There was dirt shoveling but no mud slinging at a groundbreaking ceremony Tuesday for billionaire Bruton Smith’s $60 million drag strip across from Lowe’s Motor Speedway.In October, Smithwas at odds with the city of Concord, which initially thwarted his drag strip plans, citing neighbors concern over noise and lack of information from Smith. But on Tuesday, Concord Mayor Scott Padgett and other local officials were on hand and smiling.”Today we are truly beginning a new era in motorsports in Concord,” said Padgett, who even displayed his drag strip alarm clock, which he said wakes him with revving noises.The drag strip will help mitigate sound through its design, including walls and a grandstand that help block and absorb noise. Padgett said residents he has talked with are grateful that the city helped make sure noise abatement was part of the drag strip plans.After the city initially rejected his plans, Smith threatened to move the whole speedway. Eventually, after being promised $80 million in government incentives, mostly in road improvements, he agreed to build the drag strip and proceed with $200 million in speedway renovations.”We had a little bit of a tussle,” Smith said. “Now just watch how fast it goes along.”Smith expects the drag strip to be finished in time for a National Hot Rod Association event Sept.11-14. Local tourism officials estimate that event will bring $9.8 million into the area’s economy.Beside The Dirt Track @ Lowe’s Motor Speedway, the drag strip’s track, pit areas and midways will cover 46.5 acres, part of a 125-acre site. For now, it’s called The Dragway @ Lowe’s Motor Speedway, although Smith is running a contest to rename it.Grading continues at the drag strip site.The first phase of speedway renovations is scheduled to start Thursday: the upgrading of 22,850 seats along the front stretch. Bleacher or concrete seats will be replaced with individual seats with backs.

THE NEXTBIG THINGNorthwest frontier is feeling its spursWith vacant land disappearing, developers are now looking to what some call Mecklenburg’s final frontier — the northwest.Columnist Doug Smith shows you how a key interchange in the area is changing as a former golf course is transformed into a residential development.It adjoins a mixed-use project that will include stores, single-family houses, apartments and townhomes.Real estate experts believe improved road access, available land and the U.S. National Whitewater Center will focus even more attention on the area.INSIDE 4-5D

Lingering hopes that the U.S. economy might avert a recession withered Tuesday after the nation’s service sector — its banks, travel companies, contractors and stores, among others — shrank for the first time in five years.It was unwelcome news for many investors, who were beginning to believe that the Federal Reserve might engineer a way out of the worst economic slowdown since 1991. Stocks slumped and bonds rose as investors fled to the safety of government-backed securities.Much of the talk was not about whether there would be a recession, but about how bad it might be.”The number’s so terrible it’s almost beyond belief, especially among the optimists,” said Scott Anderson, senior economist at Wells Fargo & Co. “I think the writing’s on the wall. More and more economists are talking about recession, and whether it’ll be a severe or mild one.”The January reading from the Institute of Supply Management “was about as big a shock as you can probably get,” said Joel Naroff, chief economist at Commerce Bancorp.The Dow Jones industrial average fell 370 points, its biggest point drop since August.Anderson said he believes January may end up being the official start of a recession. Many businesses already suspect as much.Moving company Allied Van Lines filed for bankruptcy Tuesday, saying it had fallen victim to the downturn in the housing market and its own heavy debt load. Charming Shoppes Inc. — which runs the Petite Sophisticate and Lane Bryant clothing stores — said it would cut 200 jobs and close 150 stores.Stocks of rental car companies plunged Monday after Dollar Thrifty Automotive Group Inc. slashed its earnings guidance. The company said it sees weak demand in the travel market and soft used-car sales.In the tourism sector, water park operator Great Wolf Resorts Inc. is seeing a drop in business at its resorts in Traverse City, Mich., and Sandusky, Ohio — two areas where jobs are dependent on the sagging auto industry, said the company’s chief executive, John Emery.Business is up slightly overall for the Madison, Wis.