GAMBLING

The House Always Wins...Except Against a Global Pandemic

The gambling industry is working on a patchwork plan to reopen after the coronavirus and social distancing measures forced casino closures and kept away patrons. 

It was ugly

At one point this year, all 989 commercial and tribal casinos in the U.S. were shut down. All of them. It's devastated Vegas, but those closures were also a really bad beat for smaller gambling markets.

• Adjusted gaming revenue in north Mississippi fell 36% from February to March, but that doesn't take in the full extent of the damage.
• One region in Mississippi closed seven casinos, leaving a third of employed residents in Tunica County without work. 

With the economic reverberations of casino shutdowns ringing in their ears, officials are eager to move forward with reopenings...with extreme caution:

• “A casino is considered high-risk in terms of contact intensity, volume, and potential for visitors congregating in large groups,” a spokesman for New Orleans Mayor LaToya Cantrell told the WSJ.

So when will they reopen?

It’s kind of a crapshoot. Casinos in the three biggest markets—Nevada, Pennsylvania, and New Jersey—remain closed. But down south…

• Louisiana started to open some casinos on Monday—with a 25% occupancy limit.
• In Mississippi, they can reopen starting today, with a 50% cap. 

Like many other industries, casino operators are faced with a “new normal,” and are experimenting with ways to lure COVID-wary guests back to the slots. Handwashing stations and contact tracing are in while promotional stalwarts like all-you-can-eat buffets might be on their way out. 

• “I think it’s going to be a long time before customers are willing to eat at buffets, where they’re grabbing food from pans that other people have been grabbing food from,” Tom Reeg, CEO of Eldorado Resorts, told the Las Vegas Review-Journal. 

Bottom line: The house is betting cooped up gamblers will return, but with a big uptick in online betting and significant health and safety concerns, it might not have the edge this time. 

RETAIL

Lowe’s Nailed Earnings

Edward vs. Jacob, CHD vs. Barstool, a creative writing degree vs. our parents' expectations—intense rivalries, sure, but no match for the clash of the home improvement titans: Lowe’s and Home Depot. That old feud got a jolt this week when both reported earnings. 

The backstory: Lowe’s has played second fiddle to Home Depot in both market capitalization and revenue, despite being in business 32 years longer and having more store locations.

But Lowe’s is riding high

With people focused on improving the homes they were stuck in, the retailer beat Q1 expectations across the plywood board:

• Same-store sales were up 11%, compared to 6% for Home Depot.
• Net income increased by 28% and gross revenue was up 11%.

What happened? Lowe’s has fewer stores located in cities, which helped it weather the coronavirus storm better than its rival. And it capitalized on the shift to curbside pickup, recording an 80% increase in online sales. 

Reality check: The uncertain future of the housing market means gains in the home improvement sector might be short-lived.

INDUSTRIALS

Michigan Flooding Breaches Dow Plant

Yesterday, the Midland region of Michigan was inundated with flooding that reached nine feet high. 

• As of yesterday evening, the county has evacuated 1,000 people and the city of Midland plans to remove 10,000 more. 

It’s also bad for biz. Located in that region is a cluster of production facilities belonging to Dow, a huge chemicals company, and other industrial firms. Dow said it has activated a flood preparedness plan, and that runoff ponds had filled with floodwaters. It also shut down its HQ in Midland. 

• Those waters could reach Dow’s storage tanks and expose the surrounding area to its chemicals. They could also stir up pollution from a Superfund site (a contaminated area the EPA has designated for cleanup) downriver from the compound. 

What happened: After two days of heavy rain, water from Lake Wixom broke through a dam on Tuesday evening, and then another later that night. 

Bottom line: We’ve been trying to limit our “stone cold bummer” stories, but...this is one. Before the flooding, Michigan was already scrambling to face an especially severe COVID-19 outbreak.

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E-COMMERCE

Facebook Moves from Crush Stalking to Shelf Stocking

Yesterday, Facebook shares climbed 6% and touched an all-time high. 

Why? Having conquered the attention economy, Facebook is gunning for the exchanging products for money economy. On Tuesday, it unveiled Facebook Shops, a new tool that will make it even easier for merchants to list products on Facebook and Instagram than it is to fritter away 3 ½ hours on Facebook and Instagram. 

