Online gambling's chips are down
SCOTT JAGOW: The internet gambling industry is reeling this morning. This weekend, Congress delivered a knockout blow: A bill that would make it virtually impossible for Americans to place bets online.London has become the headquarters for many of these poker and gaming sites. Today in London, shares of Internet gambling firms plunged up to 60 percent. More now from Stephen Beard.
STEPHEN BEARD: The crackdown was hardly unexpected. After all, the bosses of two Internet betting firms were arrested in recent months while visiting the U.S. But the timing and ferocity of the latest onslaught is a surprise.
Over the weekend Congress passed an amendment making it illegal for banks and credit card companies to process online gaming payments from the U.S. That will effectively cut the Internet betting firms off from their biggest market. David Buik of Cantor Index says there's little doubt the bill will become law:
DAVID BUIK: It seems unlikely with the midterm elections due — which the Republicans are looking for things to nail their flag to the mast on — that this will not be anything else but supported by President Bush.
He says that Internet betting, which has grown into a mulitbillion-dollar business over the past decade, now has little choice but to look for new customers in Europe and Asia.
In London this is Stephen Beard for Marketplace.
JAGOW: The Vegas casinos would love to see online gambling go away. Harrah's is one of them. Its stock has dropped. It's $10 million in debt. But the Wall Street Journal says Harrah's could be sold this week.Some private equity firms are eyeing one be the biggest leveraged buyouts in history.
Harrahs owns 39 casinos including Caesar's Palace.