The meteoric fall of Atlantic City

ATLANTIC CITY, N.J. – Four years ago, some Atlantic City casino customers were shelling out $1,000 for a brownie sprinkled with edible gold dust in a Baccarat crystal they could take home.

Nowadays, some wait until 11 p.m. to eat so they can get a steak dinner for $2.99.

At the beginning of 2007, Atlantic City's 11 casinos were at the top of a wave of prosperity. Starting with the 1978 opening of Resorts, the nation's first casino outside Nevada, Atlantic City for years was the only place to play slots, cards, dice or roulette in the eastern half of the United States. The cash kept pouring in, the busloads of visitors kept coming and the revenue charts went one way: straight up.

And then, they didn't. Now, battered by competition from casinos all around it, Atlantic City is in a fight for its very survival.

The resort is furiously trying to remake itself into a vacation destination that happens to have gambling, but with no guarantee it has a winning hand even as other threats loom, including the possible expansion of casinos to north Jersey racetracks and a growing push for online gambling.

Intoxicated by years of success, Atlantic City missed numerous opportunities to diversify its offerings, widen its customer base and fend off competition that clearly was on its way even 20 years ago.

"The atmosphere was a total irrational exuberance; it truly was," said Robert Griffin, CEO of Trump Entertainment Resorts, who worked at Trump properties here in the 1980s and 1990s. "There was a feeling that there was no end to the good times and that the money would never end."

Then, disaster struck the nation's second-largest gambling market. A perfect storm of competition right on its doorstep in Pennsylvania, New York and Delaware, coupled with the recession, pummeled Atlantic City worse than any other casino market. In four years, a billion and a half dollars vanished, along with thousands of jobs and tourists. Pennsylvania, with its 10 casinos, is poised to knock Atlantic City into third place at some point next year.

How did things go so wrong so fast?

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Cars streamed into Atlantic City on May 26, 1978, and people lined the Boardwalk for blocks, waiting to get inside Resorts on the first day it was legal to gamble there.

People bought tickets for buffets they had no intention of eating, just to sneak inside the casino earlier than the rest. Men relieved themselves into plastic coin cups to avoid losing their spot at the tables by going to restrooms. And cash — more than anyone had ever seen and more than management could imagine — flooded into the counting room, to the point that it took nearly an entire day to count it.

"It was euphoria," said Steve Norton, who was Resorts' executive vice president when it opened and now runs a casino consulting firm in Indiana. "I mean, it was an unbelievable time."

One after another in the 1980s, casinos kept coming. Revenues reached a high point of $5.2 billion in 2006.

And then the Pocono Downs harness racing track in Luzerne County, Pa., added slot machines and opened them to the public on Nov. 14, 2006. Suddenly, people in the heart of one of Atlantic City's key feeder markets could drive 10 or 20 minutes to play the slots instead of making a three-hour round trip to Atlantic City. In less than four years, there would be 10 casinos in Pennsylvania, all of which now offer table games, too.

They took in nearly $2.5 billion last year, approaching Atlantic City's $3.6 billion. So far this year, they are running neck-and-neck: $996 million for Pennsylvania, and $1.1 billion for Atlantic City.

"If you didn't anticipate this competition coming, you were asleep at the wheel," said Israel Posner, executive director of the Lloyd Levenson Institute of Gaming at Richard Stockton College of New Jersey.

David Schwartz, director of the University of Nevada-Las Vegas Center for Gaming Research, said Atlantic City can be successful again, "but it's going to require a reinvention."

"Basically, the city needs to stop looking backward and start looking ahead," he said.

A look back reveals many missteps and lost opportunities. The most obvious: a failure to reinvent the resort as a place to go for more than gambling. Atlantic City belatedly jumped on the bandwagon, adding non-gambling amenities over the past eight years like celebrity restaurants, spas, shopping and top-name entertainment. The Borgata even built a stand-alone luxury hotel called the Water Club, and Harrah's indoor pool has become a cash cow, doubling as one of the city's hottest nightspots.

But back then, anything customers couldn't bet on was seen as a waste of money.

"Nobody wanted to build anything other than casinos," Norton said. "The property values shot up so high, it didn't make sense to build anything else."

There's plenty of blame to go around. Casino owners focused only on their own properties instead of the market as a whole, a habit that Atlantic City is only recently shaking off. Competing against each other instead of Las Vegas was the city's playbook for decades.

