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Toyota executives told lawmakers Tuesday that its U.S. and Canadian divisions will have more authority to decide when to issue a recall as the automaker faces mounting pressure from Washington over its recent safety problems.

Toyota has recalled millions of vehicles worldwide for problems related to sudden acceleration, which have been blamed for several accidents resulting in injuries and death. The automaker has repeatedly apologized for the lapses in quality control and Toyota technicians are working extended hours to repair the recalled vehicles.

Under new plans to improve quality control, Toyota’s North American operations "will have more autonomy and decision-making power with regard to recall and other safety issues," Yoshimi Inaba, president and chief operating officer of Toyota North America, said in testimony before the Senate Commerce Committee.

Inaba also announced that Rodney Slater, a former U.S. Transportation Secretary, will head a "blue ribbon" panel to review Toyota’s own investigation into its global operations.

Toyota came under fire last week during two separate House hearings for the automaker’s management structure, which some lawmakers said gives Japanese executives too much power over U.S. operations.

"For the future, our U.S. staff will have a clear decision-making role," Shinichi Sasaki, executive vice president at Toyota Motor in charge of quality assurance and customer service, told the committee. "Ultimately, our goal is for the United States to have an even greater voice in decisions on recalls and other safety and satisfaction issues."

In response to questioning, Sasaki acknowledged that Toyota’s North American management were not included in the recall decision-making process in the past. Speaking through a translator, he said that this policy may have caused "some concern or suspicion."

He said Toyota will deploy the new system immediately should the company issue another recall.

Questions unresolved

At the conclusion of the hearing, Sen. Jay Rockefeller, D-W.Va., the committee’s chairman, said key questions remain unanswered about Toyota’s safety record.

"We feel some frustration in trying to communicate or effort to get to the bottom of some of the questions," he said, adding that the frustration was due in part to the language barrier.

"It’s the question of accountability," the senator said. "I think there is more knowledge at the table than has disclosed itself."

Rockefeller also pledged to work on "comprehensive legislation" aimed at improving how the government regulates the auto industry. "The American people deserve a top-to-bottom review, not just on past errors, but on the road ahead," he said.

He said Congress should consider, among other things, making brake override systems mandatory for all automakers and require senior executives to legally certify information submitted to safety regulators.

Since 2000, there have been 43 complaints of fatal incidents that allegedly involve sudden acceleration in Toyota vehicles, according to the National Highway Transportation Safety Administration.

While those complaints have not yet been confirmed, the reported incidents involve 52 fatalities and 38 injuries, NHTSA said.

The sudden acceleration issue has been in the spotlight since it was disclosed last month that an accident involving a Toyota vehicle killed four people in San Diego last August free credit scores.

That accident sparked the recall of millions of Toyota vehicles for problems with floor mats that could cause accelerator pedals to become trapped. Toyota has subsequently recalled millions more cars for "sticky" accelerator pedals.

"It’s clear that somewhere along the way, public safety took a back seat to corporate profits," Rockefeller said.

Akio Toyoda, the company’s president, acknowledged last week that Toyota’s rapid growth over the last few years has contributed to the recent safety problems.

Concern about electronics

However, some lawmakers and outside researchers have suggested that sudden acceleration in Toyota vehicles could also be caused by defects in its electronic throttle control system (ETCS).

Toyota maintains that electronics are not to blame for sudden acceleration.

"As a result of our extensive testing, we do not believe sudden unintended acceleration because of a defect in our ETCS has ever happened," Uchiyamada said. "However, will continue to search for any event in which such a failure could occur."

LaHood said NHTSA is conducting a review of the electronic throttle control system in Toyota vehicles. He also said the Transportation Department may recommend that all cars sold in the United States come equipped with a brake override system.

Lawmakers criticized NHTSA for failing to respond sufficiently to reports of sudden acceleration dating back several years. "The public’s trust has been compromised and the system has broken down," Rockefeller said.

LaHood, who was named Transportation Secretary in January 2009, defended his agency.

"NHTSA has a very aggressive enforcement program," he said. "We stand ready to ensure prompt action on any additional defects that we have reason to believe are present."

