  That statement seemed to match everything I have read or seen about the league – it seems pretty accurate to me. The Arab League and the United Nations may be jokes and powerless, but they are the best we have at the moment.

For the world at large,  the United Nations is the only mechanism we have, it may be flawed, but the world without a United Nations is more flawed in my opinion.  Back to the Arab League, today I listened to another interview on Arab television, this time with a Tunisian.   He talked about creating an Arab world ruled by democratic governments, countries where the citizens had both economic and political freedom.  He said he hoped that Tunisia could be the foundation of an Arab Union, a stage past the Arab League – a union modeled after the European Union.  Wow! Suppose there was both a European and an Arab Union – it would make as much as 40 percent of the world one (two, but they might act in congress mightn’t they?) country without borders; groups of nation states cooperating for economic prosperity, but insisting on peaceful coexistence and democracy.  Probably that is just another pipe dream – you know the kind of dream you have while smoking one of those pipes? But in a world filled with violence,  we all need a little pipe dream of peace once in a while – don’t we?

The national trend to eliminate cigarette smoking from public places has slowed down dramatically since the recession began.  Part of the reason is the economy; lawmakers have been unwilling to pass any laws that might have a negative impact on  business, and at least initially prohibiting smoking does impact some kinds of businesses.  The progress has also slowed down because it has been so effectively that there are very few easy targets left, states with exceptions for casinos is one of the targets that remains.  Smoking legislation has been a major issue for casinos in every state it has surfaced; two states, Missouri and Indiana have current legislation that would expand the prohibited areas and might include casino floors.  Historically however, casinos have been successful in many jurisdictions in maintaining casinos, or parts of the casino floor, as exempt areas.

Recently there have been two non-smoking stories that do not fit the previous trend, but may represent future trends.  First, in Atlantic City, it is rumored that Revel, the $2 billion mega-casino scheduled to open in May,  may open as a non-smoking casino.  That would be huge, the casinos in Atlantic City fought the original legislation that outlawed smoking in casinos; they complained their revenues went down 20 percent immediately.  The argument carried the day and the casinos managed to get a reprieve and are now allowed to have smoking in part of the casino.  So, if the newest and most expensive casino opened without smoking, it might make it hip and modern to eliminate smoking.  Given the amount of competition the city is facing – currently all of the major competition allows smoking in the casinos – it would be shocking to see AC try the non-smoking niche.  But it could happen if Revel is successful without smoking.

The second story comes from Ohio, the casinos going into Toledo and Columbus are going to screen employees for smoking.  Smokers will not be hired – the rationale is also financial; smokers cost more than non-smokers.  They miss more work and have more health issues and their issues are likely to be more expensive than non-smokers.  Again, if the casinos in Ohio are successful with policy it is one that could easily be copied by casinos in other jurisdictions.

The issue is very personal to me my ex-wife, father, step-father, aunt and two uncles died from smoking related diseases.  Death from smoking is slow and painful, painful for the person dying and very painful for the people watching.  Additionally, I have an interest in a small casino in Colorado – a state that no longer permits smoking in its casinos.  When the law first past, it was not clear if it would destroy our business or not, but over time we overcame the decline caused by the non-smoking regulations.   At the time, my partner (both he and I are ex-smokers) said, “If we survive this, then in the future we will be glad that our casino is non-smoking.”  Niether of us think smoking is wise for anyone, but when your livelihood is threatened it is difficult to take the moral high ground.  However, we did survive and we are glad.  So now it is easier for me to take the high ground (you know I am not taking any person risk with my position).  But I think it is probably time to close the door on smoking in public; in the long run it is better for the customers, it is better for the employees and if you extend the ban to employees it will be better for the bottom line of the business too.

Net Worth $21.5 B As of September 2011 – Forbes

 All casino jurisdictions have regulations that are meant to keep the casino games honest, protect the players and to insure the state collects all of the money it is due.  All key executives and casino companies undergo background investigations to make certain organized crime – the Mafia – and individual criminals are kept out.  Many casino jurisdictions have also limited casino executives from participating in politics.  Some jurisdictions don’t allow casino executives to run for public office and others prohibit casino executives or companies making political campaign contributions.  The lawmakers were trying to keep the criminals from corrupting the gamblers and gamblers from corrupting the politicians.  The idea of limited political participation has always been offensive to me.  After all, are not the owners and executives of casinos private citizens, as well as corporate citizens and should they not have same political freedoms as any other citizen?

It all seemed pretty straight forward to me until Sheldon Adelson decided he wanted to help Newt Gingrich become the next president of the United States.  In just over a month, Adelson, and now his wife, has given $10 million dollars to Newt’s super-PAC.  Some commentators are already giving Adelson credit for Gingrich’s South Carolina victory.  Just how important does that make Adelson to Gingrich?

How much more money might Adelson be willing to give to guarantee himself a seat next to the president whenever he wants to chat about issues dear to him, for example, casino gambling and the state of Israel?   Forbes ranks Adelson number 8 on its list of richest people in the world, with an estimated $21 billion of net worth.  Adelson only makes $3 million a year in salary, but he appears to have more than that to give away to get his way.

And if Adelson can buy a president, just who else with the financial resources might decide to own a president as well?  Suddenly the restrictions on political contributions from casino operators does not seem quite so undemocratic to me; in fact, given Adelson’s current impact on the GOP presidential process I would be willing to add to the list lots of other very rich people. But then, under the current laws aren’t corporations considered individuals?  In that case, should we not consider……….? But wait, didn’t we already pass laws limiting political contributions?  Adelson has just illustrated for those of us that missed it, the those laws are not working.

