MONDAY 3 PM:  After the Dow ended 504 points in the dumper, its worst plunge since 9/11, shares of Big Media companies miraculously were down but by no means out at the close of trading. Hardest hit was NBC Universal’s parent company GE whose stock fell to a 5½-year low because investors are worried about the value of assets held by the conglomerate’s financial arm GE Capital, which accounts for most of its borrowing and more than one-third of its profit:
Disney fell $.79 or 2.4%, to $32.47
News Corp (Fox) fell $.59 or 4.1%, to $13.81
Time Warner fell $.45 or 3.1%, to $14.12
Viacom fell $.54 or 2.0%, to $26.62
CBS fell $.69 or 4.09%, to $16.16
GE (NBC Universal) fell $2.15 or 8.04%, to $24.60

MONDAY 3 AM: Don’t bother trying to call anyone important in Hollywood on the phone this morning because showbiz bigwigs will be huddling with their business managers and brokers and bankers to figure out what to do with their personal portfolios during Monday’s stock market bloodbath. By 3 AM PT, when I went to sleep, the Dow Jones futures were already down 340 points, the S&P 500 futures down 40 points, and the NASDAQ futures down 50 points. That’s butt ugly. So many studio and network types have seen their stock options stay underwater for years, rendering that past perk all but meaningless, that they’ve depended on their personal holdings as much as on their salary and bonus to build net worth. Ergo today’s certain panic. (And I hope there’s a special hell reserved for “naked” short-sellers, and eventually a perp walk.)

But Hollywood and their Big Media parent companies will be affected by Bloody Monday as well. NBC Universal’s parent company General Electric, long a safe bet for Wall Street and Main Street alike, was singed by the fire sales on financial stocks Friday when GE shares fell 5% over nervousness of its inability to sell its private-label credit card biz. In terms of other infotainment companies, all the stocks are down, down, down. But Big Media’s CEOs are on record telling financial analysts that their biz won’t be impacted much by any economic depression. (They weren’t ignoring Sarbanes-Oxley by lying, were they?) The networks have seen advertising go way down for TV broadcasting, but way up for Internet streaming. And moviegoing jumped +35% this weekend at the North American box office compared to last year’s. So, SAG, don’t cry for the employers when the AMPTP comes back to the bargaining table and cries poverty all over again. 

With once high-flying investment firms and banks around the world now grounded, the debt market seems nonexistant, so studio and indie films companies are going to find it nearly impossible to find new financing. And, if they do, the terms will be poisonous. Fortunately, all the studios except for Paramount and MGM already have in place overall film slate financing deals to get them through the next few years. These aren’t crucial for survival, but they do help a studio to mitigate its risk. That’s why Fox has its Dune deal, Warner Bros. has Legendary, Disney has Kingdom, both Sony and Universal have Relativity, and United Artists has Merrill Lynch funding (but who knows how much longer given ML’s weekend sale).

But the smart Big Media chairmen and Hollywood bosses would do well to study what happened to Bear Stearns, Lehman Brothers, American International Group, Washington Mutual, Wachovia, and maybe even Morgan Stanley and Citibank: CEO hubris broke or are breaking those once-seeming financial fortresses apart at the seams. It can happen to you, too. Get your houses in order. Everyone knows you sons-a-bitches are waiting until  September 18th to see if the SAG election ushers in a more compliant board. No matter, when the results are announced, you’d better order the AMPTP to make a deal with the biggest actors guild right after.