Clarence Ditlow, executive director of the Center for Auto Safety, told the committee that regulators need to enact radical reform and that lawmakers should provide additional resources to ensure effective oversight.

"The government has to totally revamp its investigatory system," said the Center for Auto Safety’s Ditlow. "It has to realize that it’s the cop on the beat, not Mr. Nice Guy."

Toyota has also come under fire for a 2009 memo in which staffers boasted of the company saving $100 million by negotiating with U.S. regulators for a limited recall for certain cars.

In response to a question about the 2009 report, David Strickland, NHTSA’s administrator, denied that the agency has shown Toyota any preferential treatment.

"The claims that Toyota made about negotiating or influences are false," he said. "That document has no foundation."

Inaba, whose name appeared on the document, said it was prepared before he rejoined the company and was inconsistent with Toyota’s "guiding principle."  

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France’s trade deficit narrowed 22 percent last year on lower energy costs and as companies such as Airbus SAS boosted exports after the worst recession since World War II.

The trade gap fell to 43 billion euros ($58.9 billion) from 55.1 billion euros in 2008, the customs department in Paris said today in an e-mailed report. December’s deficit was 4.27 billion euros compared with 5.3 billion euros the previous month.

France’s performance “is due to our specialization in sectors that were less affected by the crisis: pharmaceuticals, airplanes and agriculture,” Trade Minister Anne-Marie Idrac told a Paris press conference today. The decline in the trade gap was also due to a “smaller energy deficit,” she said.

France and neighboring Germany have benefited since the second quarter of last year as global demand for their goods helped fuel the recovery. The French economy expanded 0.3 percent in the last two quarters of 2009 and will grow 1.4 percent this year, the government forecast last month.

The euro-region “recovery will be to a large extent export-led,” said Stephane Deo, an economist at UBS Securities in London. “Trade will indeed support growth this year.”

Exports of Airbus aircraft last year rose 2 percent from 2008 to reach “their highest level” for a total of 16 billion euros, today’s report showed.

Overall, French exports were little changed in December after growing 5 percent in November, according to the report.

“In 2010, French exports should benefit from a rebound in economic activity as well as from structural reforms this government has carried out,” such as cutting some business taxes and providing tax credits for research, Idrac said.

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Oracle Corp. President Charles Phillips admitted Friday to an affair first exposed on pricey billboards plastered throughout New York’s Times Square, San Francisco and Atlanta.

The supersize ads feature him and his mistress, beaming and canoodling. A Web address listed on the billboards, charlesphillipsandyavaughniewilkins.com, directed viewers to a site, which is no longer running, filled with photos and notes documenting a romance dating back to 2001.

"I had an 8½-year serious relationship with YaVaughnie Wilkins," Phillips said in a statement released Friday by Oracle’s public relations team. "My divorce proceedings began in 2008. The relationship with Ms. Wilkins has since ended, and we both wish each other well."

Phillips, 50, is reportedly still married to his wife Karen, and the two have a son together.

Wilkins declined to speak directly to the media, instead fielding requests through her cousin Misha Davila, who told CNN that Wilkins thought Phillips’ divorce was finalized in 2003.

Last summer, Davila said Wilkins received an anonymous e-mail tip about Phillips’ marital status. She hired and private investigator, and after learning Phillips was still married, ended the relationship last October payday loans in one hour.

Davila said Wilkins created the Web site, which apparently launched in October, as a gift from Wilkins for Phillips’ 50th birthday. She said the billboards were an attempt by Wilkins to reclaim her version of her relationship with Phillips– not an act of revenge.

Phillips, who has served on President Obama’s economic recovery advisory board since last February, joined Oracle (ORCL, Fortune 500) in 2003. Prior to joining the business software giant, he worked as a tech industry analyst at Morgan Stanley and served as a captain in the U.S. Marine Corps.

Often talked of as a potential successor to Oracle founder and CEO Larry Ellison, Phillips is one of the software company’s most senior — and highly paid — excecutives. On top of an $800,000 salary for 2009, he took home stock options and other compensation valued by Oracle at more than $18 million.

–CNN’s Mythili Rao contributed to this article. 

