| By David Evans | Wednesday, January 30th 2013, 16:29 GMT |
Next week's Rally Sweden will be a key event in the future of the timing and tracking of the World Rally Championship, with FIA rally director Jarmo Mahonen promising a conclusion after the event
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Pablo Elizalde | Wednesday, January 30th 2013, 17:11 GMT |
Christian Horner will remain as team principal of the Red Bull team after extending his contract with the outfit
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Sam Tremayne | Wednesday, January 30th 2013, 17:16 GMT |
Trevor Carlin believes motorsports governing bodies must shoulder a degree of responsibility for the current plight of British Formula 3.
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Marcus Simmons | Tuesday, January 29th 2013, 14:54 GMT |
Formula 3 aces Alex Lynn and Harry Tincknell have both said that they could be open to contesting the slimline four-round British F3 International Series this season
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Mark Glendenning | Tuesday, January 29th 2013, 18:16 GMT |
Schmidt Peterson Motorsport has completed its long-planned expansion to two cars by signing rookie Tristan Vautier alongside compatriot Simon Pagenaud for the 2013 IndyCar season
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| Tuesday, January 29th 2013, 18:33 GMT |
Porsche will return to the Superstars International Series this year, with Petri Corse entering two Panameras
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Edd Straw | Monday, January 28th 2013, 20:52 GMT |
GP2 champion Davide Valsecchi has been appointed as Lotus's third driver for the 2013 Formula 1 season
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Edd Straw | Monday, January 28th 2013, 20:03 GMT |
Lotus will run the passive DRS system that it trialled last season on the newly-launched E21.
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Matt Beer | Monday, January 28th 2013, 21:14 GMT |
Kimi Raikkonen sees no reason why he will not continue his Formula 1 return into the 2014 season
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| Sunday, January 27th 2013, 13:08 GMT |
Casey Stoner says MotoGP riders have become 'puppets' and the atmosphere in the sport would have to change substantially for him to consider going back
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Gary Watkins | Sunday, January 27th 2013, 20:56 GMT |
Chip Ganassi Racing claimed a fifth victory in its 10 years of competing at the Daytona 24 Hours after Juan Pablo Montoya came through to seal the honours in a thrilling final hour
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| Sunday, January 27th 2013, 23:12 GMT |
Patric Niederhauser will stay with Jenzer for the 2013 GP3 campaign
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
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| Saturday, January 26th 2013, 21:13 GMT |
Casey Stoner has confirmed that he will, as expected, race in the V8 Supercar Development Series with Triple 8 this year
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jamie O'Leary | Saturday, January 26th 2013, 14:15 GMT |
Max Mugelli will remain with BMW outfit Team Dinamic for this year's Superstars International Series
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Gary Watkins | Saturday, January 26th 2013, 22:05 GMT |
Chip Ganassi Racing dominated the first hour of the 51st Daytona 24 Hours on Saturday
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
Before your trip, let your bank know about your overseas travel and reduce the risk of having your credit-card account frozen.
(Money Magazine)
Here's how to get it right.
Paying for stuff
Call your bank. Before you take off, let your bank know about your trip, says Greg McBride of Bankrate.com.
Rising fraud losses have made banks more vigilant about unusual charges, he says. Unless you say something, you could end up with a disabled ATM or credit card soon after you get cash and charge your first dinner.
Hit the ATM when you must. While you should use cash sparingly, you can't avoid it altogether, so withdraw what you need from an ATM.
Related: 5 ways to get best travel deals
Yes, you'll pay a fee of a few dollars or 2% to 3% of the transaction, says Sarah Schlichter of IndependentTraveler.com. Still, your bank will use the interbank rate (a wholesale rate of exchange), so you'll also get more for your dollars than you would at a money-changing kiosk.
Favor a no-fee credit card. Pay with plastic as often as you can -- but first get a card that doesn't charge a foreign transaction fee (usually about 3% of purchases).
Capital One has long had transaction-fee-free cards, and now more issuers, including Citibank and Chase, are wiping out fees on certain premium cards. For a complete list, visit Cardhub.com.
Staying in touch
Connect using Wi-Fi. Overseas, you can run up a hefty smartphone bill before you make a single call. Blame international data rates of $20 to $25 per megabyte, says Ed Perkins of SmarterTravel.com.
"You can go through several megabytes by getting a few texts, voicemail alerts, and app updates," he says.
Put your phone in airplane mode (turning off data and calls ) and connect to e-mail and the web through local Wi-Fi networks.
Related: Creating a budget that includes travel
With a U.S.-based voice-over-IP phone number from Skype or Tango, you can also make calls via Wi-Fi for pennies a minute.
Or sign up for an international calling plan. Figuring on making lots of calls? Keep your phone on (but data off) and spring for a package instead. The plans aren't cheap, but you'll save over regular rates. AT&T, which usually charges $1.50 a minute for calls in Europe, offers 80 European minutes for $60 ($1 a minute if you go over).
Related: 7 best travel apps
Or swap your SIM card. If you've bought your smartphone in the past few years, there's a good chance it uses an electronic SIM card to store your user ID, which may give you another option. You can outfit an "unlocked" phone, or one that can use a card from any company, with a local SIM, giving you a local number and rates.
To find out if your handset is locked, call your carrier, which may be willing to unlock it if you say you're traveling. Then buy an international SIM card at a site like Telestial.com. A $19 card, for example, includes free incoming calls in more than 75 countries and 49¢-a-minute calls back to the U.S.
Buon viaggio! 
First Published: January 25, 2013: 10:50 AM ET
New home sales fell in December, but sales for 2012 were the strongest since 2009.