 Dr. Miriam Adelson, the wife of Las Vegas casino mogul Sheldon Adelson, will match her husband’s $5 million contribution to a political action committee supporting Republican Newt Gingrich’s presidential bid…Sheldon Adelson’s $5 million contribution to the Winning Our Future super PAC is credited with helping propel Gingrich to victory in South Carolina on Saturday…The contribution from Miriam Adelson comes as the super PAC is preparing to air campaign ads in Florida, a state where Mitt Romney, Gingrich’s chief rival, has already been spending heavily. Anjeanette Damon, Hispanic Business, 1-24-12

Lokomotive Leipzig fans before their team’s encounter with Dynamo Schwerin in the FDGB-Pokal in 1990. Wikipedia

Watching professional football, baseball or basketball can be entertaining and exciting; it can also be boring, inane and filled with way too much advertising.  However, it just watching a game – grown men playing a game – it is not any more important than that.  Your team may lose or it may win – but it was just a game.  Yesterday four professional football teams competed to see which two teams of the four will play in the league’s championship game – the Super Bowl.  Two teams won, two teams lost – the winner won the game – meaning they scored more points than the losing team.  The loser lost the game – they scored less points than the winning team.  Points – just a way of determining which team wins the contest – the game; it is not life or death.

The game (any game) is not more important than choosing the next president or the violence in the Middle East; it is not more important than the economy or the debt crisis in Europe; it is not more important the nuclear weapons in Iran or repressive governments in the former Burma.  In fact, the results of that game, or any other game, is not more important than anything – it is just a game.  And yet some people threatened losing players with death, wished death on their families and hoped a player might die in his sleep.  What kind of a value system produces people who think like that?  Hooligans they are called in Europe when they disrupt soccer matches, bad boys they are called when the disrupt the other children’s games on the player ground – either way they are the same thing – childish misbehavers.

Look at the picture above, can you identify the teams, the cities or the tournament or even the sport?  No? That is just how important those games yesterday were – in the rest of the world or in a hundred years it is all non-nonsensical, meaningless, foolish games played for no purpose.  Those games only serve to divert us from our daily drudgery; that is it – entertainment.  If you want to be passionate about something, there are lots of ways in the world to put your passion to work on something worthwhile, something meaningful – football will never be on that list.

In my arguments yesterday, I left out a couple, probably more, but two will do for the moment, of potential events that could create the outcome I was seeking – economic growth in Reno.  One is already taking place and the second is too scary to even look at too closely.  First the scary one.

Today, I watched an hour special on Al-Jazeerah commemorating the anniversary of the beginning of the overthrow of the Mubarak regime.  To the Egyptians, unlike the rest of us, the beginning of the dramatic change was not in Tahrir Square and all of those relatively well-behaved demonstrators.  To them it began in  Suez, quietly at first, but ended in violence, death and burning buildings.  The citizens of Suez started with mild protests about election procedures but police tactics escalated the protestors into revolutionaries.  Suez has a model that no other Egyptian city has, in 1973 Suez resisted the Israeli occupation, attacked the Israeli forces and burned down the police station that was their headquarters.  The demonstrators a year ago in Suez were well aware of that precedent and cited it frequently in their rhetoric.  They went much further this time and burned down many more buildings than the headquarters of police (the same building they burned in 1973).  So that is the first of the two events I left out of my argument, revolution and civil war – in the aftermath of those events, too, there is much to repair and rebuild. It is not a model we would like to follow, is it?

The second event, while it does not generate immediate economic growth, does address unemployment rates – population egress – people moving away.  For the better part of 50 years Nevada led the nation in population growth, most of that growth was in Las Vegas, but Reno too attracted people looking for less expensive homes for their retirement or jobs in construction or gaming.  While, our housing prices are still less than California, it is not as easy to cash out in California and move to Nevada as it was in those go-go days of yore.  And of course the jobs possibilities are long gone – except possibly in light manufacturing and warehousing the only two segments of our economy showing any signs of growth.  But in general, we have lost people, most of those that came here for construction, gaming, lawn care, gardening or entry level retail have been forced to move on.  Reno at moment is much like Detroit, the major industries that drove our economic growth for a very long time are shrinking dramatically, the revenues and the employment are both effected.  Casino revenues and casino employment for example are lower than anytime in the last 25 years; construction cannot be too far behind.

However, the bad news in this case becomes the good news.  When enough people have gone our unemployment rate will drop.  We won’t have gained any new jobs, but a much higher percentage of our population will be employed.  That fact alone will make for a healthier economy.

Stockton Street from Union Square, looking toward Market Street, Wikipedia

Choosing the right metaphor can be really important; the metaphor can, and often does, become the model and thereby reverses the process.  Instead of using the metaphor to help us visualize or describe something, we look to the metaphor to help us plan.  That may work, that is as long as the metaphor is applicable and remains so when you extend its use; just a word of caution, that rarely is true.  Today I was talking to a friend who owns a real estate franchise locally; he was talking about the challenges of the real estate business in Reno four years into the recession.  He has to hustle, look for opportunity in places he would have ignored in good times – now he needs to explore every possibility.

