Rethinking the Consumer Recovery: Even Gambling Is Down

It's not quite the proverbial canary in the coal mine, but it looks like one. Heck, when even Joe Sixpack's formerly obsessive spending habits are on the defensive you know something's changed. Such is the message that even gambling revenues from casinos and lotteries are facing a downfall for the first time, according to The New York Times.

"The decline [in gambling] comes as states are rapidly expanding gambling in hopes of stemming severe budget shortfalls, and it indicates that gambling is not insulated from broader economic forces like recessions, as has been argued in the past," the paper reports today.

Among the reported losers: Illinois' gambling revenue is off $166 million in fiscal year 2009 vs. the year earlier; Nevada suffered a $122 million retreat; and New Jersey claimed its slide was $62 million.

Is nothing's sacred in the Great Recession's reordering of spending priorities? Apparently not, with the possible exceptions of Washington's immutable habits with money and certain personal services performed in red light districts. Otherwise, Joe Sixpack's playing a new game these days and it isn't roulette. If you can't count on the crowd's arrival in Vegas and its lookalikes around the country, good luck with trying to sell an extra truckload of wide-screen TVs next week.

Comments

[Mad Hedge F...:]

piul. Consumer credit plunged by $21 billion in July, taking it down to the lowest level since WWII. The last time it was this low wartime rationing was in effect and a lot of individual purchases ended up in a booming black market. Instead of buying that new Cadillac Escalade with the chrome wheels, they are paring down debt. Gun shy credit card companies are happy to take the money, and American express has been cutting back limits in zip codes with the weakest housing like California and Florida, even for current accounts. Banks have gone back to lending only to people who don’t need the money. The savings rate has gone from zero to 7%, on its way to 10%, not exactly a great springboard for an economic boom. The catatonic consumer is the main reason why I have not played equities from the long side since May, preferring instead to dabble in commodities. With 70% of GDP in shrink mode, any move up in the indexes is just fluff.

Sep 10 02:24 PM

[oldmaninPA:]

I was at the Trop in Atlantic City last weekend and it was packed...I even contributed some funds to the struggling industry...he he.

Sep 10 10:34 PM