NEW YORK (CNNMoney)
New-home sales fell 7.3% in December from the prior month to an annual rate of 369,000, said the U.S. Census Bureau. That's compared to November's revised annual rate of 398,000 new home sales.
Last month's rate of sales was significantly lower than expectations. A consensus of economists surveyed by Briefing.com had forecast an annual rate of 385,000 new home sales.
The real estate market has been one of the stronger sectors of the economy, showing signs of recovery in recent months, after the housing bubble burst more than five years ago.
The nationwide median sales price of a new home in December climbed 1.3% to $248,900. For all of 2012 the median sales price was $243,600, up 7.2% from the prior year.
Home sales are being driven by low mortgage rates, lower unemployment and a rebound in home prices, which has prompted purchases by those who were waiting for the market to hit bottom.
The market for existing homes has also been strong. On Jan. 22, the National Association of Realtors said that December sales of previously-owned homes was down slightly from the prior month, but up 12.8% from the prior year. Existing home sales in 2012 totaled 4.65 million units, up 9% from 2011, and the strongest year since 2007.
First Published: January 25, 2013: 10:25 AM ET
NEW YORK (CNNMoney)
Leading the charge will be Paul Ryan, chairman of the House Budget Committee, who is drafting the GOP's proposed 2014 budget.
Ryan's budget last year was savaged by Democrats for its spending cuts, among other things. But even that budget, which would have slashed deficits significantly, would not have resulted in a balanced budget until close to 2040.
So how realistic is it now for Republicans to balance the budget within 10 years?
"Technically it's plausible. ... But politically it may be too much," said Rudolph Penner, a former director of the Congressional Budget Office.
One reason it may be plausible is that the House will be putting out what's called a budget resolution, which sets broad targets for spending and revenue. It's the starting point in a months-long process and doesn't require lawmakers to offer all details on how to meet those targets.
In addition, a budget resolution is based on a set of policy and economic assumptions -- and small changes to things like economic growth forecasts can make a big difference to the bottom line, Penner said.
Another reason: Ironically, given Republicans' opposition to raising taxes, Ryan's job will be made somewhat easier this year by the more than $600 billion in new revenue that will be raised thanks to the fiscal cliff deal that Congress passed over New Year's.
For instance, Ryan's budget last year would have racked up a roughly $250 billion deficit in 2022. The new revenue would reduce that to about $130 billion, according to estimates from the Committee for a Responsible Federal Budget.
A balanced budget is virtually guaranteed to be a non-starter with Democrats. Their goal is to stabilize the debt by the end of the decade. That is, reduce annual deficits enough so that total public debt remains constant as a share of the economy.
Related: House passes bill to defuse debt ceiling
Democrats are also likely to reject the House Republican budget proposal because it's likely to include more of the controversial proposals they rejected from Ryan's budget last year.
Ryan proposed lower spending levels than those set by the 2011 Budget Control Act and called for Medicare to include a premium support system starting in 2023. He also wanted to convert funding for Medicaid, food stamps and other low-income programs to block grants.
So for House Republicans to reach a balanced budget within 10 years -- and to do so only through spending cuts, since they've ruled out raising any more tax revenue -- they would have to do much more, and sooner.
It's a fair bet that health care entitlement changes will be central to the effort.
"Like most in the private sector, we want to transition from a defined benefit scenario to a defined contribution scenario. But you need to affect some real reforms in health care delivery and compensation and payment," House Majority Leader Eric Cantor told CNN's Ali Velshi this week.
One way to get to a balanced budget faster might be to enact Ryan's Medicare premium-support model in 2018, five years earlier than in his previous budget, said Marc Goldwein, senior policy director at the Committee for a Responsible Federal Budget.
Or reduce Medicare provider payments. Or raise current retirees' Medicare cost-sharing.
Or all of the above.
Independent deficit hawks aren't pushing for a balanced budget within a decade because it would require drastic changes that could hurt the economy and couldn't fully address long-term drivers of debt. At the same time, they say Democrats' goal of stabilizing the debt is only a first step. Health care costs must be brought down and entitlement programs reformed or the debt would soon start growing again.
It may be several weeks before Ryan unveils his budget. In the meantime, all eyes will be on the Congressional Budget Office, which will release its latest budget and economic outlook for the next decade on Feb. 4. That will give a much clearer sense of the magnitude of changes needed to balance the budget anytime soon.
First Published: January 25, 2013: 11:23 AM ET
NEW YORK (CNNMoney)
The Nikkei index of leading Japanese shares gained nearly 3% on Friday, ending a volatile week on a strong note. At the same time, the yen fell below ¥90 versus the U.S. dollar -- a level not seen since 2010.
The yen's sharp decline comes as investors bet the Bank of Japan will need to buy even more assets to meet its new inflation targets.
Under pressure from Prime Minister Shinzo Abe, the BoJ announced plans this week to make "open-ended" purchases of government bonds and raised its inflation target to 2% from 1%.
But inflation data released Friday highlights the challenges Japanese officials face in achieving their goals. Japan's inflation rate declined 0.1% in December from the previous month according to the nation's consumer price index.
Chris Scicluna, an economist at Daiwa Capital Markets, said the inflation rate will probably remain at or below zero for the first half of the year, and will struggle to break above 1% "for the foreseeable future."
"We fully expect the BoJ to increase again its asset purchases in due course," said Scicluna.
The 12% decline in the value of the yen since October has raised concerns about a currency war, particularly in Germany. Chancellor Angela Merkel criticized the "politicization" of Japan's monetary policy on Thursday, echoing remarks by Jens Weidmann, the top monetary official in Germany.
