A lot of you have probably seen the Valleywag post about LJ laying off most of its staff. I'm not going to link to it, because it's mostly wrong.
That said, LJ did lay off about half of its U.S. staff (and apparently some number of Russians earlier as well, although I don't know much about that). With, yes, no severance and basically zero notice. The main cuts seem to be in the areas of design, marketing, and management, although they also got rid of probably the last programmer they should have gotten rid of. And they definitely got rid of the worst possible designer they could have gotten rid of. (No offense to other folks in their departments who might read this.)
Does this mean the site is dying? I don't think so. I wouldn't say it's a /good/ thing, but basically from what I can tell they decided to cut out people they figured were redundant between their Russian and U.S. offices. The main problem is that they did it in a really stupid and morally dubious way. In terms of the long-term health of the company and the service? We'll see what happens in the next few months. And I really hope there's a news post about it today, because the rumors I see floating around are more destructive than anything else.
I see a lot of people on my friends list making backups of their journals. That's a good idea. Backups are always handy to have, because you never know if something will fail or your account will be hacked or who knows what. But don't be afraid LJ is going away next week. (On the other hand, if you plan to leave out of anger... well, I understand your feelings.)
ETA: Backup guides:
http://brown-betty.livejournal.com/284083.html (Windows)
http://antennapedia.livejournal.com/238132.html (Mac)
I haven't used either of these myself, but they've been recommended to me. (I use the jbackup perl script that's included with the LJ distribution, which should work for Linux users.)