My friend told me about the beginning of his company over a hundred years ago; the two founding partners got their start in real estate in the aftermath of the San Francisco earthquake of 1906.  My friend is trying to take a page from his company’s history and follow some of the methods for developing business those two men used in the rubble of San Francisco.  It occurs to me that the aftermath of an earthquake might be a good metaphor for our times.  Weren’t we hit by a financial earthquake that destroyed a huge part of the financial, business and government structure?  Didn’t we loose hundreds of businesses and even industries in the quake?  I loved the metaphor and I was ready to run with it – but there is a major problem.  The earthquake in San Fransisco created an unprecedented building boom – all that was lost needed to be replaced and replaced as quickly as the resources could be found.  The good citizens and the city in 1906 needed workers, materials, financing, government regulations, government services, transportation infrastructure, land and the title to that land.  Out of that rubble jumped almost overnight a dynamic economy.

We, at least in my little corner of the world, sit in a pile of rubble, but there is no need or sense of urgency to replace any of the things that were lost.  Real estate, government and construction are in shambles, but there is no will, nor any need to recreate the world of 2007.  Nationally home sales were up in 2011, that is up from 2010 – they are still 30 percent below 2007 and Nevada is worse than any other state; and the largest percentage of sales are not to first time buyers (in the good years they accounted for 40 percent of total sales), but distressed sales- short sales, bankruptcies and foreclosures.  In our region, according to my friend the real estate guy, office vacancies run as high as 50 percent in some areas.  And we all have seen all of the empty retail space that litters our community.   There clearly is no need to build new houses, office buildings or retail space – retail vacancies in this region are as high as office vacancies.

So what about employment, after all people with jobs and money to spend are the engines of our economy? You can image how much consumer spending was generated by the thousands and thousands of workers rebuilding San Francisco. They needed housing, transportation, food, clothes, entertainment, recreation and, of course, something to drink.    In Reno we have regained just 1.6 percent of the jobs we lost; and our region lost nearly 20 percent of the total number of jobs that existed in 2007.  So we can’t look for newly hired people with money, we can’t look to real estate or construction.  How about government? It was hit probably worse than any other segment of our community.  Government in Nevada is still shrinking, each new budget cycle is still forcing more cut backs.  By law we have to balance our budgets, which means we can only spend what we take in taxes.  Taxes are down, government is down.  Not a pretty picture – but here we might go back to the metaphor and ask if it can help us?

In the aftermath of a major earthquake, or fire, we have more experience in Reno with major destructive fires than we have with earthquakes, any way in the aftermath of the destruction there is the need and the will to rebuild.  What might we do?  It is hardly practical or even legal to burn down a bunch of houses, empty office buildings or useless retail malls – but could we shake the earth and knock them down?  There are thousands of problems legal, financial and practical to such an idea.  But if we could suddenly be granted a wish or two; what if we could tear down hundreds of outdated, empty and under-performing  buildings and houses?  Just enough to create a need for new ones, just enough to create a bunch of jobs and investments, just enough to put some more money in the economy buying stuff.  Okay, it is foolish, but we are going to have to explore some new ideas, concepts and methods – this situation is not going to heal itself any time soon.  Like my real estate friend, we are going to have work harder and try some new things.

Since I first watch the movie Desert Flower, I have been trapped in one simple line from the film.  The film is the story of Waris Dirie, a Somalian model who was circumcised as a child.  As a teenager, Waris fleed Somalia and ended up in London.  Eventually, Waris became famous as a spokesperson, a model and as an author; she was and is an advocate for ending female circumcision; besides being beautiful and talented, she is very thoughtful and self-aware.  In one scene in the movie her friend and roommate gives her the telephone number of a young man who had caught Waris’ eye in a night club.  The friend suggested that she call him and Waris replied “and then what?”

That simple question contained all of pain and agony of her life, but it also showed Waris as a person aware that something always follows every act, consequence if you would.  That awareness is not common in our race and certainly has not been a regular part of my life.  However, for a while I intent to us the phrase to help me think through issues, both personal and public.

It is a fascinating exercise and one I would recommend to anyone.  In the exercise, the question is asked over and over again as one gets deeper into the subject and the possible ramifications of the action that lead to the initial asking of the “and then what?” It is a particularly interesting exercise to apply to public issues.

Today, I am not going into any depth with one subject, I only wanted to introduce the concept and give a brief example.  Lets say for discussion purposes we, you and I, are sitting in a board room with the board of directors and management of Genting International at some hideaway in Malaysia.  The chairman says, “I have an idea – lets buy some land in Miami Beach – it would be a great place to build a resort.”  As a responsible board member, you then ask innocently – “and then what?” Well, he says then we suggest to the city we will build a $4 billion resort, with a casino, of course. – “and then what?”  Well we put together some great drawings and plans and do a presentation that knocks them off their feet – “and then what?”  They are over joyed and give us the keys to the city – “what if they don’t – then what?”  Well, he is starting to get a little annoyed, but what the hell.  ” Well, then, we convince them with a media campaign, you know television ads and of course lots of campaign donations.  “don’t they have to pass a law first – what then?” They will, of course, they want our money – “but if they don’t, then what?’

But you get the point, we should work our way through lobbying and lawmaking, identifying the opposition and confronting it, identifying the competition, because by then we will have realized as soon as we make the first public statement about our intent there will be others who want to steal our idea.  Subsequent to the legislation there will be regulations, taxation, biding, financing and a hundred other issues to confront.  If we do our job right, before we ever leave our cozy little retreat, we have developed a plan that will see us through the months and even years this battle will take – hopefully without too many big suprises.

Did Genting do that?  I don’t think so, I think it bought the land and floated the proposal with no thought to anything but putting money in the bank.  Genting is not alone, I think most people and corporations approach life just as Genting did, on a wing and a prayer, but no real thinking.  They should all hire Waris to help them. I haven’t sent her a check, but she has earned one from me.