Japan has denied that it is deliberately trying to weaken the yen, saying the recent depreciation is part of a normal market correction.
Related: Japan spurs talk of currency war
But the nation's exporters, including major automakers Toyota (TM) and Honda (HMC), stand to benefit from a weaker yen, which makes Japanese goods more competitive on the global market.
Meanwhile, investors have been piling into Japanese stocks since December, when Abe returned to power, promising to lift the economy out of recession.
Abe quickly unveiled a $117 billion fiscal stimulus package, including increased spending on public works, disaster recovery and aid to smaller businesses.
The combination of fiscal stimulus and central bank easing has attracted the attention of investors around the world, said said Michelle Gibley, director of international research at Schwab.
"Japan is really the story in 2013," said Gibley. "The motto this year could be 'don't fight the BoJ.'"
Still, the Japanese economy faces deep structural challenges, including an aging population and a sluggish job market. In addition, Japan already has a heavy debt load and investors in the bond market may demand higher interest rates to fund Abe's stimulus program, said Gibley.
"It's unclear how long this can last," she said.
First Published: January 25, 2013: 12:26 PM ET
Seeking shelter from the possibility of falling U.S. bond values in emerging markets.
NEW YORK (Money Magazine)
I agree that most people expect that U.S. interest rates will rise in the near future. In fact, the yield on 10-year Treasury bonds has already climbed nearly a half a percentage point, moving from its July 2012 low of just over 1.4% to a bit below 1.9% recently.
But if you're looking for protection from possible setbacks in bonds, I don't see moving into emerging market bond funds as much of a solution. If anything, I see it as a potentially dangerous move.
By virtually any measure, emerging market bond funds are riskier than their U.S. counterparts.
They typically have longer durations -- a fancy way of saying their prices will fall more if interest rates rise (although that drop can be offset to some extent by their generally higher yields).
Their portfolios have a lower average credit quality, typically below investment-grade. And because still-developing economies are more vulnerable to economic, financial and currency woes of every sort, emerging market bonds are just much more volatile overall.
Emerging market bond funds' standard deviation, a statistic that measures how much an investment's returns bounce up and down, can be triple that of the broad U.S. taxable bond market.
Related: Your future self thinks you should save more
But you don't even have to sift through these kinds of indicators (which you can find in the Portfolio tab on any bond fund's Morningstar page) to see that emerging market bonds aren't a safe haven. Just look at how they fared when the financial system went haywire back in 2008. Between August and October of that year, emerging market bonds lost just over 25% of their value.
You would have also lost money during that period had you owned a total bond market index fund that holds a combination of U.S. government and corporate investment-grade bonds, but the hit would have been much more mild, roughly 3%.
I don't mean to suggest that no one should ever own emerging market bond funds. They have been one of the top-performing categories of bond funds over the past three and five years, churning out annualized returns of 11.2% and 9.4%, respectively. But the reason they generate such high returns is that these bond funds also come with outsize risk.
So while someone willing to accept that risk to juice returns might consider putting a small portion of his bond holdings in emerging market bond funds, they aren't the go-to choice if your cry is "gimme shelter."
What should you do, then, if you're worried that rising rates will trigger losses in bonds?
You have a few choices. One is to get out of bonds entirely. But that leaves you with the question of where to put the money you had in bonds. You could move it to cash, and you would get the safety you seek. But you'd earn virtually nothing, and possibly less than what you'd get in bonds if interest rates remain stable or rise only slightly.
You could switch to stocks. But downturns in the stock market are likely to dwarf any setback you would experience in bonds. So you would be taking on much more risk by going to equities, even if you shifted into dividend-paying stocks. And whether you jumped to cash or stocks, you would still face the issue of when to get back into bonds. Timing markets is always an iffy affair. There's always the chance you could return to bonds only to see rates head upwards.
Related: Get help meeting your financial goals
My recommendation: Stop trying to predict what interest rates will do and just decide what percentage of your portfolio should be in bonds based on your goals and risk tolerance. Then, aside from periodic rebalancing (or possibly increasing your bond exposure as you age), let it be.
If you want to limit the downside of rising rates, you can invest in bond funds that stick to the short- to intermediate-maturity range of the market. You'll find bond funds that do just that -- including my choice, bond index funds -- in our MONEY 70 list of recommended funds.
The bond portion of your portfolio may still very well take a hit if rates climb. But chances are it won't be a very big one (certainly not by stock-market standards) and, as this report explains, any decline should eventually be offset as the fund invests in bonds with higher yields.
So if you want to take a shot at loftier gains and you're willing to accept the higher risk that involves, by all means consider devoting a small portion of your bond stake to emerging market bond funds. But if it's shelter you seek, forget them.
First Published: January 25, 2013: 2:19 PM ET
Sylvia Mathews Burwell is the top choice to lead the White House budget office.
WASHINGTON (CNNMoney)
Burwell, 47, would be one of a growing cadre of Obama chiefs who also worked for former Treasury Secretary Robert Rubin. That club includes former Office of Management and Budget directors Peter Orszag and Jack Lew.
She currently runs the Wal-Mart Foundation, which helps fund food pantries and sustainable farming in the United States as well as economic development in Africa. It also helped Hurricane Sandy victims in the Northeast, according to press releases.
Burwell has been in that job in Bentonville, Ark., for more than a year.
The foundation budget in 2010 was $166 million, funded from Wal-Mart (WMT, Fortune 500) stores, according to a recent filing with the IRS.
The philanthropic arm of the world's biggest retailer has weathered criticism by the watchdog group the National Committee for Responsive Philanthropy, which in 2005 called its work "seemingly generous, but systematically self-interested." The group says the foundation does a better job of serving those with the least wealth and opportunity.