-based operator of 10 resorts. But at the Rust Belt parks, families are cutting their spending by 2 percent to 4 percent. “Those are tough markets for families for right now,” Emery said.Executives surveyed for the service sector report by the Institute for Supply Management fretted over the economy, high oil prices, the falling stock market, lower customer demand, stiffer competition and sluggish sales, said Anthony Nieves, chairman of the trade group’s non-manufacturing business survey committee.The ISM’s new composite index measuring the health of the service sector was 44.6 in January, below the level of 50 that indicates expansion. The group’s measure of non-manufacturing business activity fell to 41.9 in January from a revised reading of 54.4 in December — its largest drop ever. Economists surveyed by Thomson Financial/IFR had expected a slight slowdown but had still forecast growth, with a median estimate of 53.The last time the ISM reported that the service sector shrank — that is, registered less than 50 — was March 2003.”I think it will be tipping plenty of people over the edge” in convincing economists that the U.S. is in a recession, said Nigel Gault, chief U.S. economist at Global Insight.Gault said that in March 2001, the beginning of the last recession, the index had a break-even reading of 50. And during that recession, the index hung around 48 or 49 — several points higher than January’s reading.”This is an absolute collapse of this index,” he said.Two measures that fell were those for new orders and employment, and that could signal more trouble ahead. New orders fell to 43.5 while employment fell to 43.9. The drop in employment is especially troubling, because the service sector has been the overall economy’s engine of job growth for months.Factories eliminated 28,000 jobs in January and have cut 269,000 jobs over the past 12 months, the government reported last week. The economy as a whole lost 17,000 jobs last month, which was the first nationwide loss of jobs since August 2003.The financial services industry, part of the wider service economy, has been especially hard hit by falling home prices, mortgage defaults and the devaluation of mortgage-backed investments.After writing down their portfolios and putting money in reserve to prepare for further losses, banks, mortgage lenders and brokerages are now strapped for cash and have pared their payrolls to cut costs.Challenger, Gray & Christmas Inc., a placement consulting firm, said companies announced 69 percent more job cuts in January than in December, and about 21 percent of those were in the financial sector. According to the firm, the financial sector eliminated more than 153,000 jobs in 2007, a record amount. — AP Business Writers Dave Carpenter in Chicago, Emily Fredrix in Milwaukee and Madlen Read in New York contributed to this report.Charlotte regionIn the six-county Charlotte region, the number of employees working in public and private service jobs rose 3 percent in 2007, according to the U.S. Bureau of Labor Statistics. Last year, there were 700,400 public sector service workers and 595,408 service workers in the private sector. Together, they reflect about 80 percent of all Charlotte region workers. — Nichole Monroe Bell

Last spring, Wachovia bank was accused in a lawsuit of allowing fraudulent telemarketers to use the bank’s accounts to steal millions of dollars from unsuspecting victims. When asked about the suit, bank executives said they had been unaware of the thefts.But newly released documents from that lawsuit now show that Wachovia had long known about allegations of fraud and that the bank, in fact, solicited business from companies it knew had been accused of telemarketing crimes.Internal Wachovia e-mail, for example, shows that high-ranking employees at the nation’s fourth-largest bank frequently warned colleagues about telemarketing frauds routed through its accounts.Documents also show that Wachovia was alerted by other banks and federal agencies about ongoing deceptions, but that it continued to provide banking services to multiple companies that helped steal as much as $400 million from unsuspecting victims.”YIKES!!!!” wrote one Wachovia executive in 2005, warning colleagues that an account used by telemarketers had drawn 4,500 complaints in just two months. “DOUBLE YIKES!!!!” she added. “There is more, but nothing more that I want to put into a note.”However, Wachovia continued processing fraudulent transactions for that account and others, partly because the bank charged fraud artists a large fee every time a victim spotted a bogus transaction and demanded their money back. One company alone paid Wachovia about $1.5 million over 11 months, according to investigators.”We are making a ton of money from them,” wrote Linda Pera, a Wachovia executive, in 2005 about a company that was later accused by federal prosecutors of helping steal up to $142 million.Pera left Wachovia in 2006, and could not be located.Lawyers pursuing the lawsuit against Wachovia, which was filed in a Pennsylvania federal court on behalf of a woman named Mary Faloney and other apparent victims, have asked a judge to declare the case a class action, which could expand it to as many as 500,000 plaintiffs.The lawsuit alleges that Wachovia accepted fraudulent, unsigned checks that withdrew funds from the accounts of victims, often elderly. Wachovia forwarded those checks to other banks that were unaware of the frauds, which in turn sent money to the swindlers.A judge is expected to rule on the class action request by this summer. Wachovia, in court filings, has denied the suit’s allegations. The company declined to comment on the pending litigation.However, Wachovia’s senior vice president for risk management, Alan Chudoba, said that the bank introduced reforms aimed at telemarketing frauds