Rumor's are flying that Barnett is in serious financial trouble. Now we get confirmation that the Mohegan Tribe's stock and credit ratings are getting blasted.
There's certainly an element of karma here. Using intimidation, racist rhetoric, threats and the like relied on to date by Barnett, Harju, et al as a business model doesn't work all that well.
Nor does election corruption, attempts to buy friendly governments, nuking elections with massive cash infusions to casino-friendly candidates, restraining orders or sexual harassment.
Had Barnett's efforts been transparent, honest, and community friendly, there might have been a way or ways to avoid all of this. But you're not going to get your way by hammering people. People don't respond well to these kinds of tactics. And the Mohegan Tribe would be best served by cutting their losses and getting out now.
And as a suggestion, I think the Mohegans would be best served by expanding their empire to locations that desire that expansion. I also think they ought to check out their partners first. You never know what you might find if you run a records check before you start doing business.
Associated Press 11.19.08, 03:40 PM ESTMoody's downgrades Native American casino debt
Moody's Investors Service on Wednesday cut credit ratings on $2.2 billion of collective debt issued by two Native American casino companies, citing a downturn in gambling revenue.
The credit rating agency lowered Mohegan Tribal Gaming Authority's corporate family rating and probability default rating to 'B1' from 'Ba2.' The 'B1' rating is assigned to securities that "lack characteristics of a desirable investment," Moody's (nyse: MCO - news - people ) said.
Moody's also cut Mohegan's $971.4 million senior subordinated notes to 'B3' from 'Ba3' and its $250 million senior notes to 'Ba3' from 'Ba1.' The rating agency assigned a 'stable' rating outlook.
Moody's said negative gaming trends in Connecticut and "significant" dividends paid to the Mohegan Tribe will hamper the company from lowering the debt-to-earnings ratio in the near-term consistent with a 'Ba2' rating.
Mohegan operates the Mohegan Sun casino near Uncasville, Conn., and the Mohegan Sun at Pocono Downs in Plains Township, Pa.
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MCO $15.82 +0.19
Separately, Moody's downgraded the ratings for Mashantucket (Western) Pequot Tribal Nation and its special revenue obligation bonds from investment grade to junk - to 'Ba1' from 'Baa3.' It assigned a 'Ba2' corporate family rating and 'Ba2' probability of default rating as the company's ratings fell into junk status. The ratings outlook is negative.
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