It seems that Nevada’s biggest casinos lost $1.3 billion last year:
Nevada’s major casinos reported a net loss of $1.35 billion in 2013, the fifth straight year of losses.
The casinos reported $23.9 billion in total revenues, or a 0.4 percent gain from fiscal 2012. The net loss was 11.2 percent more than last year.
The state’s 263 casinos that gross at least $1 million in gaming revenues have not reported a profit since 2008, Lawton said.
I spent just over a year and a half in Las Vegas, finishing my bachelor’s degree at UNLV. Every weekend, the streets and casinos were full of tourists and others who spent a lot of money in the casinos. And the casinos were making an obscene amount of profits.
I always tell my students that if they want to get rich, they should open a casino. The basic idea behind running a casino is that people come in the door and give you their money. They do this by playing various games of chance, where the probabilities of a player winning is very low. This results in the casino keeping 97-99% of all the money gambled. If done correctly, operating a casino should make you very, very rich.
What might the reasons for these recent losses be? The possibilities are:
1. The casinos lost money due to a run of bad luck. Yeah, right. Gambling games are designed so that the house will win. They are also designed so that even if a few gamblers win, the casino will still make a profit. And if someone gets too lucky, they will be ushered out of the casino and told that they can never come back. Or worse:
2. The casinos lost money because people didn’t have the disposable income available to
waste spend gambling. Yep, that could be it. Notice that the casinos haven’t been profitable since the Greater Depression Great Recession began in 2008.
The point is this: if an industry where there is a built-in market for profits is having losses instead, what does that tell you about the health of the economy overall?
All is well???
Categories: All is well!!!