Expanded Casino Gambling Up, But Economy Could Hurt Business

 

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Casino gambling expansion is something that is at an all time high around the United States. Many states have already started their expansion efforts. Others have Bills in the works that would do the same.

The timing, however, is not good for this expansion to be taking place. The economy is headed straight for a recession. That means that extra entertainment money that could be used for gambling, will not be flowing freely out of people’s pockets.

Some casinos around the nation have already stared feeling the effects of the economy. Numbers are down from last year at some casinos, while others that have been watching their revenue increase, are now in a holding pattern.

“There’s no doubt that at the lower end of our business, we’ve seen some softening in occupancy, some reduction in spend. That’s clearly the result of the economy,” said Jim Murren, President of the MGM Mirage, in an interview with Reuters.

Hotels that have casinos are used to having big conventions to fill up their rooms. Those conventions also bring gamblers to the gaming tables and the slot machines. With fewer conventions taking place due to the economy, it will directly affect casinos.

While nobody will feel sorrow for these casinos that have made billions of dollars from gamblers, it will be interesting to see just how much the economy hurts the industry.

Tropicana and Bondholders Squabble Causing Trouble For Casino Sale

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Tropicana Entertainment LLC has lost the license for its Atlantic City casino and is in the middle of selling the casino. A battle with bondholders, however, is causing problems in the casinos potential sale.

Tropicana is claiming that bondholders are hurting the potential sale of their Atlantic City casino. The casino was stripped of its license last year for not keeping the casino up to a first class level.

The Atlantic City casino has been placed into the hands of a trustee. On Friday, Tropicana made their case in court filings that they did not default on a $960 million note since losing their license.

William Yung III is the owner of Tropicana and lost control of the casino back in December. Bondholders believe that they are within their rights to be paid now, before the sale of the casino.

Tropicana has an agreement with banks that they will sell not only the Atlantic City casino, but also two others before June. This will take care of some of the debt the company has accumulated.

The company claims that even though management has changed, bondholders do not have a right to declare a default because ownership has never changed hands.

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