Thursday morning headlines

Still no rally: The Dow was up 120 points in early trading and has now pulled back into minus territory. By the way, today is the one-year anniversary of the Dow’s record high of 14,164.53 (ouch!). Right now, it's hovering around 9200.

New U.S. rescue idea: Actually, it's similar to what the British government is doing in an effort to shore up its financial institutions. The plan would have the Treasury Department take ownership stakes in U.S. banks. Many economists say that’s preferable to buying up distressed assets. The authority to make such bank investments was inserted into the $700 billion bailout bill. From the NYT:

Treasury officials say the just-passed $700 billion bailout bill gives them the authority to inject cash directly into banks that request it. Such a move would quickly strengthen banks’ balance sheets and, officials hope, persuade them to resume lending. In return, the law gives the Treasury the right to take ownership positions in banks, including healthy ones. The Treasury plan was still preliminary and it was unclear how the process would work, but it appeared that it would be voluntary for banks.

What about CA?: A new Federal Reserve plan to buy commercial paper probably won't be available to states and local governments that are struggling to pay their bills. "You need to adjust the scope of the program so it includes municipal commercial paper," said California Treasurer Bill Lockyer. Next week, the state plans to offer $4 billion worth of short-term notes for sale and if they don't sell, there may not be enough money to pay for salaries and other routine expenses. From the LAT:

To underscore the importance of the upcoming sale, Gov. Arnold Schwarzenegger will appear in advertisements set to air on Los Angeles and San Francisco news-radio stations beginning Thursday. The governor is urging individual Californians to invest in their state by buying the notes during a retail sales period Tuesday and Wednesday. The notes will be available for purchase by commercial and institutional investors Oct. 16, and sales are scheduled to close Oct. 23.

More CEOs quitting: Through the end of September, 1,132 chieftains left their posts in 2008, a 9 percent increase from the like period a year earlier. The consulting firm Challenger, Gray & Christmas says this could be a record year for CEO departures. (Portfolio)

Feelers for San Diego paper: The Copley-owned Union-Tribune is getting looks from Tribune, MediaNews, Stephens Media, Ron Burkle's Yucaipa Cos., Bev Hills investment firm Platinum Equity and a few others. Keep in mind that this is still the tire-kicking stage of the sale and several of the parties mentioned are notorious for looking but not bidding. From the Union-Tribune:

Tom Rosenstiel, director of the Washington-based Project for Excellence in Journalism, said any potential buyer will need the financial strength and patience to hold on until the newspaper business improves. Additionally, buyers will need the wherewithal to borrow or otherwise raise cash amid the ongoing credit crunch. But Rosenstiel said anyone who is optimistic about the long-term potential for the industry, whether on print or online, could get a good deal.

Oscar night movie ads: The anachronistic policy of banning movie commercials during the Academy Awards has been loosened. From now on, a limited number of spots will be allowed, so long as they do not open until the last week of April (leaving out nominated films). From Variety:

The showcase of never-before-seen spots for, say, next year’s tentpoles like "Transformers: Revenge of the Fallen," "G.I. Joe" and "Terminator Salvation," could be a highly promotable element for next year’s telecast — especially as the Oscars are looking to rebound from this year’s record-low aud of 32 million viewers. Next year’s telecast is set for Feb. 22 on ABC. The "Dreamgirls" duo of Bill Condon and Laurence Mark have been tapped as first-time Oscarcast producers.

Spielberg delays pitch: Bank financing still hasn't been secured for the refashioned DreamWorks, and with the markets the way they are the plan is to sit tight until early next year. The DreamWorks folks already have the $550 million infusion from India's Reliance Big Entertainment. From THR:

DW's lead banker JPMorgan also will put up about $125 million and aims to secure similar pledges from one or more other lenders in January -- or about a month later than initially envisioned. A small loan syndication also is planned with the hope that the various lending commitments will total $650 million or more. That's about $100 million less than originally targeted before the turmoil on Wall Street. The modestly lower loan package and the delay in pitching additional lenders is a simple acknowledgment that the recent market woes will have bankers preoccupied for the next few weeks.

Flyaway fares going up: Beginning Jan. 1, one-way fares will increase from $4 to $6 along the Union Station and Van Nuys Airport routes, while fares on the Westwood line will increase from $4 to $5.