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As Porter Airlines breezes into its fourth year of operations, president Robert Deluce says the upstart airline will unveil a new, five-year business plan in 2010.

"(The new plan) is likely to see some significant growth attached to it," Deluce told the Star. "I think we’ve got lots of growth potential in the next several years."

Deluce was coy about details for his updated business plan, but conceded the original blueprint for his company has evolved somewhat since the airline set up shop in 2006. Originally, Deluce’s business plan outlined a vision of 17 flight destinations for Porter in Canada and the United States.

"A couple of the destinations that we’re already serving, Halifax and (Mont) Tremblant, weren’t even on our original business plan," Deluce said.

"I think at some point in time we’ll be serving at least 17 destinations, and maybe more."

The airline has already announced a number of changes for the first quarter of 2010. Its fleet will grow from 17 turboprop airplanes to 20 and flights will increase from an average of 110 per day to 120. The airline will also begin operations at its new $45 million terminal, where the first phase of construction should be completed by the spring.

Porter plans to expand domestic and transborder service early next year, Deluce said. He won’t say what Porter destinations are on the horizon, only that Washington and Philadelphia "continue to be of interest," as well as "other places in eastern Canada within roughly an hour and a half of Toronto."

Because Porter is privately held, it does not report financial results. But Deluce said the airline turned a profit this year.

"By any account, (Porter had) at least 300-per-cent growth during a year that arguably was one of the worst aviation years on record," Deluce said.

Porter has also been good business for the Toronto Island airport, which has been humming with activity since the airline moved in.

On Christmas Eve, the Toronto Port Authority announced it received preliminary results from a new capacity assessment study, and now anticipates an increase of between 42 and 92 daily flights at the airport by the second half of next year. The TPA also said it will begin accepting proposals in early 2010 from other commercial carriers that hope to begin using the island airport.

Before Porter came along, the island airport – recently renamed the Billy Bishop Toronto City Airport – handled 25,000 passengers annually. By the end of 2009, that number was forecast to hit 750,000, and Deluce estimates that 2010 will see more than a million passengers passing through the airport.

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The U.S. Treasury Department said Thursday that it will remove the caps on assistance to Fannie Mae and Freddie Mac for the next three years to alleviate market concern about the effect of limited government assistance.

The two companies, the largest sources of mortgage financing in the U.S., are currently under government conservatorship and have caps of $200 billion each in backstop capital from the Treasury. Under the new deal, these caps can rise as needed to cover net losses over the next three years.

Fannie Mae and Freddie Mac now are using a combined $111 billion of the total $400 billion in available assistance. Treasury Department officials said they did not expect the companies to need assistance beyond what is available under the current caps, barring significant deterioration in the economic outlook.

Thursday’s announcement "should leave no uncertainty about the Treasury’s commitment to support these firms as they continue to play a vital role in the housing market during this current crisis," the Treasury said in a statement in Washington.

The Treasury also relaxed its timeline for Fannie Mae and Freddie Mac to shrink their portfolio of retained mortgages. Previously, the companies were instructed to shrink their portfolios at a rate of 10 percent a year. Now, they will be required to keep their portfolios below a maximum limit, currently $900 billion, that will fall by 10 percent a year.

This means they will not need to take immediate action to reduce their holdings and could allow them to rise payday loans for bad credit. Fannie Mae’s portfolio ended October at $771.5 billion and Freddie Mac’s holdings at the end of November were $761.8 billion, according to the latest figures released by the companies.

The Treasury said Thursday that it is ending its mortgage- backed security purchase program as of Dec. 31, after $220 billion in purchases. The government also is eliminating a short-term credit facility for the two companies and the Federal Home Loan Banks that was never used.

EXECUTIVE PAY

The two chief executives of Fannie Mae and Freddie Mac could get paid as much as $6 million for 2009, despite the companies’ dismal performances this year, which cost taxpayers more than $100 billion.

Fannie’s CEO, Michael Williams, and Freddie CEO Charles "Ed" Haldeman Jr. each will receive $900,000 in salary, $3.1 million in deferred payments next year and another $2 million if they meet performance goals, according to filings with the SEC on Thursday.