There is a biblical saying – “there is nothing new under the sun.”  It may be accurate, but not complete; there are many, many variations on a theme and not all of them have seen the light of the sun before.  This week a lawmaker in Nebraska suggested new casino legislation for his state, but with a novel twist.  He would like to promise no casinos within 50 miles of the state’s borders providing that bordering states share their casino revenue with Nebraska.  He singled out Iowa, claiming that Council Bluff casinos live off Nebraska gamblers – that in his mind entitles Nebraska to a share of Iowa gaming taxes.  Now, it is not likely the legislation will get off the ground, nor if it did that Iowa or any other state would share anything with Nebraska.  The lawmaker says it is not about expanding gambling in Nebraska, it is about expanding revenues in Nebraska.  It sounds crazy, but the idea may have legs – the cry of “keep the gambling dollars at home” dominates casino debates these days in most states.  The governor of New York used that very argument yesterday in stumping for his casino plan in New York.  Political blackmail – a wonderful idea, it would save all of the hassle, lawsuits and emotional debate that always follows passing the first casino legislation. With a good revenue sharing plan you leave the other state to deal with the hassles and you just figure out how to spend your share of the money.  How much would Atlantic City be willing to pay to get rid of casinos in Pennsylvania?  Okay maybe they don’t have that much, casinos in Pennsylvania had $3 billion in gaming revenue in 2011.

With another twist on an old idea, the director of the Iowa lottery is suggesting the state could form a network with other states and some foreign countries to put poker online.  That idea very likely to find supporters in the states that already have passed some kind of online gaming legislation.  This is it, no federal permission necessary, no federal taxation, no federal regulation – each state can choose to join the network and still maintain its own rules.  It is also probable the idea will lead more states to pass online gaming legislation.

The cat is out of the bag, Pandora’s box has been opened and those proverbial horses have escaped the barn through that door you – oh members of Congress and the Department of Justice – forgot to shut.  IGT is said to be under pressure from three of the largest casino companies over its $500 million purchase of an online gaming company.  The casinos don’t want their suppliers competing against them – a charge they have leveled before when IGT and Ballys actually owned casinos.

But in this new Wild West of the Internet it will be every man for himself and IGT wants to be there to provide the games, the hosting site and collect the revenues directly and not have to share with those casino companies; the company and Iowa may have already  started to talk about the mechanism – but if they haven’t they will soon.  Slot machines are not new, however some very new variations are on their way to your home computers soon. Slot game development has been held back for decades by state gaming regulators, with them out of the way, gambling games can become as exciting and creative as the other video games in the world. The possibilites are endless.  Oh, those casinos who want to control it all, they won’t be able to do it.  Cat is out, box is open and there is no putting the horse back in the barn.

Race at Churchill Downs

Predicting future events has become a kind of science; pollsters, for example, attempt to predict the outcome of elections, the likelihood that a model of car or television program will succeed and a thousand other likely or unlikely outcomes.  The general method is to ask a small sampling of given population questions about intents and preferences – then using long established mathematics to compute the likelihood of any given outcome, plus or minus some percentage number.

The methodology is also at the heart of market studies (or market analysis or market research), although market analysis requires the use of historical data as well the polling data.  So, if you were planning to build and open a new restaurant with a novel menu in a certain location you would want to do a few things first.  You might start by testings the menu by conducting polls to find out if people are interested in your concept and would patronize your restaurant; you might want to go further and conduct focus groups to see how real people actually felt about your food. Then you would want traffic studies to find out about the traffic near your restaurant, how many people drive past that site daily, what is the traffic count during key business times, lunch and dinner?  Next you would use census data to determine the number of people who live within say 5, 10 or 15 miles of your site. You want to know how much money they make, how much disposable income they have, how many times a week, month or year do they eat out?  How much do they spend on average when they go out to eat? Is your menu priced right for those habits?  It can be a very demanding discipline, McDonald’s is said to pay $50,00 -$100,000 on reserach to find the right location for each of its outlets – Wendy pays nothing for research, but pays $50,000 – $100,000 more for their sites located near the McDonald’s.  Getting all of the elements right is important in opening any new business.

Increasingly, state legislatures are prone to commissioning just such studies when they are thinking about expanding gaming in their state.  The end report should have all of the data that would appear in your restaurant report; how many customers can they expect, how much are those customers likely to spend and how much money will accrue to the state in the process?  It used to work pretty well, but it is highly unlikely to be accurate in 2012, nor was it in 2007 it seems.  Maryland commissioned just such a study in 2006 or 2007 in anticipation of legislation allowing for 5 casinos in the state – the report came back with numbers to warm a lawmakers heart – $1 billion a year in gaming revenue each year, the state’s share in the hundreds of millions of dollars – how can a state go wrong with that?  Well, easy, only two casinos have opened in 5 years, another is slated to open this year, but in the meantime, the surrounding states have increased their gaming and the economy took a dump.  Casino revenue in 2011 was about $100 million, not quite a billion; nor is it likely to ever even reach half of the billion dollars the study so glibly predicted way back before the recession.

This week, Kentucky released the details of a report it commissioned – and wow, the expect gaming revenues in Kentucky will approach $2 billion a year.  Or not.  First, no one is counting on the displacement, how much money that is currently spent on the ponies or lottery will move to casinos?  Second just what other gaming outside of Kentucky will have materialized before the first casino can open in Kentucky?  What legal and economic hurdles will the prospective casino developers have to overcome to get to the starting gate? And finally, just when will the fine citizens of the great state of Kentucky with its blue-blooded gentlemen, horses and grass be able to sit at home and place their bets on a computer?  I don’t question the science, math or skills of the people who did the research for the state of Kentucky – I question the world of gaming’s stability.

