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Politics : High Tolerance Plasticity -- Ignore unavailable to you. Want to Upgrade?

To: Don England who wrote (844)	3/2/2001 2:51:22 PM
From: excardog	Respond to of 23153

Somebody mention gaming stock recently? Thursday March 1, 4:46 pm Eastern Time Nevada casinos face 25 pct hike in power costs By Doug Young LOS ANGELES, March 1 (Reuters) - Electricity price hikes in Nevada that took effect on Thursday will raise casino power costs 20 percent or more, wreaking a material effect on earnings in 2001, casino operators and analysts said. Nevada's major utilities raised electricity rates by 17.6 percent for most customers on Thursday, but the hikes for major users like the state's big casinos are being hiked even more, said Glenn Schaeffer, chief financial officer of Mandalay Resort Group (NYSE:MBG - news), one of Nevada's biggest casino operators. ``Typically in the hotel industry about 10 percent of operating cost is power,'' Schaeffer said. ``Off the base we had a year ago, I think you can expect (electricity costs for Mandalay's Nevada casinos to be) 25 percent or higher year-over-year.'' Schaeffer said the higher power rates will have a ``negative'' effect on earnings, but added it is still too early to determine the actual impact. He said it is also too early to say if Mandalay, whose Las Vegas properties include Mandalay Bay, Circus Circus and Luxor, will raise room rates or add room surcharges to try to recoup some of the cost increases. Regardless of higher costs, however, the company will not resort to major conservation measures like some companies in California and other parts of the West have done where rates have risen, Schaeffer said. ``People come to Las Vegas because we're in the bright lights business,'' Schaeffer said. ``We have to have rooms at the right temperature whether it's winter or summer.'' Marc Mutkoski, an analyst at Deutsche Banc Alex. Brown, predicted that most casino operators will see a 25-30 percent increase in their power costs. Assuming a 25 percent increase, he predicted that Mandalay -- which has the biggest exposure in Nevada -- will take the largest hit of $12 million in added costs, which would lop about 10 cents per share off its 2001 earnings. He predicted MGM Mirage (NYSE:MGG - news) would take a hit of about $11.5 million or 4 cents per share, followed by Park Place Entertainment Corp. (NYSE:PPE - news) with additional costs of $10 million or 2 cents a share and Harrah's Entertainment Inc. (NYSE:HET - news) with a hit of $4.2 million or 2 cents a share. ``While the financial impact of higher energy costs at the company level does not appear to be dramatic as a stand-alone issue, it could be very significant in the context of a slowing economy and sluggish top-line growth environment,'' Mutkoski wrote in a research note. Jason Ader, an analyst at Bear Stearns, estimated a 20-25 percent rate increase will cost MGM Mirage and Mandalay 3 to 5 cents each in annual earnings per share. He added that higher energy prices could also hurt casino companies by reducing leisure travel to Las Vegas. ``The city has the potential of getting hit on both sides -- the indirect effect of rising fuel prices negatively impacting leisure consumption as well as the direct impact of operating expense being higher,'' he said. The final effect of price hikes is still up in the air, since the approved rate increases could be temporarily reversed as early as Friday when a judge will rule on a preliminary injunction to stop the measure.

To: Don England who wrote (844)	3/2/2001 2:55:51 PM
From: Think4Yourself	Respond to of 23153

Guess I'm lucky my brokers don't know about or at least don't enforce that rule. They only require funds be present at the time of purchase or that a sale providing sufficient funds has executed. Think I'll be more careful in the future, just in case.

To: Don England who wrote (844)	3/2/2001 10:03:55 PM
From: JungleInvestor	Read Replies (2) \| Respond to of 23153

Don, when I transferred my accounts from Waterhouse (who must be the worst brokerage firm in existence) to Dreyfus, I ran into a similar problem with my IRA's. I sold a stock and then the next day tried to buy another stock with the proceeds from the prior day's sale. Dreyfus would not let me do it because they had just implemented restrictions based on a new SEC rule that prohibits day trading in an IRA. They said that I could have bought the stock on the same day I sold the other one, if, however, this is not done then I need to wait until the settlement date to use the proceeds to buy another stock. This obviously can be limiting sometimes and forces one to either buy right away or tie up the funds for three days. Waterhouse had not implemented this new rule at the time I left.