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Report From Las Vegas

I am writing you from the poolside cabana B-2 at the Bellagio Hotel in Las Vegas. It is 90 degrees in the shade and the air is bone- dry, so I'm on my third banana daiquiri for the day. I can relax here these days. The days when I risked getting my hands broken with a hammer for card counting have long since passed. May Bugsy Siegel rest in peace.

It is shocking what passes for a tattoo these days, and where they end up. I see young women with elaborate Chinese and Japanese characters inscribed in some pretty immodest locations. Reading this unfathomable language myself, I can tell you that they look like they were brushed by a two year old or are completely unintelligible.

I've never been big on regulation, having spent a lifetime in financial services and aviation, the two most controlled industries on the planet. But really, a 400 pound woman in a bikini? There ought to be a law! Lycra should be a privilege and not a right!

As with all of my visits to Sin City, I made a beeline to my inside guy here -- a blackjack dealer at Caesar's. It's been a slow summer and an even slower fall. With global warming delivering the hottest summer in history, the last place tourists wanted to visit has been the desert. Midwesterners have been particularly hard hit, as the heat has caused crop failures on a Biblical scale and shriveled incomes. Still, business has been infinitely better than 2008-2009, and most hotels are modestly hiring.

It is wonderful strolling through the finally completed City Center. The glitzy, ultra-modern, Cesar-Pelli-designed, 16.8 million square-foot, 63- acre complex occupies a quarter-mile on the city's fabled Strip between the Bellagio and the Monte Carlo Hotels.

It will unquestionably become one of the hedonist Wonders of the World. It includes the Mandarin Oriental, Aria, Veer, Vdara, and Harmon Hotels, offering 4,000 rooms and 2,600 condos. They will be adorned by two casinos, a convention center, a new theater for a soon-to-be-launched Cirque du Soleil show called Zarkana, and parking for 6,900.

President Obama is in town, holed up in Lake Las Vegas in preparation for his Wednesday debate in Denver with Mitt Romney. The location speaks volumes. A complex of high-end homes sprouting magically out of the desert around a huge artificial lake and several golf courses, the project just initiated sales when the bottom fell out of the market. The lake turned green from algae, the grass on the fairways died, and within a year, houses could be bought at foreclosure auctions down 75% from their cost.

A couple of years ago, some brave and deep-pocketed investors bought it out of bankruptcy for pennies on the dollar and have been slowly rebuilding it. The lake is blue again, the greens are green, and sales have resumed at a trickle. It was ideal for Obama's staff, who needed 50,000 square feet at an isolated venue for a short-term let in a hurry. But the helicopter tour companies have been squawking like crazy, as they have been shut down for the duration of his stay.

No matter how healthy the rebound in Las Vegas may be, the forlorn Fontainebleau Resort remains abandoned. The $3 billion, 4,000 room, 68 story hotel, casino, and condo project was to be one of the city's grandest yet. It was 95% complete when the crash hit and construction ground to an immediate halt, wiping out all of the original equity investors. Nobody does creative destruction like America.

Raider, Carl Icahn, bought it for $156 million, then flipped the furniture for $200 million, getting the hotel for free. He is sitting back waiting for a foreign sovereign wealth fund to buy him out at a huge profit. That is what Carl does, bless his soul. In the meantime, the towering structure stands as a monument to the hubris, greed, and excesses of the 2000's.

My global strategy luncheon at Caesar's Palace was a total blast, as usual. There was much speculation on the market impact of QE infinity, the implications of an Obama win in November, and the chances of war with Iran. The guessing game was for which taxes would go up and how much. The big question was how soon to position for the Great Crash of 2013, which seems a certainty. Gold has a great short term future.

However, navigating this immense convention center can be devilish. Some of my guests went to the U.S. Aids Conference in error, while some of the AIDS people visited my lunch by accident. They were politely redirected. This is why I always tell people to allow an hour just to get from the parking lot, past the dancing girls and craps tables in the Casino, to their seat at my table.

I always enjoy doing these lunches, as the feedback I gain from readers is invaluable. Not only do I learn about new, unexplored asset classes and local micro business trends, there are always good suggestions on how I can improve my own service. I also have to confess that hearing about the latest Internet rumors and conspiracy theories is a real hoot.