"It is undeniable that the philanthropy of Wal-Mart has improved substantially since 2005, and especially since the arrival of Sylvia Mathews Burwell," said Aaron Dorfman, the group's executive director. "However, Wal-Mart's philanthropy and business practices still has substantial room for improvement."
Related: Wal-Mart knew about Mexico bribery in 2005, say lawmakers
Requests for comment from Burwell and the Wal-Mart Foundation were not returned.
Burwell also spent a decade at the foundation run by Microsoft (MSFT, Fortune 500) founder Bill Gates and his wife, Melinda, eventually running the global development program there. The Gates Foundation is the nation's largest philanthropy with a $36 billion endowment.
The Gates Foundation said Burwell "designed and led the foundation's strategies to improve the lives of millions of the world's poorest people," in a November 2011 statement about her departure.
Since 2004, Burwell has also served on the board of directors of MetLife (MET, Fortune 500) and makes $260,000 in that role, according to regulatory filings.
Burwell's last stint at OMB was as its deputy director from 1998 to 2001, according to her MetLife profile. She also served as President Clinton's deputy chief of staff and Treasury Secretary Rubin's chief of staff. She was also the staff director of the National Economic Council.
The Office of Management and Budget is responsible for preparing the president's annual budget. In recent years, its directors have played a high- profile role sparring with Congress, thanks to ongoing debates over budget deficits and keeping the federal government funded.
If nominated by Obama, Burwell would need to be confirmed by the Senate. She would replace Jeffrey Zients, who has been the acting director of the OMB for one year. Zients replaced Lew, who became chief of staff in 2012. Orszag headed Obama's budget team until July 2010.
Burwell would be the first woman to run OMB since Alice Rivlin, who served under President Clinton.
Her nomination would come at a time when Obama's cabinet picks are coming under scrutiny for their perceived lack of diversity. His major nominations, including for secretaries of Defense, State and Treasury, were all white men. On Thursday he nominated a woman, Mary Jo White, to lead the Securities and Exchange Commission.
- CNN's Kevin Liptak contributed to this report.
First Published: January 25, 2013: 2:44 PM ET
Chicago Mayor Rahm Emanuel wants banks to stop lending to gun makers.
WASHINGTON (CNNMoney)
Emanuel, mayor of the nation's third-largest city and former chief of staff to President Obama, wrote the CEOs of Bank of America (BAC, Fortune 500) and TD Bank (TD), since they finance gun makers that lobby against federal and local efforts to toughen gun control laws.
Bank of America gives Sturm, Ruger & Company Inc. (RGR) a $25 million line of credit and TD Bank gives Smith & Wesson (SWHC) a $60 million line of credit, according to the letter.
"I ask you to use your influence to push this company to find common ground with the vast majority of Americans who support a military weapons and ammunition ban, and comprehensive background checks," Emanuel wrote to Bank of America CEO Brian Moynihan. He wrote a similar letter to TD Bank CEO Bharat Masrani.
Both Bank of America and TD declined to comment.
Smith & Wesson and Sturm, Ruger make a wide variety of firearms, including the semiautomatic rifles that are known variously as assault weapons or modern sporting rifles.
Related: Gun industry thrives in face of ban proposal
Emanuel pushed for tougher gun control measures long before the slayings of children and teachers at a Newtown, Conn., elementary school last month. Two years ago, the Supreme Court overturned the city's handgun ban, forcing the city to rewrite its laws. Chicago maintains some of the nation's toughest gun control laws, including registration of any kind of gun and a ban on assault weapons.
"Doing business with gun manufacturers might benefit the banks' bottom line, but they put our police officers, our children, and our communities at risk," Emanuel said in a Friday statement.
His office has also ordered city pension and retirement funds to divest shares in gun makers. This week, the Chicago Municipal Employees Annuity and Benefit Fund agreed to shift $1 million from manufacturers of assault rifles, including Freedom Group, Smith and Wesson and Sturm, Ruger.
- CNN's Todd Sperry contributed to this report.
First Published: January 25, 2013: 2:56 PM ET
Click chart for more on Apple's stock.
NEW YORK (CNNMoney)
Exactly one year after Apple (AAPL, Fortune 500) became the world's most valuable company, it lost that title to Exxon (XOM, Fortune 500) as its shares slipped to $439.88.
The precipitous decline has caused Apple's stock to drop in value by about $250 billion since hitting its all-time high of $705 in late September 2012. Since then, the stock has also tumbled more than 35%.
With its market capitalization hovering around $413 billion, Apple is now worth $5 billion less than Exxon.
Apple's stock plunged more than 12% Thursday, after the company disappointed investors with its somewhat tepid forecasts for iPhone sales. Shares of Apple continued to fall Friday, sliding more than 2%.
"It's a fire sale right now. A lot of retail investors who bought at much higher prices have panicked," said Laurence Balter, chief market strategist at Oracle Investment Research.
Still, Balter said that while individual investors may be racing out of the stock, mutual funds and other so-called institutional investors have been buyers over the past several days.
Related: What Apple's earnings really mean
With the recent decline, Apple is a relative bargain, trading at nearly 10 times earnings estimates, down from a PE of 15 when the stock was at its highest point. Compare that to Google (GOOG, Fortune 500), which currently trades at 16 times its expected 2013 earnings.
A slew of analysts swiftly downgraded Apple's stock after the company's disappointing iPhone sales outlook. That's not helping the stock much.
CNNMoney's Hibah Yousuf contributed to this report.
First Published: January 25, 2013: 12:22 PM ET
Boeing hasn't slowed production of its 787 Dreamliner despite the federal probe that has grounded the jet.
