More on Waiting – Waiting for General Motors and dancing on the table

Interview With Cheryl Burke: Come Dancing!

Yesterday’s post dealt with two things; Las Vegas and casino investor/developers holding onto property on the Strip waiting for some sign that the economy is improving, the downward trend has reversed and an upward trend has started; the second was also land investment, in Reno, where the investors were not anticipating any near-term improvement, but saw land at very low prices as good hedge against inflation in the long-term.  Both are symptoms of times when many people with money to invest are waiting until the think they see the right time and opportunity.  Over the last year or so, I have heard numerous times “there is money out – lots of money, just waiting for the right time to step in and invest.”  I heard it yesterday again from my friend and saw an example of it first hand in that discussion.

Two major companies are testing that proposition and the public market in very different ways.  Harrah’s announced that some of its larger equity investors are interested in selling part of their investment in the public market; the other company is General Motors, now that it has turned the proverbial financial corner is going public again.  Both companies are relying on the proposition that “there is money out there.”  Both are hoping that the money sees their company as a good place to land; it also means both companies think there are enough signs of change to loosen the purse strings of those people sitting on the sidelines waiting.

According to the common wisdom the investors-in-waiting are waiting for two things – a bargain and a sign of changing times. That makes watching the progress of Harrah’s and General Motors worthwhile for the rest of us; if the money people indeed see what they need to buy an interest in either or both, that in-and-of itself may be a sign that things have indeed started to shift. Then the rest of us slow adapters can run out and spend money too – that is if we have any.

Here is another bit of change – a shift of opinions; the Nevada Control Board is recommending a fine for Caesars (that would be Harrah’s by another name – Caesars is Harrah’s regardless of the name on the marque). Employees of the baccarat pit at Caesars allowed a player to get up on the table and walk around to place his bets and then to do a little dance afterward.  It seems to me there must be too much pressure to get the revenue in today’s depressed economy if the employees could find no fault in doing a victory celebration.  After all for years it has been prohibited in sports,  the NFL forbids excessive demonstrations after a play and when my son was in high school 25 years ago they passed a rule against end zone celebrations. But then maybe the baccarat player had a star to dance with and the gaming agents didn’t notice the star or the television cameras.


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August 2010
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