The current situation in gaming is too dynamic, too fluid to make long-term predictions.  Casinos in Kentucky might succeed, but the longer the state delays the less likely it is that Kentucky casinos will meet today’s expectations.  No state can guarantee what will happen in other states and worse, now no one can tell what is going to happen with the Internet. More than one state lottery director believes he/she has the authority currently, without the permission or approval of the governor or legislature, to sell tickets online – and some believe that includes video lottery terminals – slot machines.  Good luck Kentucky!  If you go into this like you bet on the ponies you will be fine – pick a pony you like, plunk down your bet and then go to rail to watch and cheer; no one who plays the ponies expects to win every race.  But wasn’t it exciting?

A tsunami may be on its way to shores of casinoland and coming from a direction that no one is watching – lotteries.  After all lotteries are dumb, slow games with wimpy little prizes right? Well, maybe not.  Between Powerball and Mega Millions 44 jurisdictions, 43 states and District of Columbia, offer a mega jackpot that continues to increase until the “big one” hits.  Those jackpots have gotten progressively larger as more states joined the networks. The largest jackpot to date was $390 million.  The jackpots now start at $40 million.

Starting in January of 2012, Powerball has doubled its ticket price; that could result in jackpots that are twice what they have been traditionally.  Powerball and Mega Millions are privately run national lotteries, between them they have nearly every state with a lottery linked together to create huge jackpots and that means 80 percent of population of the country can buy a ticket if they wish.  It is really simple, the more tickets that are sold the bigger the jackpot becomes and the bigger the jackpots becomes the more tickets are sold.

Those mega-jackpots do, what big jackpots have always done, draw more customers. Once a jackpot gets over $200 million, it begins to change people’s behavior.  Suddenly, everyone wants a piece of the action and a chance at instant wealth.  Non-players play, occasional players increase their play, groups of employees buy tickets together, people from states without Powerball travel to buy a ticket and casino players take their casino money to the lottery. Not many people miss the opportunity to get in on the excitement.  And the media helps feed the excitement, in many locales running daily stories on the jackpots.  It gets intense and even the police get involved – they have to work extra hours to cope with the traffic jams.

With jackpots twice as larger, nearly every month will have jackpots in excess of $200 or $300 million.  Those jackpots may have an impact on casino revenues – traditionally lotteries are not competition for casinos; the action is too slow, the odds are too unfavorable and the rewards are inadequate.  However jackpots approaching a billion dollars will go a long ways to changing people attitudes.

…”Certainly by summer, we’re going to see a record jackpot, I would think. By June or July,” said mathematician Dennis DeTurck, dean of the College of Arts and Sciences at the University of Pennsylvania. All because of a $1 price increase, effective Sunday…”It is conceivable that the jackpot would exceed half a billion dollars, and even approach a billion dollars,” DeTurck said. The current U.S. record was set in 2007 by Mega Millions, when a $390 million jackpot. Peter Mucha, Philadelphia Inquirer, 1-14-12

There is another major change on the way to lotteries – the Internet.  With the Department of Justice’s latest decision concerning gambling on the Internet, the way appears clear for every lottery to begin selling tickets online.  Okay, no big deal one might say, but again with a billion dollar jackpot, sitting at home buying tickets could be pretty attractive to a lot of people.  But that is not the real threat, the real threat is online poker; the DoJ ruling may also have opened the door to online poker via state lotteries – call it poker if you wish, but it is more likely to be just like the casino version – a slot machine. At that point the lotteries will be very serious competition for the casinos.  Duck, I see a very big wave on the horizon.

 Three members of the Maine Legislature’s Veterans and Legal Affairs Committee attended a meeting of the National Council of Legislators from Gambling States earlier this month and all agree Maine needs to move swiftly to update its gambling laws and take advantage of new flexibility…There is so much happening, it is just amazing…“That means we could sell lottery tickets online, people could buy their tickets from home and never visit a retailer,” Plowman said. Mal Leary, 1-16-12

The foreign policy of every country is based on one fundamental belief – the existence of other nations and governments that represent the people of those nations.  The United States has diplomatic and other ties with nations – Spain, Germany, Italy, the United Kingdom and so forth continent by continent.  But most, if not all of those countries are recent creations and within their borders are other countries or tribes of people who are unwilling participants in nationhood.  The countries of the Middle East were created in the aftermath of World War I for the most part, in Africa the process is still playing out, but the groupings of peoples we think of as nations are the product of colonization by the European countries in 19th and early 20th century. Even the European countries are the product of development of the last hundred or two hundred years.  Most countries in the world have within their borders “other nations.”

There are some exceptions to my assumption of nations within nations – and those are the product of colonization also. The difference between the United States, Canada, Australia and New Zealand and Africa or the Middle East is basic; in Africa and the Middle East the indigenous population was left in place when the state was formed.  However, in those English speaking countries the indigenous population was nearly eliminated and the remaining tribes were put away from the path of the “settlers.”  Therefore those countries had a clean slate upon which to write their national narrative; the rest of the world does not have that luxury.  Not in Asia, not in the Middle East, not in Africa and not in Europe.  Europe? Yes, Europe – since the end of the Soviet state we have witness many examples of former nations breaking down into small states that represent the ethnic make up of the region.

