These new hotels are rightly called resorts : for they are self-contained holiday biospheres catering for

These new hotels are rightly called resorts : for they are self-contained holiday biospheres, catering for every human need. The biggest, the 5,500- room MGM Grand, is ghastly – a garish dark-green glass pile from without, and not a redeeming shred of camp within. Not so its peers, like the Treasure Island, with its galleons, pirate shows and complete harbour, or Caesar’s Palace, or the Excalibur, guarded by Disneyland-style battlements of Camelot.All this ignores the quite astounding Luxor. Even as you touch down in Vegas you see it, a 30-storey black pyramid with its ochre-painted concrete sphinx, guarding the southern gate of the Strip Inside, amazement only grows. You may take a “Nile cruise” round the lobby, and stare up at the cantilevered tiers of rooms clinging to the inside shell, their doors tarted up like the entrance to a pharoah’s boudoir But how to fill the vast empty space inside? Easy. With a 10-storey mock-up of Manhattan, a replica of Tutankhamun’s tomb, and every Egypt-related service you could imagine. If you must have your name written in hieroglyphics, this is the place to come.

Had it been around a decade ago, Liberace would have been playing there, robed like Queen Nefertiti. It’s make-believe, it’s tacky, but he would have adored it.RUPERT CORNWELL. DIANE COYLE

Economics Correspondent
The pound crashed to a record low on the foreign exchange markets yesterday as overseas investors stampeded out of sterling in reaction to the Conservative leadership battle.The City described it as a sterling crisis but did not expect it to trigger an emergency rise in interest rates.The pound’s index against a range of other currencies touched its record low, set seven weeks ago, during the afternoon. Dealers predicted it would continue to fall until the leadership is decided.”This is definitely a crisis,” said Ifty Islam, currency strategist at investment bank Merrill Lynch. “We can only hope this is the point of maximum uncertainty.”The weakness of the pound will be high on the agenda at next Wednesday’s monthly meeting between Kenneth Clarke, Chancellor of the Exchequer, and Eddie George, Governor of the Bank of England.

Although a rise in base rates the day after the first round of the leadership election would astonish the City, financial markets have revised up their bets on the level of base rates by December.The short sterling futures market now expects rates at 7.5 per cent by the end of the year.The pound’s fall reflected widespread selling by long-term overseas investors, shaken by the speculator-driven drop in the currency after John Redwood’s announcement on Monday.Rumours in the afternoon that Michael Portillo had resigned from the Cabinet to enter the first round, although promptly denied, ratcheted sterling down another notch. The switch from mainly speculative to mainly institutional selling occurred overnight in New York.Paul Chertkow, chief currency economist at UBS, said: “Anything that brought the general election forward would now be seen as positive by overseas fund managers. It would end the uncertainty.”Nick Parsons at Standard Chartered agreed. “It is the only time I have known the need for a Labour government to rally sterling,” he said.The sterling index touched 82.7, the record low set on 9 May, on the Portillo rumours, before recovering to close at 82.9. Against the mark it fell to DM2.1860, less than a pfennig higher than the all-time low, closing at DM2.1889. The pound has fallen nearly five pfennigs since John Major’s announcement last Thursday.The dollar’s weakness added to sterling’s problems yesterday.

As well as continuing worries about the trade war with Japan, a sharp fall in consumer confidence also hit the US currency.The confidence index fell to its lowest level since last October, in the biggest decline since early 1992. One of the few economic indicators to be published before the Federal Reserve’s policy meeting next week, it boosted chances of a cut in US interest rates. US bonds and shares rallied, while the dollar fell temporarily below DM1.37 and 84 yen.Chris Turner, currency analyst at BZW, said: “If the dollar dives because trade sanctions are imposed, the pound will be in even bigger danger.”An additional hurdle this week is a big auction of gilt-edged stocks tomorrow, when the Bank of England has to sell pounds 2.5bn worth of gilts.Mr Islam said: “The auction’s success or otherwise will be an important signal of the state of confidence.”Most analysts agreed that the worst outcome for the pound next week would be for Mr Major to cling to power without a resounding victory. Investors were concerned about the uncertainty as well as the policies Mr Major or a successor might turn to before the election. Markets fear over-generous tax cuts and a more relaxed attitude to interest rates.George Magnus, of SG Warburg, said there were also concerns that a Conservative government led by a Eurosceptic would undermine any interest in the pound’s level against other European currencies “Portents for the pound all look very bad. Its recovery might have to wait until we have a pro-European Labour government,” he said.Amid consternation about political developments, dealers speculated that the Bank of England had intervened secretly to smooth the pound’s downward path. Some predicted open intervention to send a signal to the markets as the next step.An increase in base rates was seen as a last resort, and one that could well be counter-productive.

“Investors would see it as a panic measure,” Neil MacKinnon, Citibank’s chief economist, said. Past experience of the effect of higher base rates on the pound is not encouraging – a 3 percentage point jump in September 1992 could not stop the pound crashing from the exchange rate mechanism.. DAVID USBORNE

New York
With more than half an eye on his popularity rating at home, President Bill Clinton yesterday served notice that he would not flinch from imposing tariffs against Japan in the car-parts dispute if a last-minute deal was not struck in Geneva.It was clear throughout yesterday that the US administration was gearing up to make maximum political capital out of the conclusion of the Geneva talks, whatever their conclusion. Surveys show the President’s tough stand with Japan is playing well with American voters, and there was no mistaking his determination yesterday.He told an economic conference in Portland, Oregon: “I am not trying to launch a new era of protectionism, but we have tried now for two or three decades to open this market and this is the last major block to developing a sensible global economic policy.”With the prospect that the tariffs might be applied within hours, he said: “I hope I won’t have to do it I have worked with Japan to avoid this kind of problem. But decades of American presidents have tried and failed to open this market.”"The bottom line is we want to open the markets for American products, and we will take action if necessary in the form of sanctions,” he said.The imposition of tariffs, retrospective to mid-May, would however spell disaster for dealers in the US selling the Japanese models, including Lexus and Infiniti and the more expensive models offered by Honda and Mitsubishi.With their models expected almost to double in price, many dealers could be forced out of business quickly.As Mr Clinton addressed the Portland conference, workers from Japanese car dealers and distributors demonstrated outside, waving placards proclaiming that, if effected, the tariff proposals would threaten 14,000 US jobs.The measure could, however open the door for a boom for European luxury car manufacturers, particulary Jaguar, BMW and Mercedes, which will scramble to fill the void left by the Japanese.In the meantime, Chrysler announced yesterday that it was spending $100m to buy out a car distributor in Tokyo as a means to boost sales of its cars and recreational vehicles in Japan. Chrysler said it was taking control of Seibu Motor Sales.Chrysler Japan Sales..