Ponzi?

From Wikipedia: The definition of a Ponzi Scheme:

“A Ponzi scheme is a fraudulent investment operation that pays returns to separate investors from their own money or money paid by subsequent investors, rather than from any actual profit earned.”

From Harrah’s press release today: (emphasis mine)

“Harrah’s Entertainment, the beleaguered casino operator, says it will offer $720 million in new secured notes to give it more time to repay lenders, The Associated Press reported. The Las Vegas-based company, which was acquired in a leveraged buyout, said Tuesday that it would use the proceeds from selling the new notes, which will be due 2017, to repay debt that is due much sooner.”

I’m just sayin’…. I guess if your profits from lowering payouts on the blackjack tables to 6:5 don’t cut it, you just sell new debt to pay down the old debt, then sit back and wait for time to heal all wounds. I’m sure that once CityCenter and Fountainebleau open, flooding Vegas with more supply it can’t handle, then everything will magically become super again.

/sarcasm

-KD

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