NEW YORK (CNNMoney)
A federal probe into electrical fires has grounded all 50 Boeing 787 Dreamliners around the world. But Boeing has little choice but to keep its assembly lines in South Carolina and Washington State running at their normal pace, building five jets a month. A significant slowdown in production, let alone a full shutdown, would be too costly for both Boeing and its suppliers who are counting on making parts for the aircraft.
"Stopping production is not going to happen," said Carter Leake, an aerospace analyst with BB&T Capital Markets. A halt in production or even a slow down would risk crucial suppliers going out of business. "They need to keep the lines running to support the supply chain. They can't do that to suppliers that barely survived the three year delay in producing the first plane."
National Transportation Safety Board Chairman Deborah Hersman said Thursday that investigators have yet to determine what caused the two lithium battery fires earlier this month that led the FAA to ground all Dreamliners. So even though Boeing has no idea what kind of fix to the aircraft will eventually be required, it continues to make the planes as if there is no problem.
Related: What's wrong with the Dreamliner?
"If it stopped it would be very difficult to start production again," said Chris DeNicolo, aerospace credit analyst for Standard & Poor's. And Boeing still has 800 Dreamliner orders left to fill for airlines.
Related: Dreamliner - Where the parts come from
Boeing spokeswoman Kate Bergman confirms the manufacturer hasn't changed its production schedule since the Dreamliners were grounded. Indeed, the manufacturer still plans to double production by year's end. The company would not say how many planes have been built since the FAA grounded the jets on Jan. 16, or what it will do with the completed aircraft since it can't fly them off Boeing's property.
NTSB's Hersman said the probe is only in the very early stages and suggested it could take a long time to resolve.
"This is not something we expect will be solved overnight," she said. "We are prepared to be methodical."
Related: United: Passengers will 'flock' back to Dreamliner
Leake said he is worried that the relatively quick fix that many investors were hoping for is becoming less and less likely. Airlines eager for the jet's improved fuel economy have yet to cancel any orders due to the grounding. But that won't necessarily be the case forever.
"It does sound like we're in the first inning," Leake said. "I don't know what the tipping point is. If it's three months, they'll be no cancellations, six months, some cancellations, Nine months, it's a big problem."
Working in Boeing's favor is the fact that it has more than $11 billion in cash and short-term investments on its balance sheet.
"There's an ability [for it] to absorb the additional costs," said DeNicolo. "The rest of its commercial airplane business is doing quite well."
The Dreamliner was supposed to be a major profit driver for Boeing, but that won't be the case as long as it's building planes that it can't deliver.
First Published: January 25, 2013: 4:44 PM ET
NEW YORK (CNNMoney)
It's RIM's (RIMM) first-ever Super Bowl commercial, and while the company didn't say how much it spent, Super Bowl broadcaster CBS (CBS, Fortune 500) previously told CNNMoney that 30-second spots are going for a record high of at least $4 million.
RIM will unveil the BlackBerry 10 platform at events on Wednesday, as well as the first two devices to run on the new platform. It's been a long time coming: The software had previously been slated for release in early 2012, which was pushed to late 2012, and again to the first quarter of 2013.
While delays in tech do happen, the news was damning for the struggling RIM because BlackBerry 10 is meant t to be the crown jewel of the company's turnaround plan. Critics wondered if RIM would even survive long enough to launch the OS.
Now that launch day is nearly upon us, RIM is doing all it can to market BlackBerry 10. In addition to the Super Bowl ad, RIM said it will push BlackBerry via online ads and on social networks before and after the game. Launch day on Wednesday includes BlackBerry events around the globe.
Related story: RIM's fate hangs on BlackBerry 10
So RIM will survive to see BlackBerry 10 launch, but the delay has left the company stuck in a holding pattern. Everyone from Apple (AAPL, Fortune 500) to Nokia (NOK) to Microsoft (MSFT, Fortune 500) released new gadgets in the fall, but RIM was essentially forced to wait for the BlackBerry 10 software before selling any significant new hardware.
The company has said BlackBerry 10 will run on a smaller number of devices with essential smartphone features: a much-improved camera, a modern Web browser and social-networking integration. The software will allow customers to access e-mail with one swipe from any app, and it will shift automatically between personal and corporate modes.
RIM's main problem is its lost stronghold in the corporate market, where it once dominated. Rather than issuing company BlackBerries, many employers now have workers bring their own devices into work, usually Apple's (AAPL, Fortune 500) iPhone and Google's (GOOG, Fortune 500) Android devices.
First Published: January 25, 2013: 5:32 PM ET
| By Jonathan Noble | Friday, January 25th 2013, 17:09 GMT |
Marussia sporting director Graeme Lowdon says his outfit can still look forward to the new season with some confidence, despite having had to take the tough decision to end its contract with Timo Glock.
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jamie O'Leary | Friday, January 25th 2013, 17:21 GMT |
Jake Rosenzweig has completed the Addax line-up for this year's GP2 Series.
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
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| By David Evans | Friday, January 25th 2013, 17:57 GMT |
This year's Acropolis Rally has undergone significant changes and will feature a night stage in its itinerary.
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Matt Beer | Thursday, January 24th 2013, 17:16 GMT |
Robert Kubica said his DTM test with Mercedes posed no physical problems at all.
