It turns out casinos aren't recession-proof after all.

That used to be an economic truism, but it's been put to the test in the last year, and especially since the start of 2008.

"The last six months have really blown conventional wisdom to smithereens," said Joseph Weinert, an analyst with Spectrum Gaming Group.

Pittsburgh's nascent gaming industry is already absorbing the shrapnel.

Detroit businessman Don Barden has been trying to secure financing for his North Shore casino for nearly two years -- but he was never able to, and this week, already defaulting on one loan, he forfeited his majority stake in the operation and his casino license to another investment group.

To the north, in Lawrence County, Centaur Inc.'s Valley View Downs also is in jeopardy -- on Thursday, the state Gaming Control Board denied Centaur's request for a temporary slots license so it could start building its racetrack casino, and now Centaur's CEO says it may lose its project financing.

If it makes local gambling fans feel any better -- and it probably won't -- it's not just the local projects that are aching.

In fact, it's hard to recall a worse week for gambling nationally.

Las Vegas reported its Strip revenues had dropped 16 percent last month; Atlantic City had a horrible June as well; revenues also were down in Illinois, St. Louis and Kansas City, Mo.

As a result, casino stocks tumbled this week -- MGM Mirage share prices fell nearly 22 percent on the news out of Vegas, while Las Vegas Sands Corp. was down to a three-year-low, and Wynn Resorts Ltd. dropped 9.8 percent on the bad news, according to MarketWatch news service.

Casinos from Atlantic City to Vegas are being forced to reconsider their construction projects, trim work force and drop room rates to their lowest levels in five years.

Mr. Barden's Majestic Star and Centaur are "caught up in the market, in an environment over which they have no control," Mr. Weinert said.

"Between the lack of affordable funds and the high fuel prices, casino companies are just having a very tough time getting customers and capital."

The troubled capital waters are proving especially difficult to navigate.

Not long ago, an investor could secure a multimillion-dollar line of credit by putting up just a quarter of the full project price in equity.

Now, said Dennis Farrell, an analyst with Wachovia Securities, finance houses are asking for 50 percent investor equity.

That means a developer such as Mr. Barden, who at one time might have been expected to put up $195 million toward an $780 million casino, now may have to come up with twice as much.

Some casinos were designing "projects that were probably too aggressive," Mr. Farrell said.

"And now operating conditions have turned, and these capital structures have too much leverage on them."