Los Angeles is a city in mourning. And by that we mean Los Angeles is a city with dollar-signs spinning in its neon eyeballs, thanking its lucky stars on the Hollywood Walk of Fame for the Celebrity Death of the Century. What with the housing market and the Dow Jones and the unemployment figures, it couldn’t have come at a better time.

With only three days to go before the Funeral To End All Funerals — or the Memorial To End All Memorials, as it might more accurately be called — this city has suddenly found itself the direct recipient of what can only be termed the 2009 Michael Jackson Stimulus Package.

And just how stimulating is Tuesday’s $25-per-head deathapalooza at the Staples Centre going to be? “It’s going to be huge. Massive,” promises Brian Oxman, one of the singer’s less publicity-shy former lawyers.

In fact, up to a million people from across the globe are already supposedly on their way. Tuesday was chosen as the date, because on Wednesday the venue had already been booked — by a circus, of all things.

The money generated by all this will be staggering. Think of the flowers that will have to be shipped in. Think of the hot dogs that will have to be eaten. Think of the novelty bobble-heads that will have to be purchased. More than any of that, think of all those hourly lawyers’ and publicists’ fees that will have to be billed, and the new Mercedes AMGs and Viking kitchen appliances that will undoubtedly be purchased once the cheques have cleared.

To see what’s happening to this city all you need to do is elbow your way through the crowds on Hollywood Boulevard: Jackson has done for LA what TARP (troubled asset relief programme) did for Wall Street. A fortnight ago the place was half empty. Now it’s a zoo. Jackson impersonators are on every corner. Thriller is blaring from every bursting-at-the-the-seams tourist emporium. And the queue for the StarLine tour, which will take you (via open-topped bus) to the points of historical interest in Michael Jackson’s life, is snaking around the block.

The frenzy is such that many well-wishers ended up laying flowers at the wrong star on the Walk of Fame last weekend — they didn’t realise that there are, or were, two Michael Jacksons, one of them a radio talk-show host born in Britain — and that the other one’s star had been covered up by red carpet for the premier of Brüno, the new Sacha Baron Cohen film.

But it’s all good for business.

You can only imagine the guilty smiles in the boardroom of Merlin Entertainments Group, which at the height of the housing bubble bought Madame Tussauds for £1 billion and then proceeded to build a multilevel, 44,000 sq ft museum next to Grauman’s Chinese Theatre — just in time for the world’s economy to collapse. It is due to open in three weeks. And thanks to Jackomania it might actually end up paying for itself. LA hasn’t been on people’s minds so much since Paris Hilton went to jail.

Every day this week Anderson Cooper — the matinee idol of America’s cable news business — has been broadcasting on the roof of the CNN building, posing in golden sunlight against the backdrop of the Hollywood sign. A city can’t buy that kind of advertising. Especially not LA, which has been so ravaged by the economy that it can barely afford to keep the traffic lights switched on at night.

But the real financial beneficiaries of Jackson’s death have yet to be decided. For now, the talk from his family, friends and lawyers might be about toxicology reports and child custody arrangements, but the issue with perhaps the most lasting consequences will be the place of Jackson’s burial — which will undoubtedly become a Disneyland-style franchise that will generate vast sums of money, every day, of every year, in perpetuity. While the sideshow of the Staples Centre memorial goes on, this is what the real power-brokers of LA will be talking about.

Neverland is the natural choice. Jackson’s brother, Jermaine, has made it clear that this is his first choice — although it is doubtful how much clout he has within the clan. He told a cable news channel on Thursday night: “I really feel this is where he should be rested because it’s him. It’s serene.” For the most part, tourism experts agree. Roger Brooks, CEO of Destination Development International, said: “Neverland embodied who Michael Jackson was — the good and the bad. I think it could draw about one million visitors a year.” He added that Neverland clearly had the capacity for a such a role because it was significantly bigger than Graceland, the former home of Elvis Presley in Memphis that for years has operated successfully as a multimillion-dollar cash machine.

But turning Neverland into a mini-Disneyland would have profound consequences for the rustic wine country of the Santa Ynez Valley that surrounds it — as the hundreds of journalists who attempted to book hotel rooms in the nearby town of Los Olivos discovered.

Put simply, there aren’t any hotel rooms. And the hotels and yuppie B&Bs that do exist in the surrounding towns of Solvang and Buellton sold out within hours of rumours emerging that a wake would be held up there this weekend.

Another problem: Neverland, which is three hours away from LA, isn’t even accessible via a fully paved road. It’s halfway up a dirt track in a bear reserve — which presumably helped to keep paparazzi away. For a million people to go there every year would at the very least require a new two-lane highway to be built.

Added to that, Neverland has also been stripped bare because of Jackson’s financial problems before his death. “We removed everything — the gates, the fireplaces, the chandeliers,” says Darren Julien, who was hired by the singer to help to organise an auction of his possessions. It’s not clear who now owns all the stuff, or if the new operators of Neverland would have to buy it back. Given all this, it was no surprise when the Jackson family cancelled the public wake that was supposed to be held at Neverland this weekend.

But what now? There are two obvious places for Jackson to be buried in LA. First is the Hollywood Forever Cemetery, on Santa Monica Boulevard by the 101-freeway, which was satirised by the British novelist Evelyn Waugh in his 1948 novel The Loved One. If only Waugh could see the place now. If enough money changes hands you can create a tomb that resembles Superman’s Fortress of Solitude. With the resources of the Jackson estate involved the mind boggles at what could be achieved.

But a more likely resting place is LA’s other great resting place: the Forest Lawn Memorial Park, on the valley side of the Hollywood Hills, overlooking Warner Bros studios. No other funeral home — not even Hollywood Forever — is quite as skilled in the industry of death, and out-of-town visitors could easily be catered for and accommodated by the vast Universal Studios complex only a few blocks away.

Forest Lawn’s motto: “Celebrate a Life”. It even comes with an asterisk, reminding you that it’s a trademark.

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