High-End Nature Could Hurt Las Vegas Deeply

Casino LifestyleHigh-End Nature Could Hurt Las Vegas Deeply

The city of Las Vegas is no stranger to hangovers, in either the financial or the alcoholic sense. Walking down the Strip at 3 in the morning will show you that many people end up stumbling home after a night of drinking and going to the history books will show you that Las Vegas has had to suffer through economic downturns before. The greatest myth of the United States system of economy is that the city of Las Vegas is somehow immune to the effects of an economic downturn and while there is some truth to that in the sense that Las Vegas has a higher resistance level to economic downturn than many of the other cities in the country, the simple truth of the matter is that it is no more immune to a financial catastrophe than it is immune to a medical one. For this reason, the city of Las Vegas has had experience in dealing with financial downturns and because of that many people have argued that this downturn is no different from all of the others in the eyes of the city of Las Vegas.

However, there is one major problem that this downturn has that none of the other ones ever did. And most people would guess that the major problem this downturn has is the sheer size of it as that would seem like the most likely place to start. After all, all of the analysts say that it was really just 1929 that could match up in size and scope to this particular Las Vegas downturn and for that reason this downturn has major problems that all but one of the other ones did not have. That might seem like a reasonable place to go and a logical place to start the analysis, but the truth of the matter is that Las Vegas has had worse economic downturns affecting them regionally than the one at the current moment in time is doing right now. So the size and scope of the downturn is not the problem. Rather, what is the problem instead is that Las Vegas does not have a clear road to recovery from the current downturn it happens to be in.

How is this possible? It shouldn’t be possible at all if you consider the massive sources of revenue that Las Vegas is supposed to have at the current moment in time, but the dirty secret of the city of Las Vegas is that their revenue streams have been slowly drying up. People that live in Las Vegas and people that visit the city at regular intervals will both say that the strip has become so high end in terms of the services that it offers that the expenses they have to pay in order to stay at a hotel on the strip have simply become too high for them to bear. One economist has rightly pointed out that while people may want all of the high end amenities that come with Las Vegas, the real question that these resorts should be asking is whether people are willing to actually pay more in order to get more. For most people in an economic downturn, the answer is an emphatic no.

July 13, 2011 by : posted in Las Vegas News No Comments