The classic example may be England and Ireland – the Irish view and the English view of nation have not agreed for a long time.  Nor, it would seem has the Scottish and the English view been in agreement, not in the 300 years of being united and the formation of the United Kingdom.  Scotland is set to vote on its independent sovereignty sometime in the next two years; it is not certain that the people of Scotland will vote for total independence. But one thing is certain -  after 300 years of British rule, under the surface there is another country, another culture and yes another language demanding its own voice.

Salmond, who appeared to be trying to distance himself from the argument, reiterated the Scottish government’s stance that the referendum should be “organized in Scotland, built in Scotland for the Scottish people, discussed with civic Scotland, and brought to the people in 2014 for a historic decision on the future of this nation.” On Friday, he invited Mr. Cameron and his deputy  Nick Clegg to Edinburgh for “constructive dialogue” about the the issue. Cameron’s UK government prefers a vote “sooner rather than later,” possibly within the next 18 months, and disputes Edinburgh’s constitutional right to hold a legally-binding referendum without new powers being devolved by London. The British government’s perceived interference in what Scots consider a domestic issue is what touched off this week’s spat. Christian Science Monitor, 1-13-12

If that is true in the British Isles, just how long do think it will be before the leaders of Iraq, Tunisia or dozens and dozens of other countries will be able to create a “nation” that commands the loyalty and support of all of the people within its borders?  Should that not be part of our foreign policy thinking?

Filed under: Today's Global Gaming Review ]]> http://lylegates.wordpress.com/2012/01/15/things-to-ponder-nations-and-tribes/feed/ 0 lylegates David Cameron and Alex Salmond http://lylegates.wordpress.com/2012/01/13/viva-la-dead-and-long-live-the-mourners/ http://lylegates.wordpress.com/2012/01/13/viva-la-dead-and-long-live-the-mourners/#comments Fri, 13 Jan 2012 21:15:28 +0000 Ken Adams http://lylegates.wordpress.com/?p=2948 ]]>

You’d better watch out, you’d better cry. You’d better pout, I’m telling you why: North Korea’s punishing insincere mourners, according to the Daily NK.  An anonymous source tells the Daily NK, a South Korea-based publication in opposition of the North Korean regime, that “authorities are handing down at least six months in a labor-training camp to anybody who didn’t participate in the organized gatherings” to mourn the death of Supreme Leader Kim Jong Il, and to those “who did participate but didn’t cry and didn’t seem genuine.” Huffington Post, 1-13-12

When I first wrote about the North Koreans supreme acting skills as mourners, I speculated that people might be afraid not to mourn, fearing governmental vengeance for those who failed to clearly demonstrate their deep, deep and very painful grief.  Today, thanks to AOL and the Huffington Post, we have a story being reported by a South Korean media source that North Korea is indeed going to prosecute those who did not mourn enough or properly.  However, with a sense of equal justice North Korea is said to be prosecuting those who mourned too much and lacked the proper sincerity. There is nothing in the report to indicate what the appropriate level of sincerity and grief look like.

Was the right level of pain and agony demonstrated by the wailing and weeping mourners falling to the ground as the procession passed?  Was it the tragic, but still composed news anchor, later called a national hero, reading the Dear Leader’s obituary to a distraught nation? Or was it, the son of the Dear Leader, standing deadpan, emotionless and rigidly at attention during the funeral? Talk about confusing, the state media broadcast images of thousands and thousands of mourners, no two alike – except in the competition to be the best.

For example, at the state funeral, the generals mirrored the heir apparent competing to be the most somber and staunch.  After all should not the son be the proper role model for the nation?  No, of course not, he has special privileges.  Now if I was a prosecutor, I think I would have chosen one of the street scenes as the model of correct, proper and sincere mourning and judged everyone else by that standard.

And then whoosh with one fell-swoop you could execute all of the generals, the son-who-be-king and the state media talking heads for improper and inadequate mourning.  That would leave the country in the hands of the hysterical women mourning the dead – a fitting legacy for the Dear Leader and his desire to make all of his people happy.  With all a whole level of government and power suddenly dead, the mourners would have many more people to mourn.  The mourning could last for years, the YouTube advertising revenues alone would feed a starving, but leaderless nation. Viva la Dead! Long Live the Mourners! Mourn oh ye mourners, mourn!

Steve Wynn at the entrance of the captivating atrium at Encore Las Vegas. (Photo courtesy of Wynn Resorts.)

The largest shareholder and vice chairman of the Wynn Resorts Ltd. board of directors has sued the company, claiming he has been denied access to the casino operator’s books and records. Kazuo Okada said in documents filed in Clark County District Court and with the U.S. Securities and Exchange Commission that “despite several written demands, Wynn Resorts insists on keeping its books and records hidden” from him. Okada indirectly owns 19.66 percent of Wynn Resorts and is one of the company’s founders, investing $260 million in the predecessor of Wynn Resorts in 2000 and another $120 million in 2002 to be used for casino development in Macau. Howard Stutz, Las Vegas Review-Journal, 1-11-12

Steve Wynn has lived a charmed life in the gaming world, a life with an ever expanding bankroll to fund his dreams – he is now worth $2.3 billion.  Wynn, more than any single individual has shaped the gaming industry by his presence and his ideas.   Steve got his first big bankroll, $6 million, by buying a piece of land that Caesars Palace needed to expand, but could not buy.  Steve did buy the land and sold it to Caesars for a very tidy profit; he took that money to downtown Las Vegas and in time gained control of the Golden Nugget.  After a couple of years reinventing the Golden Nugget into an upscale property in the decidedly non-upscale downtown, he took his money, his guts and enthusiasm to Atlantic City.