Now, the casinos are banding together for joint marketing efforts, and will chip in to help sponsor the biggest names in entertainment, rather than letting one casino pay the whole cost of a Britney Spears or Lady Gaga show, or a rodeo. And three casinos are even thinking of jointly funding a new convention or trade show center in Atlantic City to draw badly needed midweek business.

New Jersey also erred by failing to approve legalized sports betting in 1991 when it was given the chance to do so ahead of a nationwide ban, gambling experts say. A state senator sued the federal government in 2009 to overturn the Professional and Amateur Sports Protection Act, but the suit was dismissed by a federal judge last month.

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When Griffin, the Trump CEO, lays his head on the pillow at night, he worries that New Jersey will one day succumb to political pressure from lawmakers in the more populous northern part of the state to expand casino gambling to the Meadowlands racetrack, 10 minutes from New York City. Analysts expect it would instantly become a $1 billion market. State law now allows casino gambling only in Atlantic City.

"That would devastate us," he said. "This would become a two-casino town; it wouldn't even take five years. That's what keeps me up at night."

Maddie Downey, a bartender at the Showboat, has her own worries. The single mom has already lost one casino job when the Sands closed in 2006, and worries that gas prices will stay near $4 a gallon, keeping people away from Atlantic City.

"I'm just glad to have this job," she said. "I just hope it doesn't get any worse, and I hope the price of gas comes down."

When the Indian-run Foxwoods casino opened in Connecticut in 1992, it was the closest casino to Atlantic City — and a sure sign that more were to come. Mohegan Sun, another tribal casino, opened in Connecticut four years later. The resort responded by allowing its casinos to stay open 24 hours a day; they formerly had to close for a few hours in the wee hours of the morning. It also introduced new games like poker, keno and racing simulcasts.

But the money kept coming in, and the two Connecticut casinos didn't prove to be a major problem for Atlantic City, which sat on its cards. No new casinos opened until the Borgata in 2003, which would usher in a new era of grand dreams — very few of which would ever come true.

The Borgata touched off a casino arms race, with companies from across the country vying to build the next mega-resort here. At the start of 2008, there were plans for as many as four new casinos; MGM Mirage unveiled a $5 billion, three-tower casino project that would have been the largest ever built here.

Pinnacle Entertainment blew up the Sands to make way for its own $2 billion casino resort, modeled on a beach house. Before setting off the explosives that would bring it down, then-CEO Dan Lee spoke of the importance of keeping the market fresh, new and exciting. The challenge, he said, is "to compete in this new world, or be the next implosion."

Yet by the end of 2008, Pinnacle and MGM's projects imploded on their own, and Revel, the first of the new projects to actually put shovels in the ground, was limping along. It would run out of money in 2009 and halt construction on the interior. Morgan Stanley, its major financer, walked away from the project, deciding it was better to take a nearly $1 billion bath on the deal than to stay in Atlantic City.

After scouring the globe for financing, including asking the Chinese government, Revel CEO Kevin DeSanctis finally secured new financing in February 2011 that allowed the project to resume, with some state tax incentives.

"Every market got hit, but nobody faced the amount of new competition coming online as much as Atlantic City did," said Larry Mullin, who was president of the Borgata at the time and now runs an Australian casino company. "We were just exposed. Nothing was going to stop the convenience customer from trying a product that was closer to them. I just don't think there was any silver, magic bullet. It was a very tough situation."

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Torn between demands from the New Jersey casino and horse racing industries, New Jersey's incoming governor, Republican Chris Christie, sided in 2010 with the casinos, which provided more tax revenue to the state's coffers. He refused to allow slot machines at the racetracks — something the racing industry has long wanted to keep pace with its competitors in other states.

New Jersey staged a quasi-takeover of Atlantic City's casino and tourist zones; Christie called it "a partnership." But the new tourism zone is run by the state and takes charge of many functions Atlantic City's often dysfunctional municipal government had long struggled with, including safety, cleanliness and economic development. (At one point just a few years ago, four of the previous eight mayors of Atlantic City had been arrested on corruption charges.)

The $30 million in annual payments that the casinos had to pony up to the horse racing industry, in return for keeping slots out of the tracks, will now be used to market Atlantic City nationally. The state rewrote many of its famously strict regulations for casinos, removing, among other things, minimum staffing requirements. They even allowed casinos to keep some jackpots that had built up on progressive slot machine games that they decide to cancel.

State-mandated economic redevelopment funds collected from each casino will now be used solely for projects within Atlantic City; before, the money was spread around the state.

