Thursday morning headlines

Big cuts at Microsoft: Both revenue and net income were below earlier guidance, which helps explain the 5,000 jobs that will be eliminated (starting with 1,400 today). The layoffs appear to be a first for Microsoft. (All Things Digital)

Disney offers buyouts: Executives from the parks and resorts division have until Feb. 6 to decide - otherwise, there may be layoffs. Analysts at Morgan Stanley estimate that combined attendance at Walt Disney World and Disneyland will drop 7 percent this year. (Orlando Sentinel)

More lousy numbers: New-home construction fell to an all-time low in December and new jobless claims rose more than expected. (AP)

Shenanigans at Merrill: Hmmm - $3 billion to $4 billion worth of bonuses went through just three days before the sale to Bank of America went through, according to the FT (normally the bonuses go out in late January or early February). B of A attributed the decision to John Thain, who had been Merrill’s CEO until the deal closed on Jan. 1. From DealBook:

“Merrill Lynch was an independent company until January 1, 2009,” Bank of America said, according to The Financial Times. “John Thain decided to pay year-end incentives in December as opposed to their normal date in January. BofA was informed of his decision.” Mr. Thain had reportedly lobbied for a $10 million bonus for himself, only to withdraw the request when the board balked. Mr. Thain has stayed on at the combined firm, where he oversees trading, investment banking and brokerage operations. Breakingviews said the report just adds to the bad smell lingering over this financial merger, which was negotiated over a frenzied weekend last fall. It points out that BofA employees are still waiting to hear what their 2008 bonuses will be, and Merrill’s move is “almost certain to breed contempt among new colleagues.”

Gas prices keep rising: The average price of regular in the L.A. area jumped more than seven cents in the past week, to $2.04 a gallon. Refiners have been reducing production of gasoline for the California market. (LAT, EIA)

Sign company goes to court: SkyTag says the city should not be allowed to remove the company's supergraphics until litigation involving an outright ban is resolved. Some of those monster signs, by the way, have blocked windows and infuriated office workers. From the LAT:

[Michael McNeilly, president and founder of Beverly Hills-based SkyTag] pointed out that three of his images targeted by building inspectors are depictions of the Statue of Liberty and are constitutionally protected. "I'm an artist putting out a work of art and making a political and artistic statement," he said. "And it's amazing to me that there's such push-back on something that's an iconic image of our country." Not all of the buildings on McNeilly's list have patriotic imagery, however. One of the addresses submitted to federal court by SkyTag is 6922 Hollywood Blvd., whose north- and east-facing sides feature an advertisement for "I Am King," the cologne marketed by rapper and actor Sean "Diddy" Combs.

New investment chief: Calpers, the largest U.S. public pension fund, has named Joeseph Dear as its new chief investment officer. Dear had been executive director of the Washington State Investment Board. Calpers lost a ton in the last 12 months, much of it coming from lousy real estate decisions. (Bloomberg)

Northrop to post loss: The L.A.-based aerospace company says the recent market turmoil has forced it to take up to a $3.4 billion write down in the value of goodwill recorded on acquisitions made in 2000 and 2001. (AP)

Burkle wants more money: The L.A. billionaire's magazine distribution company, Source Interlink, is demanding that publishers pay an additional 7 cents per magazine, regardless of the number of copies sold at the newsstand. Source Interlink joins another distributor, Anderson News, in raising its prices. (NY Post)

And the nominees are...: For best picture, it's “The Curious Case of Benjamin Button,” “Frost/Nixon,” “Milk,” “The Reader” and “Slumdog Millionaire.” Here are all the nominations.