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| By Matt Beer | Thursday, January 24th 2013, 17:58 GMT |
Formula 1 refugee Timo Glock felt he settled in quickly as he made his DTM testing debut with BMW at Valencia on Thursday
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Gary Watkins | Thursday, January 24th 2013, 22:12 GMT |
Chip Ganassi Racing blocked out the front row for this weekend's Daytona 24 Hours
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Matt Beer | Wednesday, January 23rd 2013, 16:45 GMT |
Ken Block intends to contest a three-round World Rally Championship programme again in 2013
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Sam Tremayne | Wednesday, January 23rd 2013, 17:34 GMT |
MotoGP will trial its new spec ECU system in a special two-day test at Sepang on 3-4 February.
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Matt Beer | Wednesday, January 23rd 2013, 17:36 GMT |
Lotus has chosen to launch its 2013 Formula 1 car, the E21, online
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| By Jamie O'Leary | Tuesday, January 22nd 2013, 14:26 GMT |
Raffaele Marciello will, as expected, remain with Prema Powerteam for this year's European Formula 3 championship
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Matt Beer | Tuesday, January 22nd 2013, 13:41 GMT |
Robert Kubica is not yet physically ready to test a Formula 1 car, according to Mercedes boss Toto Wolff, whose company is giving Kubica a DTM run this week
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Matt Beer | Tuesday, January 22nd 2013, 16:04 GMT |
MotoGP returnee Hiroshi Aoyama has sustained a fractured wrist in a motocross accident
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| Monday, January 21st 2013, 22:41 GMT |
Lewis Hamilton says the 'incredible determination' of his new Mercedes team spurred him through the winter after his first meeting with his 2013 crew before Christmas
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| Monday, January 21st 2013, 23:02 GMT |
The IndyCar Series has altered the heat qualifying system for its Iowa Speedway round, lengthening the races, offering points and allowing drivers from opening heats to progress to the pole-deciding final
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| Monday, January 21st 2013, 23:12 GMT |
Ducati was frustrated by rain at Jerez as it tried to get three days of running in ahead of next month's first official MotoGP test of the year at Sepang
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By David Evans | Sunday, January 20th 2013, 15:04 GMT |
Sebastien Ogier has admitted his second place on the Monte Carlo Rally was as good as a win for the all-new Volkswagen Polo R WRC.
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jonathan Noble and Jamie O'Leary | Sunday, January 20th 2013, 18:44 GMT |
Toto Wolff is set to take a senior role in the management of Mercedes-Benz's motorsport activities, senior sources close the German car manufacturer have revealed to AUTOSPORT.
You have viewed over 30 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jamie O'Leary | Sunday, January 20th 2013, 21:39 GMT |
Andy Priaulx will make his Daytona 24 Hours debut next weekend, driving a BMW in the GT class of the famous race
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| Saturday, January 19th 2013, 20:18 GMT |
Stephane Peterhansel clinched his 11th Dakar Rally victory with a calm run to the finish in Santiago on Saturday
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| Saturday, January 19th 2013, 20:44 GMT |
NASCAR Sprint Cup organisers are optimistic that the new Gen-6 car will deliver better racing than its predecessor following pre-season testing
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Subscribe to Premier Sports TV to watch all Sprint Cup events live in the UK. Visit www.premiersports.tv for more information.
| Saturday, January 19th 2013, 21:00 GMT |
NASCAR driver Michael Waltrip's GT team is unlikely to be seen in Europe and the World Endurance Championship this season
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NEW YORK (CNNMoney)
The more than 1,300 pages offer the most comprehensive look at the Federal Reserve's deliberations, leading up to the start of the Great Recession in December 2007. It's the central bank's policy to release full transcripts with a five year lag.
Here's how the year played out. (For the full transcripts, click here.)
January 2007: Calm before the storm
At the beginning of the year, many Fed officials, including Chairman Ben Bernanke, thought one of the biggest risks was that the economy might grow stronger than expected.
At the time, the Fed's key interest rate was at 5.25%, and the central bank was leaning toward raising it further, rather than easing monetary policy.
"My recommendation also is to take no action and to maintain a bias toward further tightening," Bernanke said at the first meeting of the year, noting that inflation risk had picked up and the housing market had shown some improvement after slumping in 2006.
"The housing market has looked a bit more solid, and the worst outcomes have been made less likely," he said.
At that point, they didn't realize that losses from subprime mortgages would ignite the deepest financial crisis since the Great Depression.
Fast forward two months, and still, the Fed thought the worst was over for the housing sector.
"The central scenario that housing will stabilize sometime during the middle of the year remains intact," Bernanke said at a meeting in March, adding later, "The effects of the decline in subprime lending may have already been mostly seen, since that has slowed from last fall."
June 2007: Tip of the iceberg
As it turns out, that spring was merely the calm before the storm. In June, two Bear Stearns hedge funds that had large holdings of subprime mortgages suffered huge losses and were forced to dump their assets.
Fed officials discussed the news at their meeting a week later, but they largely agreed that aside from housing, the economy still looked strong.
"Significant spillovers have yet to emerge from the housing situation, and other components of demand appear to be strengthening and thereby offsetting the drag from residential construction," Bernanke said.
San Francisco Fed President Janet Yellen, however, sounded the loudest warning.
"In terms of risks to the outlook for growth, I still feel the presence of a 600-pound gorilla in the room, and that is the housing sector," she said. "The risk for further significant deterioration in the housing market, with house prices falling and mortgage delinquencies rising further, causes me appreciable angst."
August 2007: It hits the fan
Fed officials didn't meet again until August 7, and even then, some thought higher inflation was one of the biggest concerns. The theory was that if the housing market weakened, rents would rise and thereby drive up inflation.
Meanwhile, New York Fed President William Dudley reported that for the most part, Bear Stearns' problems did not pose a substantial risk to the economy.
"We've done quite a bit of work trying to identify some of the funding questions surrounding Bear Stearns, Countrywide, and some of the commercial paper programs," he said. "There is some strain, but so far it looks as though nothing is really imminent in those areas."
