By ‘casino’, I’m not talking about strip mall storefront casinos. I’m talking about big, Las Vegas-style ones like Taj Mahal was. How often do casinos of this type go into bankruptcy? Is there a list?
Tripadvisor has a list, but it’s limited to Las Vegas, and of course the reliability of a list compiled by Tripadvisor is questionable.
I would say the rate at which they go bankrupt is about the same as for other major facilities in the entertainment industry, and for the same reasons. The casinos we’re talking about are multi-million, or even billion, dollar entertainment behemoths, and like other such facilities (e.g. theme parks), they can fail when they don’t manage to cater to the taste of patrons. Players “breaking” the casino by winning big is not an issue; there is too much money involved in that business, relative to the maximum stakes (and resulting maximum winnings) for that to become problematic.
Given that almost 20 of the 30 Las Vegas Strip casinos are owned by two companies (MGM and Caesar’s), the likelihood of bankruptcy of a big Vegas casino is dwindling yearly.
There’s some basic data out there, e.g., a partial list of defunct Vegas casinos on Wikipedia.
The use of the word “bankrupt” creates a problem. A lot of casinos have shut down without actually being bankrupt, esp. in Las Vegas. The old owner is tired of losing money, it’s sold to someone else who demolishes it and builds a new place with a new name. An example of a Vegas casino that went bankrupt is the Moulin Rouge. Opened in May 1955, lasted all the way to October 1955. :eek:
But Vegas is different from Atlantic City. Real estate in certain areas of Vegas is very valuable, so buying a dying place and building a new one makes sense. Atlantic City has not been like that for a long time. (The Indian casinos in the region have put the kibosh on the place.)
A lot of casinos don’t go bankrupt so much as they are not thought to be making as much money as they could be making so they get sold and demolished for a fancier new casino. Or, like with Westward Ho! they get sold and end up in limbo as new owners try to figure out what they can do with the place and shut it down before they have anything ready to build.
ever notice that until the feds ran out the mafia in Vegas that a casino going bankrupt was even a thing?
Because it’s harder to go bankrupt when you’re cooking the books and not paying the taxes.
Another way to view it - a mob casino is providing two services. It’s both making money from gamblers and also providing a money laundering service.
Thinking about it, it would make sense for a mob run casino to offer discounts on the rooms and food so it always looks full. That way it’s more plausible that the casino is making so much money. (Including both real profits and laundered money). A money laundering casino need not even break even on the main business. Guess this is why my parents talk about how great Vegas was to visit in the 70s and 80s.
Formally declaring bankruptcy is a drastic last measure. What more typically happens is “restructuring”: the financial backers of a struggling business (or if necessary their backers) cite whatever provision in the original contracts that allows them to take over ownership/management of the venture, take tax credits for adding the liability to their books, and then either secure new funding or do the teardown mentioned earlier. Modern finance is based on minimizing risk and distributing the liability; which is why the housing bubble crash was so scary: for a while it was looking like everyone was going to get dragged off the cliff.
Do you get a commission for new subscriptions to ft.com ?
Is this why Moe Greene’s casino was losing money?
If you land on it via Google, you’ll be fine to read it. This happens reasonably often with paywalls, and if you do a direct link, it’ll lead to the paywall, but if you link from one of the website’s whitelisted referrers, you can read the link. You can also try opening the original link in an incognito window, but that didn’t work in this case, as this website is not set up that way. Anyhow, the person cut & pasting the link would not even realize it’s paywalled unless they tried going to the link directly themselves.
Here’s the first link. Just click on the top result.
And, actually, silenus’s second link also leads me to the same place, and the link above is actually meant for the Caesar’s story, not the MGM story.
Thanks for the tip. I hope I remember to try it next time.
The article was very interesting. (And reminds us
that it is OK to swindle Billions on Wall Street with white-collar crime, while just a few blocks away, a black is being strangled by cops for selling loosies.)
The Feds certainly had a hand in it, but a more major one was the state gaming commission deciding that big corporations could own casinos. Up until about 1978 or so every stockholder had to be investigated and be issued a gaming license. This meant the clubs were either owned by the mob (deep pockets) or eccentric individuals (I’m lookin’ at you, Howard Hughes) or really small corporations – the club I worked at in Crystal Bay was owned by a twenty-owner LLC.
After that date, any exchange-traded corporation could hold the license, and only those stockholders with 5% or more equity had to get an individual license. The big resort corporations had even deeper pockets than the mob and bought 'em all out.
[Moderating]
septimus, while that may be an important thing to remember, this is not the place to remember it. Keep the political commentary for the political forums.