LAS VEGAS, NV: Confused by the numbers coming out of Las Vegas? Don't be. Everyone is confused. Gaming revenue fell 9.25% in the month of October 2019 compared to October 2018. Tourism fell .3%. Room rates fell 5% as did average guest receipts. However, McCarren Airport boasted the busiest October in Las Vegas history.
Michael Lawton was baffled as well. Michael Lawton is senior research analyst at the Nevada Gaming Control Board. He cannot understand how October 2018 had the highest gaming revenue numbers in history to this enormous 9.25% drop in gaming revenue. Especially for the last three months Miochael has been bragging to the press about the extraordinary revenue numbers. Michael did not have the ability to analyze the reports from the casinos to see that they were pushing the numbers from quarter to quarter since 2018. Or he works for the casinos. Because anyone who has walked down the Las Vegas Strip since 2017 could see that the rooms were full but the casinos were empty. The casinos were selling cheap rooms to keep the tourism numbers up. Unfortunately those tourists only wanted to go the Hershey Store.
As expected, the average room rates fells 5% as did the amount spent per guest.
Surprised? The Las Vegas Sands (NASDAQ:LVS) Owns the Las Vegas Review-Journal
We have been writing that the numbers reported by Rick Velotta at the Review Journal have been misleading for over a year. Recently, the biggest clue that the bottom was going to fall out was when the Las Vegas Review-Journal sent to the AP the headline "Nevada Gaming Win Eclipses $1B in Historic September". That would be a sign to invest.
But wait what? September was slow as snails compared to previous years.
The casino's CFOs give their numbers to the Gaming Control Board (GCB). The GCB analyzes the numbers and gives them to the Las Vegas Review-Journal. The Review-Journal the sends a headline and the condensed reports to the AP wire. The AP Wire sends the headlines to Wall Street. As Citizen Kane once said: "Its not the size of the news, it's the size of the font". Everyon buys in October. Now everyone sells in November.
The CFOs at the Venetian and the CFO at Review-Journal are one in the same. Patrick Dumont is the CFO for the Las Vegas Sands Corp (NASDAQ: LVS). The Las Vegas Sands bought the Las Vegas Review-Journal in 2015. Patrick can write whatever headlines he wants the paper to read because the reporter assigned to cover gaming is Rick Velotta. Rick Velotta is like Bruce Willis in 16 Blocks. He is a tenured journalist that is waiting to retire. He doesn't want to rock to boat . That is how the the Las Vegas casinos scam Wall Street. We will see how Sheldon Adelson and the Las Vegas Sands use the Las Vegas Review -ournal to be a political machine for Donald Trump in 2020.
Baccarat is Always to Blame for Missing Millions of Dollars
The biggest culprit was baccarat - the game least game played by the masses. Baccarat would be the easiest to fudge numbers. This would indicate that the VIP baccarat players that boosted record revenues in 2018, might not actually exist. Harsh words for a town that barely remembers the lives of 58 people lost in the worst mass shooting in American history only two years ago. They removed to memorials and they rarely talk about the shooting because they are afraid that it will hurt tourism. Lying and convincing the public is one method to get through a tragedy. Another one would be to tackle it head on with a memorial on the Strip for tourists to visit. And maybe even a "tour room" of the room where Steven Paddock stayed. They could stage it exactly as they found it on October 1st 2017.
Sound too crazy? Well, so is sending misleading numbers to the LVCVA. Since the CFOs and the LVCVA do not have an explanation, please post any other reasonable explanations below for why Las Vegas saw a huge decline in gaming.
We have been saying this for over a year. The casinos have been reporting misleading numbers by pushing their sales from quarter to quarter. Like a desperate gambler, they believe that they can always make up their losses next time by betting more. If you listen to the analysts talk about Las Vegas, they are so optimistic it makes you wonder if Sheldon Adelson bought them too when he bought the Las Vegas Review-Journal in 2015.
Conventions Dropped 21% November 2019 Compared to 2018
Chad Beynon, the Wall Street analyst covering Las Vegas stocks for Macquarie Securities says they missed their numbers but that's okay because November and December will make up for the losses. Does Chad sound like a desperate gambler who thinks if he just bets more money, he will make up his losses?
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