Again, Yellen said the housing market caused her "appreciable angst."
Bernanke largely disregarded that a financial crisis would take place, but also said he believed the central bank could handle it.
"We are prepared to use the tools that we have to address a short-term financial crisis, should one occur," he said.
"I think the odds are that the market will stabilize," he added later.
The Fed left its policy unchanged at that meeting. That was a Tuesday, and over the next few days, stocks plunged as more financial institutions reported problems related to bad loans.
On Friday, the Fed held an unscheduled conference call and decided to inject $38 billion into the U.S. banking system.
Less than a week later, it held another emergency conference call and decided to cut the discount rate -- the rate it charges qualified lenders, mainly banks, for temporary loans.
September 2007: The rate cuts begin
The central bank meets and starts cutting the federal funds rate, the key interest rate that impacts everything from mortgages to car loans to credit cards. But the Fed still errs on the side of caution, as some officials warn that they could be overestimating the severity of the downturn.
"As the central bank we have a responsibility to help markets function normally and to promote economic stability broadly speaking," Bernanke said. "We are not in the business of bailing out individuals or businesses."
Fed officials meet two more times and hold another unscheduled conference call. By the end of the year, the federal funds rate is down to 4.25%.
At the last meeting of the year, Yellen said these prophetic words:
"I believe that the most likely outcome is for the economy to slow significantly in the near-term, flirting with recession," she said.
Little did they know then, the recession had only just begun.
First Published: January 18, 2013: 4:16 PM ET
Industrial output and exports helped drive China's growth in the fourth quarter
LONDON (CNNMoney)
Gross domestic product grew by 7.8% for the year as a whole, beating the government's target of 7.5% and analyst expectations, as a recovery in industrial production and exports drove an acceleration in growth in the fourth quarter.
Quarterly growth of 7.9% was slightly better than most economists were expecting, and ended a slowdown that had lasted for much of the past two years. Third-quarter growth was at a 7.4% annual rate.
"The upside surprise in China's fourth-quarter GDP data confirmed that the economy has officially exited its slowdown," HSBC economists wrote in a note.
China has averaged growth of around 10% a year in the past three decades, propelling it up the list of biggest economies, generating wealth for its growing middle class and boosting global trade.
"I think some of the pessimism about the Chinese economy was overdone at the end of last year," Australian finance minister Wayne Swan told CNN. "The Chinese economy will contribute significantly to global growth as we go through this year."
Related: China will be Apple's top market
But recently, China has felt the impact of sluggish growth in the United States and recession in much of Europe, which has depressed export demand. Government efforts to take the heat out of a real estate boom and control inflation have also had a dampening effect.
China's new leadership -- due to take over in March -- is looking to rebalance the economy, placing greater emphasis on consumption and reducing the country's reliance on investment in infrastructure, manufacturing and real estate.
Economists said the GDP numbers suggested China was on track for a steady but modest recovery in 2013, with inflation rising but still manageable. Some see evidence that more balanced growth is already being achieved.
"Our view has been that the rebalancing of the Chinese economy is already underway," analysts at Barclays wrote in a note. "We expected consumption's share of GDP to pick up gradually, as consumption growth continues to outpace real GDP growth, as happened in 2012."
A gradual recovery would create a favorable backdrop for incoming President Xi Jinping and Premier Li Keqiang to pursue further reforms of China's economy.
But risks to the outlook remain. Some experts believe growth could tail off again in the second half of next year, pointing to signs of weakness in investment and the possibility that rising inflation will prompt a tightening of monetary policy.
-- CNN's Oliver Joy contributed to this article
First Published: January 18, 2013: 7:19 AM ET
Lee Tillett, a makeup artist based in Florida, is one of two businesses fighting the Kardashian sisters for the rights to use the name Kroma for her company.
NEW YORK (CNNMoney)
Just ask the entrepreneurs behind Chroma and Kroma.
These two tiny and unrelated makeup companies are on opposite sides of the country. But they're now both engaged in a legal battle to stop the Kardashian sisters from selling makeup under a similar name: Khroma.
Spell it however you want -- Kroma, Chroma, KhrÅma -- it simply means "color" in Greek. That naturally makes it a go-to name for any company in the makeup business, yet both small businesses are fighting to keep the Kardashians away from it.
Their worry? That the Kardashian line will quickly gain popularity and confuse customers. If it waters down their exclusive brands, it will cost them potential clients.
Related: Inside Herbalife. Is it a pyramid scheme?
The owners of Chroma Makeup Studio in Beverly Hills also fear that their plans to expand and develop a major retail line have been destroyed.
"It kills any possibility of ever going into a department store," said co-owner Michael Rey III. "The global reach of the Kardashians and their ability to flood the market took the name. Our Chroma is lost. Anytime a client mentions Chroma, they'll say, 'Kardashian Khroma?'"
Indeed, the Kardashian line is already being sold at CVS, K-Mart, Sears and Ulta stores, offering Kim Kardashian's "legendary nude lip look" with a $14.99 lip pencil. Her long eyelashes are only a stroke of $9.99 mascara away.
The idea of renaming their business after 12 years -- and building another brand from scratch -- was too much to bear for Rey and his business partner, Lisa Casino. They chose to fight in court instead, suing the Kardashians' licensing company on Nov. 19 and claiming trademark infringement.
The Beverly Hills studio hopes to enforce common law trademark rights, which protect a product that's already been sold under a given name. The Kardashians' licensing company, Boldface, is fighting back for the right to use the name Khroma Beauty.
