China's Macau review could spell bad news for gaming industry

With the casino business in Las Vegas taking a huge hit during the recession, companies including Las Vegas Sands (LVS), MGM Mirage (MGM) and Wynn Resorts Ltd. (WYNN) have looked east for profit -- as far as Macau, the world's biggest gambling center. On Monday, however, the Chinese city's government threw a pail of cold water on their plans by suggesting it may limit the aggressive expansion in this booming market.

According to the Wall Street Journal, representatives of Macau's government met with casino operators to "review" the industry and lay down new restrictions, including raising the age for gaming from 18 to 21. Last year, the Chinese government clamped down on travel to Macau from nearby Guangdong province, ostensibly to fight gambling addiction, resulting in a drop in revenue. Since then, however, restrictions have been loosened and returns from the casinos hit a new high in August of $1.4 billion.