Macau’s casino heads south

One of Macau’s embattled gambling bosses was having tea when someone walked in and punched him in the face, according to a WSJ news article. “That is the kind of year Macau has had” and brought a dismal year for the gambling enclave and its “powerful VIP gambling room operators.”

“Full-year gambling revenue is expected to have fallen by about a third compared with last year to $30 billion, roiled by China’s crackdown on corruption and capital flight. Revenue in November was $2.06 billion, the lowest monthly figure since 2010.

“The performance stands in stark contrast to that of the Las Vegas Strip, the world’s second-largest casino market, where the gambling revenue haul is expected to remain fairly steady, hovering at over $6 billion for the year. Though China’s policies have also cut into the revenue Las Vegas casinos used to make from prized Chinese VIP players, unlike Macau, the U.S. casino capital has other gamblers to pick up the slack.

“Investors who had been wildly bullish on Macau casinos have now grown frustrated. Shares of the five major Hong Kong-listed casino operators have fallen an average of 48 percent this year as of Tuesday’s closing price.”

But crashing revenue forced Mr. Wing-hung Kwok’s VIP rooms to shut, leaving him with financial disputes and considerable personal gambling debts—a common fate in Macau this year—one of the people said. Junket operators like Mr. Kwok have borne the brunt of the downturn with VIP gambling revenue declining 44 percent this year through November compared with the overall industry’s 35 percent fall and a 22 percent drop at mass-market gambling tables, according to data from Daiwa Capital Markets.

According to the police report, the reason for the attack on 57-year-old Mr. Kwok is unknown and the assailant, who fled the scene, hasn’t been arrested. A police organized-crime team is handling the investigation, the report said.

“Ownership of VIP gambling operations in Macau is often opaque. A spokeswoman for the Peninsula, which was crowded with tourists waiting for its famous afternoon tea at the time of the attack, confirmed that someone had been assaulted at the hotel.

“The changing policies are coming at exactly the wrong time for Macau’s casino operators, who are in the middle of a $20 billion expansion push.

“CLSA analyst Aaron Fischer expects return on invested capital to drop from 34 percent on existing Macau casino properties to about 21 percent for new resorts in the territory given the ‘evaporation’ of $10 billion worth of high-end players during the crackdown.”

It’s bad tidings we need to understand in our nose-end sight of an industry that is crashing all over nearby.

Unsolicited misery

With 51 percent of employees under the federal definition of “poverty income level,” you add others at the brink and the figure would balloon to more people suffering from income inadequacies quietly absorbing the vicious hardship. The federal poor income level is $24-26K per year for a family of two to four.

Center stage is in the 15 years of economic stagnancy—where nothing works navigated by toxic Republican charge—that found its way into fossilized family income. It remains the same while the cost of basic goods have skyrocketed.

I know it would be devastating to impose the federal minimum wage here. Imagine the more expensive “living wage” that “provides an annual income to afford adequate shelter, food and the other necessities of life.” It’s a legitimate view, though it also has its devastating effects on business that includes triggering unemployment.

The stagnant economy is bordering on becoming a permanent fixture here, if not already. This has got to change and it begins with a realistic plan how to grow the local economy. That policies are made in favor of certain investors while ignoring others hasn’t been of much help to encourage additional investments here. Affluenza has taken its seat making for a vicious cycle that shifted representation from “we the people” to the “we few.”

Amidst the sinking quality of life, families still have to deal with supporting college kids, monthly payment for the first family home and other costly obligations. How do they deal with fossilized income while enduring the slow but steady increase in the cost of other basic needs like food? Interesting how senators have recently given themselves $2,500 per month to cover needs while openly ignoring the dire needs of people they represent. Perhaps they’ve turned us into robots!

Recalled how joblessness devastated a friend who used to support his daughter in college. The kid had to put off her education for nearly two years working as a dishwasher to pay for her apartment and life’s necessities. As bad as economic depression has dealt families here, this is where they are today and still sinking steadily too. We’re still waiting for affluenza plans to improve the lot of families they’ve opted to ignore.

Evacuation: Six years ago more than 3,000 of our people moved to Guam and elsewhere in search of opportunities for their families. We in the media call it “relocation.” I beg to disagree. It’s more an issue of “evacuation” in search of greener pasture. It was a “now or never” issue.

While Puerto Rico suffers from a decade of economic recession, ours is far worse. We had to learn how to endure economic depression for nearly 15 long years. It means the income of employees in both sectors have remained the same all these years.

This condition, as it is happening in Puerto Rico, results in what’s known as capital flight—relocation, and in our case, evacuation of valuable human resources. This was basically triggered by the lack of opportunities to decently support the needs of families from education, health and others. Those who evacuated knew the impending hardship would be devastating. Incompetent politicians have built a vicious tangled web as their treasured trophy!