In the east Steve Wynn found, his now junk bond buddy, Michael Milken and built the Golden Nugget in Atlantic City with money Milken helped him find.  A few years later after tiring of the heavy hand of New Jersey regulators (he promised never to return until they changed their approach to regulation), he sold the Golden Nugget to Ballys for $400 million.  Mr. Wynn took his now much larger bankroll back to Las Vegas, this time to the Strip. In 1989, Wynn opened the $630 million Mirage; pundits, analysts and his competitors said it would be impossible to make the million dollars a day he needed just to crack the daily nut.  The Mirage more than cracked the nut it made record profits; Wynn followed the Mirage with Treasure Island and Bellagio.  In 2000, Steve sold the bundle to MGM for $6.6 billion – a serious bankroll even for him.

Some people would think that was enough, but not Steve Wynn; he immediately started on his next project was aptly named, Wynn Las Vegas – he double it later with an Encore and a Wynn Macau.  In the 40 years that he has been involved in the world of casinos, Steve Wynn has consistently done the same things.  He has introduced an endlessly stream of new ideas, ballsy architecture and design, he has taken huge financial risks and reinvented the market place time after time.  Wynn has also always been the man in charge, he makes the decisions and hates reporting to anyone and that includes Wall Street and gaming regulators.  He left the public market once, declaring that he hated the process of quarterly reporting to people who did not understand his methods.  That is also pretty much what he told the regulators in New Jersey – they wanted too much control.  In both Nevada and Macau he has found regulators who really, really want him in their jurisdiction and do all they can to please him.

Yesterday, the vice-chairman of the board of Wynn Resorts, Kazuo Okada, a long-time friend and investor in Wynn enterprises sued Wynn, the corporation, not the man, because it refused to give him information about its expenses or involve him in some decisions.  Partnerships are like marriages in many ways and like a marriage it is unwise to enter a partnership thinking your partner will change, they don’t.

Steve may have advisers, experts and specialists to help him make decisions, but he has never had a partner.  Mr. Okada was an investor who became confused and thought he was a partner. It often happens in partnerships; all partnerships are formed to make money.  As long as things are going well the individual partners are apt to get along and respect each other for what they bring to the venture.  But in bad business times or when one of partners has a personal or separate business crises or simply when one of the partners gets older and has different goals and risk tolerances things are apt to come unglued.

Mr. Wynn and Mr. Okada are likely headed for divorce court, probably because they both misjudged the other, or expected the other to change and adjust to a new arrangement they imagined would follow forming the partnership.  Adapting, compromising or taking directions is not something two dominate, alpha males do.  Each of these two is each nearly 70 years old and with a billion dollars or more in the bank they are not going to change – at least not before they turn 90.   Stanley Ho gave up the reins last year, and Kirk Kerkorian sort of has given up the reins of his empire- but they are both in their 90s.

Today I walked by the local occupy site – Occupy Reno.  There were only few people, most looked like street people, cold and huddling together around the coffee,.  There was one young man with a beard who might easily be a university student on his semester break.  A couple of the protestors, the young man with the beard was one,  held up signs calling for an end to corporate greed.  The message doesn’t really resonate with me, I cannot see what practice course of action is open to the movement; revolution? Just how are we going to end greed, corporate or other wise?

Still the idea of corporate greed may deserve some thought – is that what got us in this mess, greedy bankers, stockbrokers and Fortune 500 CEOs?  It sounds good, the kind of message that can polarize a society and put the blame for all of the social evils on the “one percent.”  Still, it does not resonate with me – those greedy corporate bastards are not the only greedy people who might have had a hand in the debacle.  I know for example that I was part of the problems we face.  I bought things cars, electronics and stocks in the run-up; the increasing prices did not slow me down only made me more eager for the potential profits.  In fact I probably drooled over my month stock portfolio results, calculating the increasing values and dreaming of wealth and happiness.  The only sin I did not commit was buying a house in that market – not because I was smart and could see the trends, but because I could not finance a purchase in that inflated market.  I would have, if I could have.

Isn’t that what happened to the economy, we all bought into the myth of continued growth; we spent more than we earned, we piled debt upon debt and bought houses, stock or tulips seeing not the danger, but rather the profits.  I found a couple of stories on housing from Las Vegas this week that led me to thing more about the issue.  For example, more houses sold last month there than any other month in Las Vegas history – what?  Well of course those sales were distressed sales, foreclosures, bankruptcies and short sales.  New-home sales plummeted from nearly 39,000 in 2006 to fewer than 4,000 in 2011 and the medium price hit $120,000; in 2006 you could not have bought a storage unit for that price.  Retail vacancies also set a record for the month – that was is easier to get, all of the retail space that was built on the “come” still stands vacant – hell, CityCenter has an entire hotel tower that stands empty; they say because of faulty construction, but the builder says it is because of faulty thinking – MGM thought to finance about one third of the $9 billion project with condo sales.  And then the market for condos disappeared; but Las Vegas is not the only place with dozens of empty or half filed condo projects, Reno has its share too, as do most of the cities that were on the leading edge of the real estate bubble.

Condo sales was the story that really caught my eye this week.  A condo project, Luxe Lofts, is getting a new lease on life; in 2008 the ambitious $38 million 83-unit project hit a bump, the economy.  By 2009 the developer filed for bankruptcy, worked had stopped and no units were sold.  Since then the bank has owned it; in May the bank found a buyer.  Another developer who thinks the price is right.

