It all boils down to simple (?) math for casinos

Dec 8, 2009 5:02 PM
Diamond's Gems by Sid Diamond |

Every now and then I get stimulated by a subject other than sports betting. This day I’m into math, a subject I failed (algebra) in high school and had to waste the better part of a summer re-taking it to graduate.

As an adult, my math background didn’t improve, as I’ve bounced more checks than Carter had liver pills. This admission from a 35-year bookmaker may surprise you, but the one principal I always understood was you have to take in more than you pay out consistently. Well, I’ve got good news and bad news.

The good news is this past Tuesday in Vegas the Vdara Hotel opened with 1,495 deluxe suites. A magnificent structure was unveiled, to be followed by additional magnificent structures, restaurants and shopping that will probably take your breath away. The project’s completion is great for Vegas, creating many new jobs, and I believe tourists will come from all over to experience this changing of the Nevada skyline.

Now here’s the bad news: at a cost that runs into billions, the MGM Corporation had to take in a partner (Dubai World) to complete the project, with the help of additional funds. It turns out that Dubai World has somewhat of a debt of its own, and almost didn’t complete the deal due to their battle with recession. Their pet project is even more unbelievable and they probably have cut off more than they can chew without helping MGM finance CityCenter.

It’s worth mentioning that Dubai World bought into MGM at $80 per share, which now is just over $10 per share. So what we have are 2 giant corporations who are cash poor, trying to recover amid tremendous interest by opening fabulous operations that after 6 months to a year will have difficulty maintaining a cash flow to satisfy their financial obligations.

Worse yet, the government won’t bail them out, as the "too big to fail" rule doesn’t apply. This brings us back to my theory – you have to take in more than you pay out. Period. Feel free to formulate your own opinion. Remember, I flunked algebra.

After my pitiful performance with college football last week I’m elated to say there’s only one college game this week. At this point I don’t know the spread, but I assure you it can’t be high enough for Army to cover. The Navy club looks more impressive this year, and last year they shut out Army 34-0.

The pros lead off with a Thursday night thriller, as the Browns host last year’s world champs, the once mighty Steelers. The home team gets plus 10, and I think the value of Steelers’ safety Polamalu’s availability could be the determining factor. If he plays, you can lay it. If he’s out you can take it. Either way, it will be a low scoring game.

I like the Broncos plus 7 and a half on Sunday, as the Colts have participated in quite a few close games, and they’ll be playing against a good defense. Broncos.

Another key injury is Falcons QB Ryan. If he’s in or out vs. the Saints: I’ll lay 9 and half if he’s out, or take 9 and a half if he isn’t.

The Lions go to Baltimore and are getting plus 12 and a half points. And maybe even more by game time. They are capable of keeping the score closer, as the Ravens don’t score too many themselves. Lions plus 12 and a half.

Seattle gets almost a full TD at Houston, and they are capable of beating the Texans straight up as QB Hasselbeck keeps throwing strikes. Seattle plus 6 and a half.

Have a great week.

Question? Comment? E-mail me at: Sid Diamond