View Full Version : Online gambling banned in the USA

Mr Lexx
2nd Oct 2006, 10:44
Hmmmmm, it seems that the bubble might well have burst. Good to see that leglislation passed in the USA still affects European companies as well! (Partygaming, owner of 888.com and partypoker.com have lost 59% of their share value overnight)


EDIT: Online gambling hasn't been banned. The processing of payments to the online gambling sites has been banned (so the effect is much the same).

2nd Oct 2006, 10:47
Good move USA - now where's our lot? - cloning cards is illegal, but exploiting the gambling weakness to the same eefect isn't - at least in the UK at present.

Casinos do exist over here but are very heavily regulated and supervised - why should internet trading not be likewise?

2nd Oct 2006, 10:53
Hmmm, Radio Caroline all over again, perhaps. How far offshore does the partypoker server have to be to be outside territorial waters and the reach of US legislation?

History teaches us nothing, it seems. Do-gooders of all stripes have constantly tried and constantly failed to ban alcohol, drugs, prostitution, and gambling. This time they will find the internet is an even more elusive and unstoppable target.

Mr Lexx
2nd Oct 2006, 10:56
Binos. It doesn't matter where the servers are based. The credit card companies and banks cannot process payments to the gambling websites. The obvious way to get round it is to have a bank account with a bank outside of the control of the US authorities and transfer money to that, then pay the gambling from the "offshore" account.

Howard Hughes
2nd Oct 2006, 11:07
I can see it now www.bankpoker.com... ;)

Oh shite, just clicked on it and I was only Joking!!

Disclaimer: Howard Hughes has no affiliation with the above mentioned website and does not condone online gambling!!

2nd Oct 2006, 13:37
Mr. Lexx, I don't claim to know the actual details, but as you have pointed out and reinforced my opinion in the process, it's not a difficult matter to find a way around laws when money is involved. Switzerland, the Caymans, Bahama etc have made a living for donkey's years off being an accessory to such matters.

My betting shop of choice is based in Australia, but they accept bets in nine different currencies. I maintain that this legislation is purely for the need to be SEEN to be doing something, to satisfy a few disgruntled constituents. It will make no difference at all in anything past the very short term, and as such is bad legislation. But why would I be surprised at that?

2nd Oct 2006, 14:42
I bet the Las Vegas lobby has something to do with that...

Those who want to continue please transfer your funds to my account as it is still legal to bet online here. I solemnly swear I will return all wins back to any account of your choice.

2nd Oct 2006, 15:46
Given the usual hysterical reaction from the stock market (before they fully weigh up the implications), could be a good time to pick up some shares.

Unless they've bounced already, of course.

2nd Oct 2006, 15:50
Was thinking exactly the same thing myself, frostbite, at least in hypothetical terms.

Speaking of which, where is Stockpicker?

Mr Lexx
2nd Oct 2006, 15:53

You might be on to something, although 888.com recovered 20p very quickly.

888.com Closed last night £1.46, lowest point today £0.73 now £0.995

Partygaming. Closed last night £1.07, lowest point today £0.405 now £0.475

In 888.com and Partygaming's businesses, USA revenues equate to 50% and 75% respectively.

Mr Lexx
2nd Oct 2006, 16:15
The current price of 888.com's shares is 1.0585. If you had purchased 10k of shares at 8.30 this morning, your 10k would now be worth 13k. Not a bad investment for a day's work!

2nd Oct 2006, 18:43
The current price of 888.com's shares is £1.0585. If you had purchased £10k of shares at 8.30 this morning, your £10k would now be worth £13k. Not a bad investment for a day's work!

Wrong! If I'd bought 10K of shares, the price would have plummeted. It's because I didn't buy them that the price rallied.

Mr Lexx
2nd Oct 2006, 19:29
Had a bad share dealing experience Gouabalfa?:8

2nd Oct 2006, 21:09
Comfort yourself with the thought that the buy/sell spread was probably so huge (as it often is for volatile shares) that you would only have missed out on half that!


2nd Oct 2006, 22:01
Looking at the trading history of 888 Holdings, Plc on the LSE, I don't see an extensive history of wide spreads in the bid/ask. There didn't seem to be such an instance today. Wide bid/ask spreads indicate sellers having some trouble finding buyers and buyers having similar difficulty finding sellers.

Today's trading volume was approximately 13.50 times average daily volume over the preceeding 3 months, indicating consistantly narrow bid/ask spreads and the spread equalling zero frequently enough for the volume to be achieved.

Where bid/ask spreads are frequently wide is in thinly traded issues, stocks that may well have a high beta when compared to the overall market index (upon which relative volatility is based), but where not only do sellers and buyers have widely varying opinions as to the future value of a company's cash flow, but their conviction as to this is strong enough for bids to not rise to asks or asks to not decline to bids.

Where this most frequently happens in the market with which I'm most familiar is on the OTC (pink sheets) where a company's absolute number of shareholders may be quite small and so the probability of buyers finding sellers declines. In general, the more numerous a company's shareholders, the more likely it is for the bid/ask spread to approach zero with greater frequency.

Mr Lexx
3rd Oct 2006, 08:33
Acrochick, good reading that, thanks!

I learn something new everyday! (I now have to lose something else that lives in my head to make room for that new knowledge :} )