When asked about the legal dispute, Boldface CEO Nicole Ostoya said in a statement, "We do not believe that there is any likelihood of confusion between Khroma Beauty... and any other entity."
It's a similar issue for Lee Tillett, a makeup artist who runs her Kroma cosmetics line just outside Orlando, Fla. She's had her line of "all-natural botanical formulas" since 2004 and said the confusion with the Kardashian brand "could be potentially catastrophic" for her business.
Tillett took legal steps to protect her brand name long before the Kardashians ever developed theirs. In 2010, she applied to register Kroma with the U.S. Patent and Trademark Office. The trademark was granted early last year.
That came to play a major role last year, when the Kardashians' licensing company tried to trademark their version, Khroma. Federal officials refused their application in September, citing "a likelihood of confusion" with Tillett's Kroma.
But that wasn't enough to stop the Kim, Khloe and Kourtney Kardashian from launching their product line late last year.
"I had taken all the proper steps and legally registered the Kroma name," Tillett said by email. "I was shocked that after all that, someone would just try to grab it away from me."
Related: Doctors looking for an out
Talks between Tillett and the Kardashians' licensing company, Boldface, went nowhere. On Nov. 30, Boldface sued Tillett's company, asking for a judge to let them use the name Khroma.
Just last week, Tillett sued the Kardashians back, demanding $10 million in damages.
Now all three are in federal court fighting for a name that, at least phonetically, is used by 205 businesses listed in the online small business community Manta.
First Published: January 18, 2013: 8:13 AM ET
NEW YORK (CNNMoney)
Sony (SNE) stock was up 5.5% on the news in morning trading, but it has been lagging other media companies recently, such as News Corp. (NWSA, Fortune 500), Walt Disney (DIS, Fortune 500), Comcast (CMCSA), CBS (CBS, Fortune 500), and CNNMoney parent Time Warner (TWX, Fortune 500). All those companies are up more than 35% since the start of 2012, while Sony's shares, even with Friday's rise, have lost 30% of their value in that time. Sony's debt was cut to junk bond status late last year by rating agency Fitch.
Sony shares have also lagged behind personal electronics competitors such as Apple (AAPL, Fortune 500), which despite losing ground in recent months is still up more than 23% since the start of 2012.
The building at 550 Madison Avenue in Manhattan is the home to Sony Corporation of America as well as Sony Music Entertainment, Sony/ATV Music Publishing and Sony Pictures Entertainment, among other units of the company. The company will continue to stay at the location for at least three years under terms of the sale.
Related: Sony Music's Bob Dylan copyright disaster
The building, known for its distinctive notched roof, is being purchased by a consortium led by The Chetrit Group, a New York-based owner of commercial properties. Sony expects to post a $685 million net gain on the sale.
First Published: January 18, 2013: 11:14 AM ET
Boeing assembles its 787 Dreamliners in Everett, Wash. (above) or North Charleston, S.C.
NEW YORK (CNNMoney)
As many as 45 big companies are involved in building the main components -- the fuselage, engine, airframe, bulkhead and tires -- of the $200 million 787 Dreamliner, according to Boeing (BA, Fortune 500).
And when you account for subcontractors that supply nuts and bolts, electronics and software for the aircraft, the total number of suppliers could be well over a hundred, estimates Richard Aboulafia, aviation analyst and vice president with Teal Group Corp., an industry consulting firm.
The Dreamliner is Boeing's first jetliner whose primary structures -- body and wings -- are built with lightweight composite materials such as graphite, titanium and carbon fiber rather than traditional metals, Aboulafia said.
"This makes the aircraft lighter and more efficent than previous models," he said.
Another big difference, he said, is that the Dreamliner uses mostly electrical power rather than pneumatics to control the aircraft. That power system uses lithium-ion batteries, which are at the center of this week's grounding.
Related Story: Dreamliners grounded globally due to fire risk
The Dreamliner is assembled at Boeing's two facilities in Everett, Wash., and North Charleston, S.C.
But its parts come from around the world. About 70% are supplied by American companies and 30% are outsourced, said Boeing spokesman Larry Wilson, which is about the same ratio as similar Boeing aircraft. Wilson declined to provide the exact dollar value of parts.
Among its major American suppliers are Iowa-based Rockwell Collins (COL, Fortune 500), which makes the Dreamliner's communications and pilot control systems; Kansas-based Spirit AeroSystems Holdings, which provides the fuselage parts; General Electric (GE, Fortune 500), which produces the engines; and Honeywell (HON, Fortune 500), which supplies the navigation systems and flight control electronics.
Related Story: What you need to know about the Boeing Dreamliner
Many of the Dreamliner's other suppliers are based overseas in countries including Japan, Italy, Korea, Germany, the United Kingdom, Sweden and France.
For example, Italian firm Alenia Aeronautica makes the center fuselage, French firm Messier-Dowty makes the aircraft's landing-gear system, German firm Diehl Luftfahrt Elektronik supplies the main cabin lighting, Swedish firm Saab Aerostructures manufactures the access doors and and Japanese company Jamco makes parts for the lavatories, flight deck interiors and galleys.
French firm Thales makes the Dreamliner's electrical power conversion system. Thales selected GS Yuasa, a Japanese firm, in 2005 to supply it with the system's lithium-ion batteries.
Boeing's vendors likely picked the higher-energy, lighter-weight lithium ion batteries -- the same type found in mobile phones and laptops -- to make the Dreamliner's unique electrical architecture function more efficiently, said Aboulafia.
Aviation authorities worldwide ordered airlines to stop flying Boeing's 787 Dreamliner over fire risk associated with battery failures aboard the aircraft.
First Published: January 18, 2013: 11:46 AM ET
