Wednesday morning headlines

Market recovering - a bit: The Dow was up over 100 points in early trading, but it's sliding back.

Nationalizing banks?: It's considered a last-ditch option, but the WSJ reports that Obama’s folks are moving in that direction. One possibility: buying convertible securities from financial institutions. That would leave Uncle Sam owning large chunks of many firms' common shares.

Obama administration officials are sorting through a menu of options as they prepare efforts to clean up bank balance sheets and put them in a better position to lend. Discussions have also advanced on creating a government-backed institution that would buy and hold banks' bad assets, as well as a plan to provide government guarantees on bank holdings. Analysts say that until the Obama plan is unveiled, investors appear to be bracing for the worst-case scenario. "There's a crescendo of fear in the marketplace," said John McDonald, a banking analyst at Sanford C. Bernstein & Co. Investors are dumping bank stocks "because they don't know what the next government solution is going to be, and there's a fear that whatever it is, it's going to ultimately be dilutive to shareholders."

Geithner questioned: Obama's pick for Treasury Secretary is getting grilled on the new administration's plans to deal with the banking crisis. He's also apologizing about not paying $34,000 in payroll taxes earlier in the decade. (AP)

Funding for inauguration: Among the folks forking over the maximum 50K: Kate and Steven Spielberg, Tom Hanks, George Lucas and L.A. billionaire and Oaktree Capital Management Chairman Howard Marks. Hedge fund managers were also big givers. Here's the list.

Airport traffic takes tumble: The worsening economy is taking its toll - LAX saw a drop of 3 million passengers last year, to 59.5 million. Most of the losses were in the last four months of the year. Traffic was also down at John Wayne, Bob Hope and Ontario airports. (LAT)

Stadium-related financing approved: A whopping 60 voters in the City of Industry approved the sale of up to $500 million in bonds for infrastructure improvements that would help support an NFL stadium. The stadium, which is the work of Ed Roski, would also include retail and office space. Is the NFL even paying attention? (LAT)

Lacter on radio: Once more, the KPCC business chat with Steve Julian is moved to Wednesday (there was that little inauguration thing yesterday morning). Topics include how the recession is putting the squeeze on low-wage jobs and when the foreclosure wave might pass. Also available on kpcc.org and on podcast.