Monday morning headlines

Market opened higher: And then it fell, with the Dow down about 50 points after two hours. Is anyone paying attention?

Citi report: WSJ reports that the U.S. government could wind up holding as much as 40 percent of Citigroup's common stock (bank executives are pushing for closer to 25 percent, the Journal says, citing sources). Just a few hours after the report, analysts were suggesting that the injection might not be enough.

The talks reflect a growing fear that Citigroup and other big U.S. banks could be overwhelmed by losses amid the recession and housing crisis. Last week, Citigroup's share price fell below $2 to an 18-year low. Bank executives increasingly believe that the government needs to take a larger ownership stake in the institution to stop the slide. Under the scenario being considered, a substantial chunk of the $45 billion in preferred shares held by the government would convert into common stock, people familiar with the matter said. The government obtained those shares, equivalent to a 7.8% stake, in return for pumping capital into Citigroup.

Soros sees no bottom: The billionaire investor says that the world financial system has effectively disintegrated, calling the turbulence more severe than during the Great Depression. From Reuters:

He said the bankruptcy of Lehman Brothers in September marked a turning point in the functioning of the market system. "We witnessed the collapse of the financial system," Soros said at a Columbia University dinner. "It was placed on life support, and it's still on life support. There's no sign that we are anywhere near a bottom."

SAG turns down offer: The board said no, on a 73 percent vote, mostly because the networks and studios refused to make the new contract for less than the usual three years (That would keep it in synch with the end dates of the WGA, DGA and AFTRA deals). From Variety:

SAG hasn’t said anything officially, but the renewed stalemate makes it more likely the guild will press for the intervention of News Corp. prexy Peter Chernin and Walt Disney Co. CEO Robert Iger to become directly involved in talks. That would be a reprise of the roles the duo played a little more than year ago in helping craft new contracts with the DGA and WGA.

Angel investing slows: The Tech Coast Angels pumped $75 million into local start-ups last year, down from $85 million in 2007. There were 15 first-time investments and 16 follow-on rounds from TCA members, up from 12 first-time and 14 follow-ons in 2007. The group does plan to keep funding start-ups. (LAT)

Slumdog's huge return: The Oscar-winning film was produced for $15 million, and they're talking about a $200 million box office worldwide. From Variety:

Director Danny Boyle and the producers are devoting some of those returns to a trust fund set up for two Indian children who starred in the film. Because of safety concerns, they're not specifying the amount of the fund, only that it is substantial. "These films are important because they defy conventional wisdom and show that someone can do something completely original and succeed, when so much of the movie industry has been commoditized. 'Slumdog' is the anti-'Paul Blart,' " said a Fox Searchlight exec.