The packages were approved by the Treasury and the Federal Housing Finance Agency, which regulates Fannie and Freddie.

The Associated Press contributed to this report.

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WASHINGTON – A U.S. federal appeals court has upheld a US$290-million judgement against Microsoft Corp. in a patent case launched by Toronto-based i4i Inc.

The ruling also includes an injunction, set to go into effect Jan. 11, that would prevent the sale of at least some versions of Microsoft's popular Word word processing software.

The Tuesday decision was on an appeal Microsoft launched against a verdict returned by a Texas jury in favour of i4i . The jury found recent versions of Microsoft Word infringed on a software patent.

I4i sued Microsoft (NASDAQ:MSFT) over the way Word 2003 and Word 2007 customize XML, or extensible markup language, used in encoding and displaying information.

The injunction prevents Microsoft from selling Word products that have the capability of opening an XML file containing custom XML.

Kevin Kutz, Microsoft's director of public affairs, said the world's biggest software company is "moving quickly to comply with the injunction."

Kutz said the injunction "applies only to copies of Microsoft Word 2007 and Microsoft Office 2007 sold in the U.S. on or after the injunction date of Jan. 11, 2010."

"Copies of these products sold before this date are not affected," he added.

"With respect to Microsoft Word 2007 and Microsoft Office 2007, we have been preparing for this possibility since the District Court issued its injunction in August 2009 and have put the wheels in motion to remove this little-used feature from these products," he said.

"Therefore, we expect to have copies of Microsoft Word 2007 and Office 2007, with this feature removed, available for U.S. sale and distribution by the injunction date.

"In addition, the beta versions of Microsoft Word 2010 and Microsoft Office 2010, which are available now for downloading, do not contain the technology covered by the injunction."

Kutz also said Microsoft was considering it legal options, “which could include a request for a rehearing by the Federal Circuit Court of Appeals en banc or a request for a writ of certiorari from the U.S. Supreme Court."

– With files from The Canadian Press

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Stocks closed sharply lower Thursday after Greece received another credit downgrade and the dollar rose on the U.S. central bank’s cautious comments.

The Dow Jones industrial average (INDU) fell 133 points, or 1.3%. Declines were broad based, with 28 of the 30 Dow components ending lower.

The S&P 500 index (SPX) lost 13 points, or 1.2%. The Nasdaq composite (COMP) slipped 27 points, or 1.2%.

The stock slump came as the dollar rebounded 1.3% against the euro, to its highest levels since September. The greenback was also up sharply on the pound and slightly higher against the yen.

The dollar jumped Thursday for two reasons, according to Craig Peckham, strategist at Jefferies & Co. First, he said, were the "continuing jitters" after the Federal Reserve on Wednesday left interest rates unchanged near 0%, saying weakness would remain for some time. Adding to those fears were reports that Greece has been downgraded by Standard and Poor’s.

S&P’s move came after health care companies complained that the country was behind on payments related to its public health system, and it follows Fitch Rating’s downgrade of Greece on Dec. 8.

Marc Chandler, chief foreign exchange strategist for Brown Brothers Harriman, said those downgrades and persistent worries about the economy are driving up the dollar — and these concerns could carry extra weight amid "very thin" volume ahead of the holidays.

"Santa Claus is giving a little present to people like me, who are dollar bulls," Chandler said.

Despite posting gains early in the session, stocks ended mixed Wednesday after the Fed’s interest rate announcement.

Financials take a hit: The slump slammed several bank shares, with Citigroup (C, Fortune 500) closing down 7.5%, American Express (AXP, Fortune 500) off 2% and JPMorgan Chase (JPM, Fortune 500) down 2.6%.

According to reports, the Treasury canceled plans to start selling off part of its 34% stake in Citi after its offering of 5.4 billion shares of common stock drew weak demand.

The offering was part of a plan Citi announced late Wednesday, in which the New York-based lender said it intends to raise $20.5 billion in the stock market in a plan to pay back its bailout funds.

"The market is struggling to absorb these staggering amounts of new issue," said Jefferies’ Peckham. "Marry that with the overriding theme of caution, and investors will be nervous."