In 2007 it cost $540,000 a unit to build; in 2011 – the new developer paid about $80,000 a unit , the estimated cost is now about $100,000 a unit to build and he has to finish the construction before he can sell any units.  When it is finished the units will start at $190,000, a far cry from the $400,000 plus in the mind’s eye of the original developer in 2006.  Now, maybe greedy bankers loaned too much money on impractical projects, and maybe the greedy construction companies charged too much for their work and maybe greedy real estate investors standing in line to buy anything that came on the market caused Luxe to fail.  But maybe, just maybe, so did all of the people, not just in Las Vegas, but all over the country who bought real estate in that market also share the guilt.  How many “just plain folks” bought house with the intent of “flipping” them within a year or two and pocketing their windfall profits? I think we all share in the responsibility for this mess; and the sooner we accept that the sooner we can get finding real solutions and not looking for someone to blame and punish.

Egyptian anti-government activists clash with riot police in Cairo in this file photo. Thousands of anti-government protesters have poured into the streets of Egypt, demanding more political freedoms. AP photo, Turkish Daily News, 1-9-12

Forty years ago, or there about, I started to think about a musical based on World War I; the idea came to me while I was walking my neighborhood.  On my walks, I often passed a VFW Hall – you know, veterans of foreign wars. The building was named after Darrel Dunkel, the first person from Reno, Nevada killed in WWI. That war gave birth to the VFW and a very short lived belief that WWI was the war that would end wars; walking around Reno in the 1970s, I was living in a world that had experienced constant war since WWI ended.  The United States has been in a few, WWII, Korea and Vietnam at the point – but there many, many other wars besides.

The title song of my imaginary musical was dedicated to Private Dunkel – “Darrel Dunkel, Darrel Dunkel, where are you? Where are you?  Darrel Dunkel, Darrel Dunkel, Why did you die, why did you die?”  The complete musical would have explored all of the war and strife in the 50 plus years between his death and the 1970s – always returning to that refrain, asking Darrel once again where he was and why he had died.  If I were to attempt the same thing today it would have to be called Mohamed Bouazizi, after the young man whose suicide, December of 2010, is said to have started the Arab Spring.

Looking back into history, that is always a valid question – why? Caught up in the moment and the passions of nationalism, tribalism or religious fervor people say and think one thing, but at some point afterwards, it is difficult, if not impossible, to find anyone who still believes the mantras of war.  Time simply acts to change one’s perspectives, but how much time does it take to let go of the emotions of the moment and take a more objective point of view? Some times not much.

Lately groups of radical Salafis, they are calling themselves committees and model their committees around the Saudi Committee for the Promotion of Virtue and Prevention of Vice, have been going around Egypt trying to impose their values on public behavior.  They have been telling shop owners “they could no longer sell ‘indecent’ clothing, barbers could no longer shave men’s beards, and that all retail businesses should expect regular and surprise inspections to check for compliance.  The have also smashed Christmas trees and decorations in front of stores and malls, declaring the celebration of Christmas “haram” or forbidden.

In one town they raided a beauty salon, telling the women their behavior was indecent and they would be punished if they did not cease, close the shop and go home behave like modest, observant Muslim women.  The women took exception, beat the enforcers with canes and kicked them into the streets.  The committee has also met some resistance from more official, Muslim sources, Al Azhar suggested the group had no legitimacy.   Al-Nour, the official Salafi party denies any connection with the group, even though al-Nour is the party that got the votes the committee claims gives it a mandate.  The group’s response to Al Azhar was au contraire, “we have a mandate from the people.”

“The Committee, which millions of Egyptians have agreed to, and expressed their desire to see its members diligently apply God’s law, draws the attention of our brothers in Al-Azhar to what happened in the last elections when millions of citizens voted for Salafi parties,” the committee’s statement read. Al Arabiya, 1-9-12

Do they have a mandate?  Between the Muslim Brotherhood’s Freedom and Justice party and al-Nour they have received over 60 percent of the votes thus far.   The Free Egyptians’ Party, a liberal party, is threatening to boycott the next round of election, because the Islamic parties are not playing fair.  And on occasion Tahrir Square still sees a demonstrate reminiscent of those that toppled Husni Mubarak.  It is less than a year since Mubarak was forced out of office, but it has been long enough to wonder – why?  Or maybe, just what is going on here anyway?  Mubarak is on trial for his life, lying on a bed, pretending to be dying, while he is devising ways to get all of his enemies on the witness stand.  The Army is still in control and maintaining its control with force.  A Coptic Christian business man is going be tried for blaspheme after tweeting a caricature of Mickey Mouse and Minnie Mouse in Islamic garb; Coptics and Coptic churches have been attacked.  Blogs have gone to jail, demonstrators claim to have been beaten and raped, some with video evidence to back up the claims.  The election procedures continues.

Egypt and the Arab Spring have slipped from the American media stage, the media has moved off to follow the republican presidential campaign, the defense budget and moving our focus to Asia and the Pacific – read China.  However, our lack of attention has not reduced the violence or confusion that continues in the wake of the Arab Spring in the Middle East.  Maybe it is too soon to ask, why – but it is still a difficult question to avoid.  Haven’t you wondered why about Iraq or Afghanistan at least once in the last couple of months?  Don’t you wonder if Mohamed Bouazizi, Darrel Dunkel or millions of others who have died a wars in the last century might be asking why?