"Above the roulette tables," Lewis writes, "screens listed the results of the most recent 20 spins of the wheel. Gamblers would see that it had come up black the past eight spins, marvel at the improbability, and feel in their bones that the tiny silver ball was now more likely to land on red. That was the reason the casino bothered to list the wheel's most recent spin: to help gamblers to delude themselves."

For those of us who live in Las Vegas, this episode had particular resonance, because it seemed entirely appropriate that a Las Vegas ballroom would be the epicenter of the collapse of the world economy. We supplied many of the bad and often phony borrowers to buy the newly built, shoddy homes with mortgages that were later securitized.



WE ARE ALL VEGAS



It's hardly coincidence that financial industry critics have taken to calling Wall Street a giant casino. The results for both of us have been less than ideal. The Las Vegas economy remains a basket case, with an unemployment rate of 12 percent, plus clogged bankruptcy courts and a ravaged real estate market. The American economy isn't doing much better.

The Vegas-ized American economy wasn't always a tragic tale, however. Not long ago, Las Vegas was to be the first American city of the new century, and its growth and broadly shared prosperity considered miraculous in the face of the rest of the country's post-industrial stagnant wages and widening wealth disparities.

In his seminal 2002 book "Neon Metropolis," the late University of Nevada Las Vegas historian Hal Rothman captured Las Vegas as the post-modern city of the age: "Las Vegas now symbolizes the new America, the latest in the American dream capitals....It is the place to be as the new century takes shape, for in its ability to simultaneously attract and repel, it characterizes American hopes and fears. Las Vegas tells us what has happened to American society and what we now aspire to: simple possession of the ethos of status."

As Rothman notes, no matter who you are or what your aims, you can get anything you want in Las Vegas if you're willing to pay for it, so it's no surprise that it was America's fastest growing city in the Second Gilded Age.

But let's step away from the airy sociology. The parallel paths of America and Las Vegas are quite evident and concrete. By changing its gambling licensing requirements, Nevada allowed corporations into the market in 1967. Eventually, the mob couldn't compete, and Nevada's power brokers figured out the real money didn't reside in seedy ethnic social clubs -- it was in the corporate boardrooms.

Over time, Las Vegas would benefit from the libertarian ethos -- both social and economic -- that arose out of the 1960s and 70s. The stigma of gambling lessened, not just card games and dice, but also in the financial markets, where regulators and financiers alike believed risk had been mastered.