Bank of America (BAC, Fortune 500) said late Wednesday it appointed senior executive Brian Moynihan as its new chief executive officer. Moynihan is currently the president of consumer and small business banking high risk personal loans. Exiting CEO Ken Lewis surprised the board of directors when he announced plans to retire in September. Shares were down 1.1%.

Economy: The Labor Department reported jobless claims rose unexpectedly last week, jumping by 7,000 to 480,000. Analysts predicted a decline to 465,000 new claims.

The November index of leading economic indicators, from the Conference Board, rose 0.9% — beating expectations of a 0.7% jump.

The Philadelphia Fed index, a regional read on manufacturing, far surpassed expectations. The reading jumped to 20.4 in December, the highest since April 2005, from 16.7 in November. Analysts expected a decline to 16.0.

In Washington, a Senate Banking committee voted 16-to-7 to confirm Ben Bernanke for another four-year term running the Federal Reserve.

Companies: Before the start of trading Thursday, package-delivery firm FedEx (FDX, Fortune 500) reported earnings of $1.10 per diluted share, down from $1.58 one year ago.

FedEx issued cautious guidance for the third quarter of 50 to 70 cents per diluted share. That fell short of forecasts of 84 cents per share, and the stock price lost 6.1%.

After the market close Thursday, Oracle (ORCL, Fortune 500) reported a profit of 39 cents a share versus 34 cents a year ago. The software company’s results beat analyst expectations of 36 cents per share.

Also after the bell, Nike (NKE, Fortune 500) reported a second-quarter profit of 76 cents a share, down from 80 cents a share. Analysts were looking for 71 cents a share.

Smartphone maker Palm (PALM) reported a wider-than-expected loss of 37 cents per share in its second fiscal quarter.

Palm’s rival, Blackberry maker Research in Motion (RIMM), earned $1.10 per share, up from 69 cents a year ago. RIM shares were up about 11% in after-hours trading.

World markets and commodities: Stocks in Asia ended mixed, with Tokyo’s Nikkei index falling 0.13% and Hong Kong’s Hang Seng index off 1.22%. European indexes settled lower.

Crude oil for January delivery fell 1 cent to settle at $72.65 a barrel, while gold for February delivery plunged $28.80 to end at $1,107.40 an ounce.

Bonds were higher, with the benchmark 10-year yield slipping to 3.49% from 3.59% late Wednesday.

Market breadth was negative. On the New York Stock Exchange, losers beat winners almost three to one on volume of 1.7 billion shares. On the Nasdaq, decliners topped advancers almost three to one on volume of 1.9 billion shares. 

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Australia’s economy probably expanded in the three months through September for a third straight quarter, boosted by government spending on roads, ports and schools.

Gross domestic product gained 0.4 percent from the second quarter, when it rose 0.6 percent, according to the median estimate in a Bloomberg News survey of 17 economists. The economy probably grew 0.7 percent from a year earlier, the survey showed. The Bureau of Statistics will release the GDP report tomorrow at 11:30 a.m. in Sydney.

Australia’s economy, one of the few to skirt the global recession, grew in the third quarter and will accelerate in 2010 as consumer confidence gains and demand rises for exports such as iron ore, the central bank said today. Faster growth adds to pressure on Governor Glenn Stevens to raise borrowing costs in February after this month becoming the only policy maker in the world to increase interest rates three times this year.

“The economy is gaining good momentum into the end of the year and we continue to expect a further Reserve Bank rate adjustment in February,” said Paul Brennan, an economist at Citigroup Inc. in Sydney.

Prime Minister Kevin Rudd’s government is spending A$22 billion ($20 billion) on ports, roads, hospitals and schools, adding 0.8 percentage point to GDP in the third quarter, Citigroup estimates.

Global Rebound

Tomorrow’s report may add to global evidence of an economic rebound. Europe’s economy emerged from its worst slump in more than six decades in the third quarter, expanding 0.4 percent from the previous three months, a report showed on Dec. 3. The U.S. economy grew at a 2.8 percent annual pace.

Australia’s economy is expanding faster and generating more jobs than the government and central bank forecast at the start of the year as China’s demand for raw materials including iron ore, coal and gas prompts mining and energy companies such as BHP Billiton Ltd., Woodside Petroleum Ltd. and Santos Ltd. to increase investment and hire workers.

