When most people were saying that what Atlantic City needed was an 8-block-wide bulldozer, Reese Palley suggested a nude beach. What they got was a casino.

"I bet $10,000 that the gambling wouldn't come off," says Palley, relaxing in his Boardwalk store just a dice throw away from Resorts International. "After all, where else could you sell a building that wasn't worth the powder to blow it to hell and make it into an operation grossing $3 million a week?"

They call him "Mr. Atlantic City," the art dealer who put porcelain Boehm birds on the mantles of every Main Line socialite, the frizzy-haried goateed man in black whose flamboyant taste for self-promotion has on more than one occasion short-circuited the seaside community he was born in 57 years ago.

Palley opened his first store in 1957, selling what can only be described as kitsch for the rick; crystal seagulls and porcelain knick knacks. Two other branches, in San Francisco and Palm Beach, have been added.

"When I called myself 'Merchant to the Rich' it upset a lot of people. Rich is a four letter word."

Six years ago Palley made headlines by flying 750 of his most intimate friends to Paris for a birthday party. Last month a giant billboard was erected on the Boardwalk, a winning, grinning Palley mouthing the words, "Hit Me Again, Reese."

A promotional campaign is underway for the East Coast, using the unforgettable Henry Kissinger-like image of Palley. The copy reads, "You've Got a Friend in Atlantic City." His bespectacled face will be plastered on billboards and between the pages of chi-chi magazines as the rejuvenated resort's favorite eccentric. Reese Palley loves it.

"I'm just a peddler," he says relaxing on a leather sofa in the roped-off area of the store's Edward Marshall Boehm collection. "I've been successful because I realized what Americans need." Which is? "Sensation.

"I love vulgarity. I love the nouveau riche. I can't stand the old money, they're all too stuffy and too conservative."

Palley is the chairman of the New Jersey State Lottery. Will the casinos help or hurt the lottery? Palley feigns a painful expression. "My dear," he explains. "That's like asking what masturbation will do for sex."

Palley says the first "payoff" after the gambling law went into effect was a visible one. "The whores got better looking. Before that, we had the ugliest looking whores in America."

And though he's not a gambler himself, Palley thinks the casinos are "handsome, sexy and alive. The people are well-treated, they're handled well. For a short time they're kings of the universe. There's nothing wrong with that."

The man who says his only goal in life was to make $100 a week purchased the stately Marlborough-Blenheim Hotel in March for $6 million after being cajoled into the real-life Monopoly game by a partner, attorney Martin Blatt. The pair recently leased the hotel to the Bally Corp. which plans to resurrect the resort into an $83-million casino.

The lease expires in 2018. Why not sell outright? Pass Go and collect millions. "I couldn't bring myself to sell Park Place and Boardwalk," Reese Palley says sheepishly. "That's the address."