We here at Getminted realise that our members are of an intellectually superior ilk and so Newton's law of motion which states "Every action has an equal and opposite reaction" will be one you understand.
Using the law though in relation to the current economic downturn in the United States we start to wonder if the recession there could spell bad news for the gambling sector on this side of the Atlantic.
According to a recent report in the US the poor economic situation is increasing the potential for negative rating actions in the American gaming sector as the negative impacts to casino gaming revenues begin to take their toll.
It states that the negative rating actions for the American gaming sector are expected to significantly exceed the positive this year with eleven US gaming issuers currently on review for possible rating downgrades with six having a negative outlook. It said that, combined, these issuers account for almost one-quarter of the total number of rated American gaming issuers.
Moody's who carried out the report said that the declining disposable income of potential customers along with increasing travel costs are lowering overall visitor numbers and spend per visit in many gaming markets.
"Further, many markets are relatively new with little-documented history to indicate how they will perform during a period of prolonged economic weakness," read the report from Moody's.
It stated that this slowdown along with the possibility of a recession sit alongside fierce competition among gaming jurisdictions requiring firms to spend on promotion and investment.
"Decreased access to capital is also likely to result in the cancellation or delay of development projects, which could hurt longer-term revenue and cash flow growth rates," read the release from Moody's.
In Britain, gambling firms who have already parted with thousands of pounds in advertising and marketing revenues, will be keeping their collective fingers crossed that the economy can ride the wave of recession moving here ominously from the States.
These are testing times for the British economy and as a result the British online gaming industry. Only time will tell if we get through it unscathed.