Treasurer Wayne Swan last month forecast GDP will rise 1.5 percent in the 12 months through June 30, 2010, compared with a May prediction of a 0.5 percent contraction. The central bank says the economy will grow 2.25 percent this fiscal year and 3.25 percent in 2010-11.

Employers added 99,500 workers between the start of September and Nov No teletrak payday loan. 30, the biggest three-month hiring surge in three years, a report showed last week. The jobless rate fell to 5.7 percent from 5.8 percent.

Gas Deal

Chevron Corp. said this month it has signed a deal with Japan’s Tokyo Electric Power Co. to supply liquefied natural gas from its Wheatstone venture in Western Australia. The project, estimated to be worth $82 billion, is forecast to generate 6,500 jobs during construction.

It is in addition to the $39 billion Chevron-led Gorgon gas venture, also in Western Australia, which is forecast to create 10,000 jobs when construction starts early next year.

Stronger economic and jobs growth will increase Governor Stevens’s scope to increase borrowing costs next year. He raised the overnight cash rate target by a quarter percentage point on Dec. 1 to 3.75 percent, adding to similar moves in October and November.

The central bank said today its decision to raise borrowing costs two weeks ago gives it more flexibility in future.

“Members agreed that, if developments unfolded as currently expected, monetary policy would need to be adjusted further over time to lessen the degree of stimulus,” officials said in minutes released today of their Dec. 1 gathering.

‘Appropriate Stance’

“That adjustment would not be intended to slow demand compared with the current forecast path, but aimed simply at keeping the stance of policy appropriate for improving economic conditions.”

Figures available at the time of the central bank’s board meeting two weeks ago “suggested a rise in GDP for the quarter,” today’s minutes added.

Investors are betting there is a 62 percent chance of a quarter-point increase in the benchmark lending rate to 4 percent at the central bank’s next meeting on Feb. 2, according to Bloomberg calculations based on interbank futures on the Sydney Futures Exchange at 12:02 p.m.

The statistics bureau, which normally publishes third- quarter GDP figures in the first week of December, delayed publication of the report this year by two weeks as officials adopt new accounting standards.

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General Electric — the last of the giant diversified conglomerates — has adopted a strategy that was once unthinkable: narrowing its focus. It’s a risky move for a company that had counted on its diversity as a hedging tool. But it’s also one that may pay off in spades.

By selling off media and entertainment division NBC Universal to Comcast (CMCSA, Fortune 500), GE is left with its core infrastructure business, which includes energy, transportation and health care units, as well as finance arm GE Capital and some consumer and industrial businesses. GE Chief Executive Jeffrey Immelt said on Thursday that the Comcast deal will allow GE to "play offense" by reinvesting in infrastructure, which performed very well during the recession.

That would mark a nice shift from GE’s defensive play, which was led by its flagging media division. NBC Universal’s profit has plunged 27% so far in 2009, compared to a 14% rise in earnings from its energy infrastructure businesses. Unlike NBC (and GE Capital for that matter), GE’s infrastructure unit helped the company weather the economic storm.

GE (GE, Fortune 500) bought NBC in 1985 for $6.3 billion to act as a hedge against its industrial businesses. With businesses in seemingly every sector, GE had counted on that part of its company to always do well no matter what the economic climate.

But analysts say holding onto NBC became too risky for GE, as the changing media landscape made it difficult to know how to invest. Internet media has soared, but it remains unclear how it will be monetized. Cash flow margins at NBC’s cable networks have been solid, but its broadcast channels have just a slim 5% margin.

"They’re getting out of a market at a good price where it is unclear whether they’re going to succeed," said Ed Zabitsky, analyst with ACI Research. "When you’re uncertain about a unit and you can sell it for a tremendous amount, you can take out a tremendous amount of risk."

Dialing back risk, dialing up growth. Many say GE has taken on enough risk by holding onto its finance unit, GE Capital. Once a driver of 40% of GE’s operating profit, GE Capital has gotten slammed by the subprime mortgage crisis and now contributes just more than 14% of GE’s earnings.

