Thursday morning headlines

Stocks floundering: Guess everybody is preoccupied with Bernie Madoff. After two hours, the Dow is up 60 points (at one point the index was over 7000).

Big climb in foreclosures: California had 80,775 filings in February, according to the latest Realty Trac numbers, which is up 5 percent increase from the previous month and 51 percent from a year earlier. As usual, the California Five - Stockton, Modesto, Merced, Riverside-San Bernardino and Bakersfield - were among the top 10 cities with the highest foreclosure rates. (press release)

Mereulo in trouble: Downtown's parking lot king and now one of the largest landowners and developers has stopped making interest and principal payments on 26 loans totaling $266 million and may consider filing Chapter 11. The company he runs, Meruelo Maddux, has been trying to sell many of its downtown properties in order to raise cash. From the Downtown News:

The company has also ceased all major development activity, except for its under-construction condominium project 717 Ninth in South Park, which is being financed by an $84 million loan that the company continues to pay interest on. “This company is in big trouble,” said Tracy Seslen, a professor in the Department of Finance and Business Economics at USC’s Marshall School. “If they could only sell some of their properties then they could use some of that cash to service the debt that they have, but it just looks like nobody is buying right now, at least not at the price they want to sell.”

Vegas getting hammered: The Visitors Authority says 340 events have been called off over the past three months, costing local resorts 112,000 guests. Among those that have pulled the plug: Citigroup, Wells Fargo and Goldman Sachs. In January, the city reported a 12 percent drop in visitors from a year earlier. (NY Post)

Jump-starting tanker deal?: Remember the hullabaloo last year between Northrop and Boeing over a huge contract to supply aerial tankers to the military? Well, the latest idea being floated is to somehow divide up the work. (Northrop teaming up with Europe's Airbus has caused much of the fuss.) The compromise plan emerged after the entire program was threatened to be delayed. From Politico:

Sens. Kent Conrad (D-N.D.) and Orrin G. Hatch (R-Utah) wrote a letter to Deputy Defense Secretary William Lynn on Wednesday saying that rather than delay the tanker program, as has been proposed, the Pentagon should speed up the competition. Conrad chairs the Senate Budget Committee and leads the Senate Tanker Caucus with Hatch. “We believe that any additional postponement of the tanker recapitalization program will have a serious and unnecessary adverse effect on our service members’ ability to carry out the national military strategy,” the senators wrote. “Accordingly, we recommend that the department recommence the aerial refueling tanker competition on an expedited basis.”

Tom Hanks to the rescue?: He and George Clooney apparently have gotten involved in the stalled contract talks between SAG and the media companies. From the LAT:

Hanks and other A-listers have made calls to high-ranking executives at the major media conglomerates, urging them to find a compromise with their union. Apparently the outreach has had some effect. Several top media executives, including News Corp. President Peter Chernin and Walt Disney Co. Chief Executive Bob Iger, have talked among themselves this week about how to resolve the dispute with SAG. Chernin and Iger played a pivotal role in helping to craft the deal with Hollywood's directors and writers.

Icahn vs. Lionsgate: The Lionsgate folks don't want to replace its directors with people who lack a background in the entertainment business - namely, Icahn's 29-year-old son Brett, who is said to be interested in moving into showbiz. From the Lionsgate statement via Variety:

"We are always open to hearing the ideas of our shareholders and exploring ways to incorporate them," the execs said. "Over the past three weeks, our board of directors has been in discussions with Mr. Icahn to consider how we could accommodate some of his requests, including the possible appointment of his designees to the board of directors. However, the board ultimately concluded that it could not meet his requests and continue to serve the best interests of all of our shareholders, which is our No. 1 priority."