CORPORATIONS: Blue-Chip Blues

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No one ever broke the bank at Monte Carlo, but last week the management of the famed gambling Casino felt as if someone had. For the second time in its 85 years, it was in the red. In its last fiscal year, the Casino lost some 136,000,000 francs (about $450,000 at current rates), almost twice as much as in its other red-ink year, 1936-37.

Stockholders of the Société des Bains de Mer et du Cercle des Etrangers à Monaco (Sea Bathing and Foreigners' Club of Monaco), which runs the Casino, got the news at a meeting in the Casino's ornate Salle Ganne, a floor below the gaming rooms. While gamblers tried their hand upstairs at roulette, baccarat, and trente et quarante, 70-year-old Chairman Alfred Delpierre explained how the odds had worked against the house.

The main trouble was currency restrictions. Britons, the chief support of the Casino before the war, now came rarely, gambled little. (The heavy-betting Nazis had supported the Casino during the war.) And well-heeled black marketeers steered clear of the gaming tables; the French collectors keep a close watch on them to spot tax dodgers.

The Monaco government, which owns 10% of the Société shares, had been no help, said Delpierre. It had backed union demands for higher wages while refusing to reduce its cut of 15,000,000 francs—some $125,000. (The Prince of Monaco also gets a cut.) The hard-pressed Société cut the work week, gave all hands a month's leave a year without pay, reduced the staff of 1,487 by lowering the retirement age. On their part, Monégasques blamed the Société for bad management and two poor investments: 20.000,000 francs for a 1,500-ton yacht, and 50,000,000 francs for a new restaurant.

Whatever the causes, all agreed that there was only one cure: Yankee dollars. To get them, Monaco has begun plugging its tourist beauties (and little mention of gambling) in U.S. newspaper ads as discreet as wedding invitations.

The Société has been more direct. It sent out a cry of distress to shrewd, dapper René de Léon, who headed the company for 14 successful years (1922-36), is now a Hollywood hotelman (The Garden of Allah). Said he: "They asked me if I could find people here who would want to put money in to buy shares. They hoped I would return at the head of a wagonload of American gold. [The manager] came to me and said, 'Tiens! My friend, give me the best juice of your brains.' "

René de Léon decided to stay in Hollywood. The best juice of his brains told him that Europe's plight and the union setup made the Casino a poor investment.