An excellent piece.
One aspect that keeps coming up for me is how terrified of posting bad short-term numbers the casinos are now. I spent many years working for a large privately-held company. And one of the big advantages of being private was that we weren't beholden to our quarterly numbers. The firm could make long-term decisions that were truly about the long-term, without being concerned about whether Wall Street would freak out about their short-term impact on the bottom line. The firm could choose to take advantage of new opportunities for future profits without concern over whether the firm's name would be dragged through the mud for missing a quarterly estimate.
Everything I see from the casinos these days when it comes to holds and payouts is panic about the short term. It doesn't make sense. By definition, building a $10m or $100m or $1b casino is a long-term decision. But the people managing the slots and promotions refuse to look past this quarter or this month (likely because their bosses won't let them). It's all the worst aspects of Wall Street decision-making rolled into one.
Posted by: C <clementiyn@yahoo.com>
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