Fed chairman: Make tax cuts permanent

WASHINGTON - Federal Reserve Chairman Alan Greenspan said Thursday that Congress should make President Bush's tax cuts permanent and cover the $1 trillion price by trimming future benefits in Social Security and other entitlement programs.

Greenspan told the Senate Budget Committee that Congress, "as a first order of business," should restore budget rules that cap discretionary government spending and require increases in entitlement benefits or cuts in taxes to be offset by other program cuts or other tax increases.

Greenspan was asked how he would come up with the decade-long cost of $1 trillion to pay for extending the 2001 and 2003 individual tax cuts. "I would argue strenuously that it should be taken out on the expenditure side," he answered.

Car sales decline, but other retail up

A steep decline in car buying depressed sales at the nation's retailers by 0.3 percent last month, although consumers continued spending heartily in less expensive ways.

The overall decline - the first since September - was reported by the Commerce Department Thursday. It largely reflected a sharp drop in sales of automobiles. When auto sales - which tend to swing widely - are removed, sales at all other merchants rose by a strong 0.9 percent in January - the biggest gain in five months.

Kodak aims for top spot in digital cameras

ROCHESTER, N.Y. - Eastman Kodak Co., which sold more digital cameras in the United States during the end-of-year holiday season than any of its Japanese rivals, introduced six new camera models Thursday in hopes of surpassing top-ranked Sony Corp. this year.

Kodak is scrambling to make the transition from film to digital photography after getting blindsided by the swift rise in popularity of digital cameras.

SEC drops case against Kmart ex-executives

DETROIT - The Securities and Exchange Commission has dropped its accounting fraud case against two former Kmart executives, a lawyer for one of the men said Thursday.

The SEC had filed its civil action against Enio A. "Tony" Montini Jr. and Joseph Hofmeister in addition to criminal charges, which a judge dismissed in November after federal prosecutors in Detroit decided they did not have enough evidence.

The government claimed that Montini and Hofmeister conspired to inflate Kmart's earnings in the second quarter of 2001 by improperly recording a payment.

Mortgage rates ease after 2 weeks of rises

WASHINGTON - Mortgage rates - after rising for two consecutive weeks - dipped this week, offering a break for people wanting to buy a home.

The average rate on 30-year mortgages fell to 5.66 percent, down up from 5.72 percent last week, Freddie Mac, the mortgage giant said Thursday in its weekly nationwide survey.

Goodyear refinancing for $650M to pay debt

AKRON - Goodyear Tire & Rubber Co. on Thursday said it planned to refinance long-term debt to raise almost $650 million to pay off loans due next year.

The announcement came a day after the world's largest tire maker saw its stock plummet on news the federal Securities and Exchange Commission was investigating accounting problems and its corporate credit rating was lowered.

Goodyear said in a statement Thursday that it plans to use proceeds from the private sale of senior secured notes due in 2006 and beyond to prepay a $538 million loan due in 2005.

XM Satellite Radio sees big revenue jump

WASHINGTON - XM Satellite Radio Holdings Inc. on Thursday said fourth-quarter revenue more than tripled from a year ago, as it added more than a million subscribers.

The satellite broadcaster's net loss widened in the quarter to $162.9 million, from a net loss of $155.9 million in the same period a year earlier.

The loss per share narrowed to $1.12 from $1.76, because it had fewer shares outstanding in 2002. Fourth-quarter revenue rose to $33.5 million from $9 million. It ended the year with 1.36 million subscribers, up from 347,000 at the end of 2002.