Friday morning headlines

Stocks back up: Who knows - maybe today's retail numbers look a little better than yesterday's. Dow gains about 80 points in early trading.

Madoff had help: That's what the government is alleging with this morning's arrest of two computer programmers who are accused of falsifying records at Madoff's firm - and in the process helping make the Ponzi scheme happen. (AP)

Activision's big day: A record 4.7 million copies of "Call of Duty: Modern Warfare 2" were sold on Tuesday, the first day of release by the Santa Monica-based company. That's $310 million. From Bloomberg:

"It's an absolutely unbelievable number," said Mike Hickey, an analyst at Janco Partners Inc. in Greenwood Village, Colorado, who has a "buy" rating on the shares and doesn't own any. "This has been called the biggest entertainment release of all time for the last six months."

Game action still weak: October saw a 19 percent drop in overall U.S. sales compared with last year. Console sales were down 23 percent and software sales down 18 percent. There's concern about the holidays. (LAT)

Loose talk from NY governor: David Paterson suggests on Bloomberg Radio that California might eventually go into default, a knuckleheaded comment on many levels - not the least of which is that it almost certainly wouldn't happen. From Money & Co.:

For the record, the California Constitution mandates that state tax revenue must go first to pay education costs, and second to repay general-obligation bond debt. All other expenses are subordinate to those two. Tom Dresslar, a spokesman for California State Treasurer Bill Lockyer, said the treasurer would be "happy to have not just the legislature of New York but also the governor come out to California so we can show how we have a perfect record of paying investors in full and on time, and how we will maintain that spotless record."

Penney's on the mend?: The department store retailer upgraded its outlook because more goods are being sold at regular price. Sales, though, remain weak. (AP)

Bidding for Playboy: An investor group led by Jim Griffiths, Playboy's former entertainment president, is in talks to acquire the company. Also in the race is the firm Iconix Brand Group (London Fog, Joe Boxer, Mossimo). Price is believed to be in the $300 million range. From the LAT:

Any decision about a purchase will come down to Hugh Hefner, Playboy's founder and public face, who controls about 70% of its voting stock. A buyer would have to persuade Hefner not only to relinquish control of the company he started 56 years ago, but probably also to stay involved given his importance to the brand.

Little change at pump: An average gallon of regular in the L.A. area is $2.99 per gallon, a 2.3 cent drop from last week, according to the Auto Club.