Part I: People are dancing in Las Vegas, but there's no music

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05/17/2010

I spent four days in Las Vegas last week attending Medtrade Spring. The show was great, lots of energy, one of the best in years--the town, not so much. Poor Las Vegas. Something is broken. People are dancing but there's no music. The city has lost its mojo.

Here's some stuff about Vegas' current depression that I picked up from various sources, including the 10 or so cab drivers who shuttled me around

- The unemployment rate is about 13%--second only to Michigan.

- A house that sold for $400,000 four years ago is today lucky to fetch $130,000.

- Despite the drop in home values, there's a home building frenzy going on in Vegas. Most people willing pay $130,000 for a home, it seems, prefer new to used. Something weird and wasteful about that.

- The flagging economy and tumbling home values has created a whole new class of adult escort: desperate housewives trying to pick up some extra cash to pay the mortages on those $400,000 homes that today are worth only $130,000. So said the cabbie who drove me to the airport at 4:45 a.m. Friday morning.

- For $37.50, a person could could eat at seven buffets in a single day. What kind of person would want to do that?

- Restaurants are still expensive, but hotel rooms are dirt cheep. My bill for three nights at the Flamingo: $282. An industry acquaintance told me he stayed at a more upscale establishment for $69 a night. Hotels are dropping their prices dramatically/desperately to entice people to visit Vegas.

Tomorrow, I'll talk more specifically about Medtade Spring, where the mood inside the show was much different from that outside on the street. Even with the ax of national competitive bidding poised over the industry's outstretched neck, the show offered plenty of reasons to feel, if not completely optimistic, at least hopeful.

Mike Moran

Comments

Reporting about housewives turning to prostitution to pay the mortgage....Based on cab driver b.s. sories??? Come on!!!
Just got back from Las Vegas myself from a three night stay. Was there 5/9-5/12, and have to say everywhere I went was very busy for "mid-week". I was expecting it to be a ghoat-town...based on the multitude of inaccurate "doom and gloom" reports, such as this one. Mike talks about "the mood on the street"...but I doubt he had any exposure to the "street" outside of the window of his 10 or so cabs.

Dear Steve,

I actually ran 5 miles through the Vegas mean streets early each morning I was there. I got a nice close up of some guy throwing up in the bushes, and there was no shortage of people with creased, beet red faces looking lost and hopeless at 6 am each day. Sure, the restaurants are doing a good business (travelers still spend; I know I did), but the hotels are practically giving away rooms (revenue is way off), and with a 13% unemployment rate, would you expect the mood among the Vegas locals to be anything but a bit sullen? As for housewives turning to the escort business to help pay the bill, well, all I can say is that nothing surprises me any more. Las Vegas is still a good place to do business, but the town--at least this time around and I've been going there for 13 years—seemed worried about the future. Can't say that I blame them.

FYI Cab drivers are people, too, you know.

MM