THE M3: IM/CITI REPORT; LESS TABLES; CHINA LOAN TARGET CUT; IMPORTED WORKERS; BELLE

The Macau Metro Monitor, January 18, 2011


TRAIN TALK MISSES THE STATION Intelligence Macau

IM disagrees with Citigroup's report on the positive effects of the upcoming Guangzhou-Zhuhai intercity railway.  IM says the buses from Guangzhou to Zhuhai will continue to be the main avenue of transportation since 1) It is cheaper; 2) Direct route to Gongbei vs. the multiple stops and transfers on the railway; 3) Railway terminates 45 minutes away from the Gongbei.

 

IM also disagress with Citi's forecast that SJM will lose market share in 2011 and 2012.  IM stresses that 1) SJM has the stickiest customers in Macau, mostly because of the clan-based associations of its 3rd-party casinos; 2) Grand Lisboa is expanding space for more tables; and 3) In contrast to the 5-star rooms being developed for Galaxy Macau and Lots 5&6, SJM has some of the most affordable hotels.

 

VIP BACCARAT ACCOUNTED FOR 72% OF MACAU'S GAMING REVENUES IN 2010 macaubusiness.com

For Q4, Macau had 4,791 gaming tables, a decrease of 47 from Q3.  Slots also fell to 14,050 from 14,316.  For 2010, VIP baccarat grew 69.91% YoY to MOP135.65BN; mass market baccarat rose 36.94% YoY to MOP34.92BN; and slots jumped 32.52% YoY to MOP8.62BN.

 

CHINA CUTS LOAN TARGET; FOREIGN INVESTMENT HITS RECORD Reuters, China Daily

According to sources, China's central bank has reportedly cut its 2011 lending target by 10% to between 7.2 trillion and 7.5 trillion yuan.  New yuan‐denominated lending in China reached 7.95 trillion yuan in 2010. The figure surpassed the central bank's target of 7.5 trillion yuan. 

 

OVER 75,000 IMPORTED WORKERS IN MSAR Macau Daily Times

In November, the number of non-resident workers totaled 75,098, an increase of 318 compared to the previous month.  Mainland China continued to be the main source of imported labor; however, there was a slight decrease of 79 Mainland workers from 41,516 in October to 41,437 in November.


BELLE, LR KEEN ON PAGCOR ASSETS Philippine Daily Inquirer

On the much-anticipated Pagcor privatization, Belle's group leader Willy Ocier said: “We don’t know when that will be, but if and when they do, Belle and LR will obviously be interested in bidding for the casinos outside of Metro Manila and we are eagerly awaiting Pagcor’s terms of reference.”


Did the US Economy Just “Collapse”? "Worst Personal Spending Since 2009"?

This is a brief note written by Hedgeye U.S. Macro analyst Christian Drake on 4/28 dispelling media reporting that “US GDP collapses to 0.7%, the lowest number in three years with the worst personal spending since 2009.”

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7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

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Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

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GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

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Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

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Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

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Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

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People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

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UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

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Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

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Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

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An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

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