Markets tumble: This is not shaping up to be a great day, with more losses from JP Morgan and more worries about the financial sector in general. Oil is down slightly this morning, despite BP's decision to shut down its pipelines in Georgia. (AP)

Expecting another failure: Nearly 60 percent of institutional investors surveyed say that another big financial firm will collapse within the next six months. Another 15 percent think it will happen in six to 12 months. There's particular concern about so-called counterparty risks, where exposures through derivatives or other securities to a failed bank can become a house of cards. (FT)

Underwater homes: Almost 30 percent of U.S. homeowners who bought in the last five years owe more on their mortgages than their properties are worth, according to Zillow.com. California was the negative equity capital: In Stockton, Modesto, Merced and Vallejo-Fairfield, the number of homeowners whose mortgage debts exceeded the values of their properties topped 90 percent. In the Inland Empire, Bakersfield, Yuba City, El Centro and Madera, the percentages were more than 80 percent. (Bloomberg)

Bank's future uncertain: Vineyard National Bancorp said in an SEC filing that housing-related losses and depositors' withdrawals are "affecting our liquidity and our ability to meet our obligations as they have come due." It said "significant additional sources" of funds are needed to "continue operations through 2008 and beyond." The Corona-based company specializes in financing home builders and issuing high-yielding CDs. (LAT)

Downey's bleeding stops: The bank experienced a bunch of withdrawals last month on word of potential problems, but 40 percent of those lost net deposits have been recovered. The lender did warn that it would be vulnerable if customers start taking their money out again. Downey said it's close to maxing out its $3-billion line of credit with the Federal Home Loan Bank system. (LAT)

More troubles for Ed McMahon: The former "Tonight" show sidekick - and truly terrible manager of money - has been sued by a Huntington Beach lender who is going after a $250,000 loan it said McMahon has not paid back. In July, he was sued by his former lawyers for $275,167 over nonpayment of a legal bill. McMahon had already failed to make payments on $4.8 million in mortgages with Countrywide. His home is listed for sale at $4.6 million. (LAT)

Lacter on radio: This morning's business chat with KPCC's Steve Julian covers the recent drop in gas prices and predictions about when the housing market will bottom out. Also available on kpcc.org or on podcast.