Tuesday, July 19, 2011

The Problem with the US Economy is Obama

Steve Wynn, the Founder, Chairman, and CEO of Wynn Resorts Ltd. tore into President Obama on Monday 18 July 2011 during the company quarterly conference call. What he said explains why the US economy is languishing and why companies are holding on to so much cash and not doing anything with it.

Note that Wynn owns hotels and casinos in Las Vegas and Macau China. The Macau property is currently responsible for more than 2/3 of its revenues and profits. Wynn's quarterly numbers, announced during the conference call, beat estimates by a wide margin.  I bought a chunk of their stock late last week in anticipation of this, based on my son's research on Macau.   Jim Cramer of CNBC calls Wynn Resorts the "best of breed" in the hospitality and gaming market.

Here is what Steve Wynn had to say:
Well, here's our problem.  There are a host of opportunities for expansion in Las Vegas, a host of opportunities to create tens of thousands of jobs in Las Vegas.  I know that I could do 10,000 more myself, and according to the Chamber of Commerce and the Visitors Convention Bureau, if we hired 10,000 employees, it would create another 20,000 additional jobs for a grand total of 30,000.  I believe in Las Vegas.  I think its best days are ahead of it. But I'm afraid to do anything in the current political environment in the United States....

....And I'm saying it bluntly, that this administration is the greatest wet blanket to business, and progress, and job creation in my lifetime. And I can prove it, and I could spend the next 3 hours giving you examples of all of us in this marketplace that are frightened to death about all the new regulations, our healthcare costs escalation, regulations coming from left and right.

A President that seems--that keeps--using that word "redistribution". Well, my customers and the companies that provide the vitality for the hospitality and restaurant industry, in the United States of America, they are frightened of this administration. And it makes you slow down and not invest your money. Everybody complains about how much money is on the side in America. You bet. And until we change the tempo and the conversation from Washington, it's not going to change. And those of us who have business opportunities and the capital to do it are going to sit in fear of the President.

And a lot of people don't want to say that.  They'll say, "Oh God, don't be attacking Obama." Well, this is Obama's deal, and it's Obama that's responsible for this fear in America.  The guy keeps making speeches about "redistribution", and maybe we oughta do something to businesses that don't invest or are holding too much money. We haven't heard that kind of talk except from pure socialists.

Everybody's afraid of the government, and there's no need to soft peddle it.  It's the truth. It is the truth. And that's true of Democratic businessman and Republican businessman, and I am a Democratic businessman and I support Harry Reid.  I support Democrats and Republicans.

And I'm telling you that the business community in this country is frightened to death of the weird political philosophy of the President of the United States.

And until he's gone, everybody's going to be sitting on their thumbs.


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