The help cannot come too soon. Casinos are selling at fire-sale prices. Within the past year, The Tropicana, Resorts and Trump Marina have all sold for about 10 cents on the dollar from their values of just a few years ago. The Atlantic City Hilton stopped paying its mortgage in 2009 and is looking for a buyer. The casinos have shed nearly 15,000 jobs since 1997, with more layoffs to come.

Pyramid's secret chamber electrifies Web

Are the glory days of the archaeologist over? Has everything cool and ancient already been discovered? Nope. Thanks to ever-improving technology, several new findings have electrified the Web.

A robot explorer recently discovered ancient markings at the Great Pyramid of Giza in Egypt. The robotic device found the markings inside a secret chamber inaccessible to humans--and then proceeded to film the painted hieroglyphics and stone markings, which hadn't been seen by human eyes in 4,500 years, via a small robotic camera that was fit through a tiny hole in a stone wall.

It is too soon to tell what the markings mean, but experts are hoping they may shed some light on why the ancient Egyptians originally built the tunnels. An article from CNN explains that the tunnel is "one of several mysterious passages leading from the larger king's and queen's chambers."

This wasn't the first time a robot explored the passageways--but it was the first time a robot could focus on details on the walls. This breakthrough occurred thanks to a new kind of micro-camera that can be bent side-to-side instead of just focusing straight ahead.

News of the discovery quickly took the Web by storm. Over the past 24 hours, Web searches for "great pyramid of giza" and "egypt pyramids" both spiked into breakout status. Also seeing big bumps in lookups: "hieroglyphic dictionary" and "hieroglyphic meanings."

Meanwhile, other technologically enhanced discovery expeditions have turn up other fascinating new information about the pyramids in recent days. Archaeologists from the United States (with some help from the BBC) used satellite imagery to discover 17 pyramids beneath the sand and silt in Egypt. An article from Canada's CBC explains that 1,000 tombs and around 3,000 other buildings were also discovered thanks to the technology.

How does the satellite-mapping work? According to the CBC, "kiln-fired bricks used to build ancient cities can be distinguished from the earth covering it" on the infrared satellite images. This find may be just the tip of the iceberg, so to speak. There may be many more buildings, tombs and pyramids buried further beneath the Earth's surface.

Grown-up roles for original 'Spy Kids'

This one has a new crew of kids along with Jessica Alba and Joel McHale. It also features a return of the original main characters -- Carmen and Juni Cortez (Alexa Vega and Daryl Sabara) -- only they aren't kids anymore. Call them Spy Young Adults.

In the first movie -- which came out way back in 2001 -- Carmen and Juni had no clue that their seemingly dull parents (played by Antonio Banderas and Carla Gugino) were actually semiretired members of the Organization of Super Spies. They quickly learned the truth, needless to say, and soon were members of the OSS themselves.

Since the last "Spy Kids" movie came out in 2003, Daryl Sabara and Alexa Vega have been quietly building their grown-up movie careers. Daryl has appeared in episodes of "Weeds" and "Criminal Minds," and he's set to play a major role in the upcoming sci-fi spectacular "John Carter of Mars."

Alexa Vega starred in "Repo! The Genetic Opera" alongside Paris Hilton, and this year she was the lead in the comedy "From Prada to Nada" opposite Camilla Belle and Wilmer Valderrama. She also recently married producer Sean Covel. The Spy Kids have indeed grown up.

Naomi Campbell shocked by 'racist' ad

A new ad for Cadbury chocolate is leaving a bitter taste with Naomi Campbell. The supermodel is looking at "every option available," including legal action, in response to a promotion that compares the celebrity to a Dairy Milk Bliss bar.

The ad reads, "Move over Naomi, there's a new diva in town," and shows the candy bar nestled in diamonds. The campaign ran in supermarkets and newspapers in the U.K.

Campbell told the U.K. newspaper the Independent, "I am shocked. It's upsetting to be described as chocolate, not just for me, but for all black women and black people. I do not find any humor in this. It is insulting and hurtful."

The star, who has been the center of controversies in the past (forced community service for hurling a cellphone at her maid comes to mind), is this time being backed by the British organization Operation Black Vote. The group called on the U.S. company Kraft, which owns Cadbury, to apologize and is considering a boycott of the company's products. Worse, Naomi's mom is mad.

Here's the ad in question. The campaign ran in supermarkets and newspapers in the U.K.

