Thursday morning headlines

Wall Street jitters: This could be a rough day for stocks, much of it the result of growing concern about the unwillingness of credit markets to finance all those private equity acquisitions. Up to now, Wall Street was only too happy to arrange deals, but that's quickly changing. The latest example: Postponement of the $12 billion sale of Chrysler Group to a group of investors (though the purchase is still expected to go through next month). Aparajita Saha-Bubna of Dow Jones Newswires reports this morning that "U.S. credit markets plummeted across the board Thursday as a swelling wave of risk aversion lifted risk premiums on benchmark derivatives indexes to record wide levels." From the WSJ:

The higher borrowing costs that are growing out of the recent debt-market turmoil promise to crimp the returns of buyout firms, potentially shrinking their influence and their ambitions. And companies, particularly struggling ones like Chrysler or Tribune Co., the media company, could feel the pinch. Until now, they have been able to obtain cheap loans to work out their problems or finance other plans. At the same time, the shifting environment could open the way for more conventional mergers, such as Siemens AG's $7 billion takeover of medical-diagnostics company Dade Behring Holdings Inc. Backed by stock and strong credit ratings, they don't usually rely as much on debt financing, and still have access to the capital they need to do deals.

Port talks: They're on, they're off - who knows at this point? The last contract between 17 major shipping lines and the 930-member Office Clerical Unit, Local 63 of the International Longshore and Warehouse Union expired July 1. The two sides remain at odds over wage increases and hiring practices. This has nothing to do with the 15,000-member ILWU (the clerks have elected their own officers and conducted their own contract talks since the mid-1990s), but if there were a strike the longshoremen wouldn't cross picket lines. (LAT)

Office market tightens: Too much demand, not enough space. L.A. County's overall vacancy rate was 9.2 percent in the second quarter, down from 11 percent a year earlier. Average asking rents rose 14 percent, to $2.53 per square foot per month, but the numbers were much higher in sought-after submarkets like Santa Monica and Westwood, where they exceeded $4.32 per square foot (data from Cushman & Wakefield). After years of little or no construction, a number of projects are going up, but the market will likely remain tight for the rest of the year. From the LAT:

Rents on the Westside increased before and after Blackstone bought Equity Office Properties Trust and its real estate portfolio for $23 billion this year, said Mark Sullivan, regional manger in the Los Angeles office of real estate brokerage Studley. One result of the increase that started in late 2006 has been a decline in the number of leases being signed, Sullivan said. "Activity has been cut in half." Many tenants are resisting the higher rents. "The deals being done are done out of necessity," Sullivan said. For example, a law firm that added more attorneys would have to bite the bullet and pay for more office space.

Housing stock rising: L.A. has seen a 28 percent increase in inventories from a year ago, according to a WSJ survey of metro areas. Actually, inventories are up almost everywhere, with the exception of Boston and Denver. But as we've pointed out before, be careful about those market-wide numbers. Supply and demand vary a lot by location.

The well-heeled can still get loans on attractive terms, and demand has held up far better for homes in desirable neighborhoods near city centers than for homes in more distant and humdrum suburbs. In the San Francisco Bay area, prices have continued to rise briskly in Marin County, a posh area with fairly short commutes to the city, and Santa Clara County, buoyed by hiring at Silicon Valley firms, says Scott Kucirek, general manager of Prudential California Realty. But prices generally have fallen in Solano County, which is a longer commute and has more new construction and entry-level homes.

Business.com sold: R..H. Donnelley, which publishes print and Web-based phone directories, is buying the business search engine for $345 million in cash, plus additional deferred payments. The Santa Monica-based company was started up in 1999 by Jake Winebaum and Sky Dayton (the domain name alone cost $7.5 million), with the expectation of becoming a major source for business news and information. But the idea never gained traction and then came the dot.com bust. The hefty price shows you how valuable the marketplace views search engines. (Reuters)

New boss for Telemundo: Mention the Spanish-language network and the first thing that comes to mind is the infamous Mirthala Salinas, the now-suspended reporter who had an affair with Mayor Antonio Villaraigosa. But NBC Universal, which owns Telemundo, has bigger fish to fry - namely improved results. NBC Universal executive Jeff Gaspin has been put in charge of the network (he also oversees domestic TV syndication and cable channels). Gaspin, who does not speak Spanish, becomes the fifth senior NBC executive to lead the network. (LAT)

Adult film lawsuit: Van Nuys-based E.A. Productions, known for its Evil Angel video line, accuses Kaytel Video Distribution of bootlegging its wares and selling them to retail stores, damaging its reputation and crowding legitimate product off shelves. E.A., which says it has been taking a huge financial hit, claims Kaytel infringed on its copyrights and trademark. The trial starts today. (Daily News)