Analysts say that the main reason GE isn’t shopping GE Capital around is that GE won’t be able to get top dollar for the unit because of the lingering effects of the credit crisis.

Also, unlike NBC, GE Capital actually has some synergies with its core business. In addition to its mortgage and lending business, GE Capital finances the parent company’s infrastructure purchases, and it offers financing to GE’s vendors as well no fax payday loans.

Even in its heyday in the 1990s, when NBC was making upwards of $400 million a year for GE, the media company had no other synergies with GE’s other businesses. Now that NBC is slumping, GE decided it was the right time to unload it.

"As management reshapes GE, there’s clearly going to be a focus on the classic infrastructure businesses that have been its cash cows, namely energy, transportation, health care," said Nick Heymann, analyst at Sterne Agee & Leach. "Everything else that’s left will be a facilitator for one of those core businesses."

Heymann said the businesses that GE will decide to hold onto will all be focused on growth. GE believes that its infrastructure and related businesses have the best chance to succeed because of those units’ strong positions in the fast-growing emerging markets.

"This deal gives us tremendous flexibility at exactly the right moment and time," said Immelt on a conference call with investors. "There are lots of global opportunities in infrastructure as we think about the company going forward."

The death of the conglomerate. Experts say GE’s decision to unload risk and focus on what it does best puts a nail in the coffin of the conglomerate idea.

"The whole idea of conglomerate is really lousy," said Peter Cohan, a venture capitalist, management consultant and GE shareholder. "You can’t hedge cash flows of one business from another, because they can’t predict how they’ll interact."

Cohan said that over time, companies found the notion that they could offset risk from one industry by owning a business in another was overly simplistic, as there is no way to ensure that one business will succeed when another fails.

Instead, according to Zabitsky, GE and other companies are now opting to increase their capital reserves to offset risk instead of making non-core acquisitions.

But not everyone agrees that GE’s strategy is the best.

"GE had enough balance in its business that if something got disrupted, there would be something else there to save the day," said Rick Munarriz, senior analyst at The Motley Fool. "I don’t necessarily agree with its decision to trim down and focus on its core. This isn’t the time to shrink, this is the time to take advantage of everyone else shrinking." 

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The International Monetary Fund said it will have access to a credit line of up to $600 billion to make loans during financial crises after contributing countries agreed to fold commitments into one pool.

The agreement, yet to be approved by the IMF board, adds as many as 13 members from the current 26 to the so-called New Arrangements to Borrow, including emerging nations China, Russia, Brazil and India, the IMF said in an e-mailed statement.

The decision “marks an important moment for multilateralism and the fund, which will help the IMF’s effectiveness in its response to crises,” Managing Director Dominique Strauss-Kahn said in yesterday’s statement.

The deal goes beyond a pledge by leaders of the Group of 20 nations to contribute up to $500 billion to a credit arrangement that’s currently worth $54 billion, the IMF said. The worst financial crisis since the Great Depression prompted more nations to seek aid from the fund, created after World War II to help ensure the stability of the global monetary system.

The agreement, which merges existing commitments into one facility, makes it easier for the IMF to tap into its supplemental resources. The credit line will be “an effective tool of crisis management as a backstop for the international monetary system,” the IMF statement said cash advance loans.

While a general agreement on the NAB was reached at the G- 20 meeting in Pittsburgh in September, talks on the specifics stalled over divisions between some emerging and developed nations over voting rights relating to the credit facility.

Borrowed From Members

The IMF has estimated that its current credit line was insufficient when the financial crisis boosted demand for loans. It then started to borrow from individual members, such as Japan, to continue lending to countries in difficulty.

To ensure the institution would continue shoring up economies around the world, G-20 leaders in April pledged to add $500 billion to the IMF’s resources.

Some of these contributions were bilateral loans, while China agreed to participate by buying the first IMF notes. Some countries, like the U.S., made theirs directly to the NAB.

When the new credit-line agreement is activated, all the bilateral loans will fall into it, Andrew Tweedie, who heads the IMF Finance Department, said in a Nov. 20 interview. It won’t come into effect before next year, he said.

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