Valerie Morris told the Independent, "I'm deeply upset by this racist advert. Do these people think they can insult black people and we just take it? This is the 21st century, not the 1950s. Shame on Cadbury."

Cadbury said in a statement that it had pulled the billboards with no plans to repeat the ad, and added, "It was certainly never our intention to cause any offense, and the campaign itself is a light-hearted take on the social pretensions of Cadbury Dairy Milk Bliss."

Scientists discover why Vikings vanished

OSLO (Reuters) – A cold snap in Greenland in the 12th century may help explain why Viking settlers vanished from the island, scientists said on Monday.

The report, reconstructing temperatures by examining lake sediment cores in west Greenland dating back 5,600 years, also indicated that earlier, pre-historic settlers also had to contend with vicious swings in climate on icy Greenland.

"Climate played (a) big role in Vikings' disappearance from Greenland," Brown University in the United States said in a statement of a finding that average temperatures plunged 4 degrees Celsius (7F) in 80 years from about 1100.

Such a shift is roughly the equivalent of the current average temperatures in Edinburgh, Scotland, tumbling to match those in Reykjavik, Iceland. It would be a huge setback to crop and livestock production.

"There is a definite cooling trend in the region right before the Norse disappear," said William D'Andrea of Brown University, the lead author of the study in the U.S. journal Proceedings of the National Academy of Sciences.

Researchers have scant written or archaeological records to figure out why Viking settlers abandoned colonies on the western side of the island in the mid-1300s and the eastern side in the early 1400s.

Conflicts with indigenous Inuit, a search for better hunting grounds, economic stresses and natural swings in climate, perhaps caused by shifts in the sun's output or volcanic eruptions, could all be factors.

LITTLE ICE AGE

Scientists have previously suspected that a cooling toward a "Little Ice Age" from the 1400s gradually shortened growing seasons and added to sea ice that hampered sailing links with Iceland or the Nordic nations.

The study, by scientists in the United States and Britain, added the previously unknown 12th century temperature plunge as a possible trigger for the colonies' demise. Vikings arrived in Greenland in the 980s, during a warm period like the present.

"You have an interval when the summers are long and balmy and you build up the size of your farm, and then suddenly year after year, you go into this cooling trend, and the summers are getting shorter and colder and you can't make as much hay," D'Andrea said.

11 foods that can help you lose weight

Hold this thought: To lose weight effectively and permanently, you need to eat. And eat smart. Happily, nature designed a lot of delicious edibles to turn up your fat-burning furnace, flatten your belly, and take a big bite out of your appetite. Here are 11 of the get-slim food gems we're talking about.

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Rice with Veggies

Adding some high-fiber vegetables like broccoli, carrots, and kale to your rice will obviously help lower the calorie count. But not only that. Adding veggies to rice at lunchtime appears to slow stomach emptying, according to research. The end result? You feel full longer. In fact, people in a study ate much less at dinner when they added veggies to their rice at lunch.

All options open in cyber-attack: Pentagon

WASHINGTON: The Pentagon said Tuesday that it would consider all options if the United States were hit by a cyber-attack as it develops the first military guidelines for the age of Internet warfare.

President Barack Obama's administration has been formalizing rules on cyberspace amid growing concern about the reach of hackers. Major defense contractor Lockheed Martin said it repelled a major cyber-assault a week ago.

The White House on May 16 unveiled an international strategy on cyber-security which said the United States "will respond to hostile acts in cyberspace as we would to any other threat to our country."

"We reserve the right to use all necessary means -- diplomatic, informational, military, and economic -- as appropriate and consistent with applicable international law, in order to defend our nation, our allies, our partners and our interests," the strategy said.

Pentagon spokesman Colonel Dave Lapan said Tuesday that the White House policy did not rule out a military response to a cyber-attack.

"A response to a cyber incident or attack on the US would not necessarily be a cyber response," Lapan told reporters. "All appropriate options would be on the table if we were attacked, be it cyber."

Lapan said that the Pentagon was drawing up an accompanying cyber defense strategy which would be ready in two to three weeks.

The Wall Street Journal, citing three officials who said they had seen the document, reported Tuesday that the strategy would classify major cyber-attacks as acts of war, paving the way for possible military retaliation.

The newspaper said that the strategy was intended in part as a warning to foes that may try to sabotage the US electricity grid, subways or pipelines.

"If you shut down our power grid, maybe we will put a missile down one of your smokestacks," it quoted a military official as saying.