A drama of the cans and cannots will play out in the Las Vegas next year, predicted lawyer Jeffrey Silver, a Gordon Silver shareholder, former gaming regulator and former Strip casino executive.
"Those who 'can,' 'will,'" Silver said in a Wednesday e-mail. "(They will) take advantage of strategic repositioning of our economy."
However, he said, "Those who can't will be fortunate to keep their grasp on the dock while waiting for a rising tide. Unfortunately, the Las Vegas economy has as its base the dock-huggers."
Silver is typical among executives interviewed last week about the prospects for the New Year. They generally expect mixed results for the Las Vegas economy and a slow recovery from the worst recession in a generation.
"We don't expect a big rebound now, but we are cautiously optimistic that we will see some gradual and slow improvement," Nevada Federal Credit Union Chief Executive Officer Bradley Beal said.
Small upticks in taxable sales numbers, gaming numbers, home sales and convention business are encouraging, Beal said.
Carole Vilardo, president of the Nevada Taxpayers Association, also expects "slow growth." Drags on the economy, she said, include the recession's severity, uncertainties about the size of state and local tax burdens and possibly higher costs under the national health care program.
Vilardo said business leaders tell her they won't go "hog wild" hiring people if something could arise to affect their companies' expenses.
"We're positive. We feel things will get better," Vilardo said, summarizing the consensus. "But, if we err, it's going to be on the side of caution to make sure that what we do is sustainable."
Randy Garcia, founder and CEO of the Investment Counsel Co., had a bleaker outlook.
"The future standard of living for many workers in Southern Nevada may be at risk," Garcia said in an e-mail. "Employers have little incentive to raise workers' wages, knowing that the large numbers of unemployed are all too willing to accept employment at salaries below those currently employed."
He noted that Nevada leads the nation with 14.3 percent unemployment and wondered how much employers will cut wages and benefits as they struggle to remain profitable and solvent.
Tisha Black Chernine, a real estate attorney and founding partner of Black & Lobello, also took a somber view.
"(2011) I hope, (will be) a very difficult year," she said, "because I'm hoping we are addressing our problems, instead of finding quick fixes or happy little solutions (that don't work).
"We can do nothing other than work our way out of these problems. We can't wait for politicians to do it."
To avoid home foreclosures, she argued, lenders should reduce the principal owed on residential mortgages that are underwater, or owe more than the homes are worth, by 50 percent or more.
About 20,000 homes were foreclosed in Clark County in 2010.
"And that's just the tip of the iceberg," she said. "Foreclosure begets foreclosure, which is a death spiral on real estate prices."
Meanwhile, Las Vegas residents are moving away to find jobs, she said.
Softening demand and a housing-supply glut portend lower home prices next year, she said.
Commercial real estate mortgagors will fare better, she said, because commercial borrowers have direct communication with lenders, including local independent banks. By contrast, she said, residential homeowners must deal with middlemen who have different incentives than the investors who own the debt.
Rob Davenport, managing director of United Capital of Las Vegas, forecast continued improvement in the Las Vegas economy. He pointed out that hotel occupancy here runs 81 percent, about 20 percent higher than the national rate.
However, he said the worst recession in his lifetime has taken a toll on small-business owners, who come to him for investment guidance. Davenport encourages survivors to hold on and wait for the recovery.
"The economists and analysts are calling for a improvement. I see slower, much more moderate growth," Davenport said. "People are spending less money. They're being more cautious and being more conservative about their discretionary spending."
Gaming veteran Silver expects better times for casino operators.
"People are anxious to resume a happier lifestyle," he said. "They will still be coming to Las Vegas. Only this time it will be for a planned respite rather than the impulse buy."
Contact reporter John G. Edwards at jedwards@reviewjournal.com or 702-383-0420.
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