How it works: Brands can register on Shops to sell products through Facebook and Instagram storefronts, Stories, and ads. Third-party partners like Shopify and Woo will do the heavy lifting handling inventory, orders, and fulfillment. 

• The point, per Retail Brew: "Planting commerce tools in every orifice of its apps could finally train users to see Facebook as a virtual mall."

Wall Street’s reviews are in, and if Shops were a novel, analysts would call it “a stunning, incandescent tour de force.” Deutsche Bank said it could drive as much as $30 billion in revenue, while Morgan Stanley said it could make Facebook an e-comm competitor to Amazon and Google.

INTERNATIONAL

Honk If You Find This Picture Strangely Comforting

Rush hour in Hanoi, Vietnam, Tuesday morning. Remarkably, the country of nearly 100 million people has recorded only 324 coronavirus cases and no deaths. Nonessential businesses such as pubs, theaters, and spas are back in action.

The next step? Getting Vietnam's tourism engine running again: The number of visitors decreased 98% in April than a year before. 

• That's still better than Japan, which welcomed just 2,900 foreign visitors during the entire month of April. That's a 99.9% annual drop. 

JOBS

When One Door Closes...

The coronavirus pandemic obliterated what had been the best labor market in generations, but some quirky new jobs are rising from the ashes.

Soft Drink Dispenser Operations Associate: As part of its guidelines for reopening, McDonald’s is advising stores place attendants at soft drink stations during peak hours, per Bloomberg. Two to three years of experience mixing Coke and Fanta strongly encouraged. 

Assistant to the Regional Manager of Pandemic Containing: States are hiring thousands of contact tracers—workers who call people who’ve been in close contact with someone who recently tested positive for COVID-19.

Junior Button Pusher: JPMorgan said it might designate workers to push elevator buttons in its offices to prevent unnecessary contact with germy objects. The company expects offices to remain half full for the “foreseeable future,” per Bloomberg.

SVP, Division of Getting Turned Up: On Monday, Sara’s Market On the Go became Los Angeles’s first liquor store on wheels, L.A. Taco reports. The owners took advantage of relaxed regulations to turn their brick-and-mortar location into a tricked-out van that can start a party in any neighborhood at any time.

WHAT ELSE IS BREWING

• Target said online sales grew 141% last quarter. Think about that for a second…
• U.S. authorities arrested a former Green Beret and his son for allegedly helping Carlos Ghosn, the former chairman of Nissan, escape from Japan last December.
• Hulu is rolling out a major redesign.
• Apple and Google released the software that will power contact tracing apps in at least 22 countries and some U.S. states.
• VW apologized for an Instagram ad for its Golf vehicle, admitting the spot was racist and insulting.

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Three photo collections to scroll through during your next coffee break:

• Dogs travel in a pack, flamingos flock in a flamboyance
• The best images of NYC during COVID-19, crowdsourced
• A peek inside a vanishing Asia

Behind-the-scenes in the retail industry: Retail Brew surveyed 1,200 readers about their experiences navigating the crisis in one of the hardest hit sectors. Check out the responses.

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FROM THE CREW

Brew's Bookshelf

Every other Thursday, we'll bring you some must-have books for your summer reading list. 

• Inside Story: Red Card by Ken Bensinger traces one of the most sensational stories of power and corruption in the 21st century: the FIFA scandal. 
• Econ: Good Economics for Hard Times by Nobel Prize-winning pair Abhijit Banerjee and Esther Duflo was one of Bill Gates’s 13 summer reading recs. 
• History: The Billionaire Raj: A Journey Through India’s New Gilded Age is James Crabtree’s exploration of the rise of India’s billionaire class, inequality, and the forces that challenge the world’s largest democracy. 

Want to submit your own book recommendation?

GEEK SQUAD TRIVIA

Do not look down, keep your eyes up here. 

Can you name the symbols that accompany the 1, 2, 3, 4,...0 keys at the top of your keyboard?

GEEK SQUAD TRIVIA ANSWER

1!, 2@, 3#, 4$, 5%, 6^, 7&, 8*, 9(, 0)