One More Thing

This week on the podcast Ben and I spoke about casinos in Atlantic City and the challenges they’re dealing with. I went there over the weekend to watch the Super Bowl, and wow, things look pretty dire.

The place I stayed, Ocean, is a stunning hotel. The thing is, before this was Ocean, it was Revel, which was a colossal failure. Revel cost $2.4 billion and was sold a few years later for $229 million. I guess the buyers figured hey, for eight cents on the dollar, why not take a shot?

Not surprisingly, it looks like things Ocean is having trouble righting the ship. A listener sent me an article which revealed that the casino lost $23 million in the final months of 2018. Maybe the legalization of sports betting will stop the bleeding, at least temporarily. If you’re looking for a longer read on how the wheels came off Atlantic City casinos, check this out

We moved on to the Barstool Sports deal and the future of sports betting in the United States. A listener sent this over from the UK, who is a few years ahead of us with sports betting. This article offers a cautionary tale:

“I am concerned that offering people who are losing vast sums of money… free tickets, VIP experiences, and free bets, all proactively prompt people back into the vicious gambling cycle which many want to escape.”

Mrs Murdoch said the NHS had been forced to open 14 gambling-addiction clinics in a £2.3bn investment in mental health.

Later in the show I mentioned this chart which shows “the cost finance charges for intermediation”, which has fluctuated between 1.5 percent and 2.5% throughout the past 130 years. We have enough data on this that I’m fairly confident in saying that this pound of flesh is a permanent feature of our capitalistic system.

Lastly, we asked if economies need to bust, which led into a conversation about the mentality of perma bears. Some people are of the opinion that the fact that we just experienced our first decade without a recession to be a policy failure. They argue that the longer we put off the inevitability of a recession, the worse off things are going to be when it finally arrives. I can understand this line of thinking, even if I don’t necessarily agree with it.

Check out the conversation below.

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

The Compound Media, Inc., an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here:

Please see disclosures here.