Wednesday, June 25, 2008

Economic Downturn Viewed To Harm Las Vegas Resort Earnings For At Least Another Year

Feather News

The Wall Street bond rating firm Moody's Investors Service issued a report that said the economic current downturn will be sharper than the period that followed the World Trade Center attack in 2001 and will further dampen earnings for the next 12 to 18 months.

"Las Vegas largely sidestepped trouble by using price discounts to lure skittish travelers," the report said. "Now, with consumers' anxieties centered on their economic well-being, that strategy is unlikely to be as effective. Las Vegas operators are preparing for an extended period of weak demand will have to turn to other levers, such as reduced capital spending or less aggressive financial policies, to hold up through the next year or more."

The report highlighted the popularity of Las Vegas as a destination resort city, "In a nation where vacations are considered a virtual birthright, it seems inevitable that Las Vegas will remain high on the list of tourism hot spots."