last summer. Those changes, which came about after an article in The New York Times last May reported that thieves had used Wachovia accounts, include greater scrutiny of accounts used by telemarketers and stronger fraud protections.In a statement, Wachovia said: “Earning the trust of our customers is at the heart of what we do every day, and we regret this situation occurred. We took this issue very seriously, and senior management, led by CEO Ken Thompson, was actively involved in directing aggressive steps to correct the processes related to this situation. We are confident that the changes we’ve implemented will help protect our customers.”Some advocates cautiously applaud the bank’s efforts.”This could be very good news for millions of consumers,” said Kathleen Keest with the Center for Responsible Lending, an advocacy group working to eliminate abusive financial practices.”But reforms tend to happen quickly in the light of publicity, followed by backsliding when the spotlight fades,” Keest added.One of the lawyers handing the Pennsylvania suit said Wachovia should do more.”I don’t understand why, like other banks, Wachovia simply doesn’t have a policy to avoid any business related to telemarketers,” said Howard Langer, of the firm Langer, Grogan and Diver.A Wachovia spokeswoman said the bank was not currently working with any telemarketers, would review any future clients who do work with telemarketers and would reject any client solely focused on telemarketing.In the past three years, government agencies have sued several companies accused of routing telemarketing thefts through at least nine banks, including Wachovia, the largest company named in those lawsuits.However, Wachovia and most other banks accused of involvement in similar frauds have never been publicly fined or prosecuted by federal regulators for aiding telemarketing criminals.So some victims have turned to private lawsuits.The Pennsylvania suit against Wachovia alleges that the bank’s involvement with telemarketing thefts dates to October 2003, when Wachovia was warned by another bank that a Wachovia client named AmeriNet had tried to process more than $100,000 in improper withdrawals.AmeriNet was a “payment processor,” a company that creates unsigned checks on behalf of telemarketers to withdraw funds automatically from customer accounts. Such checks, once widely used by businesses collecting monthly fees, are legal if customers approve the transactions.However, a Wachovia executive wrote to colleagues, evidence suggested AmeriNet was creating unapproved checks.”Keep in mind historically, telemarketing is an easy way to money launder and commit fraud. To knowingly bank a customer who is perpetrating fraud places the bank at great exposure,” wrote that executive, Tim Brady, according to documents that are part of the lawsuit.

Girded by Duke Energy’s strong annual earnings, chief executive Jim Rogers said Tuesday the utility might search for a new deal to expand its reach and take advantage of the fragmented utility industry.With the experience of a recent merger and the completion of several major projects last year, the company is well positioned to jump on a good opportunity, he said.”But you have to be lucky enough to find the right partner who matches up,” he told the Observer in a Tuesday interview.Rogers said the country doesn’t have any national leaders in the utility industry and that several recent high-dollar mergers have failed.In other countries, utilities are larger and often in the top 10, he said. Here, utilities are more regional and aren’t able to take advantage of economies of scale in purchasing and other benefits of being larger.Rogers predicted more mergers in the industry in the near future.He said Duke might look to renewable energy or a traditional power company as potential partners.There are no immediate plans, he said.Peter Maloney, chief editor of the Global Power Report, agreed with Rogers that in other countries, such as Germany, a few major utilities tend to dominate.But he said predictions that the U.S. industry would consolidate again have been around for a few years and that some aspects of mergers have actually gotten more difficult.Relaxed federal oversight has, in effect, given state regulators more power.And they have blocked several high-profile attempts in recent years, he said.Before Rogers made his prediction, Duke reported lagging fourth quarter profits, but mainly due to the one-time effects of major changes at the company.The company reported fourth quarter net profits of $271 million, or 21 cents per share, down from $387 million, or 31 cents per share, for the same period in 2006. That was before Duke spun off its natural gas pipeline operations in January 2007, into stand-alone Spectra Energy Corp.Accounting for Spectra’s influence and other one-time items, Duke reported 27 cents per share for the quarter compared with 23 cents for the same period the year before.Analysts polled by Thomson Financial predicted 24 cents for the quarter, excluding special items and discontinued items.Revenue increased to $3.03 billion from $2.8 billion during the same quarter a year earlier.Full-year earnings were positive, boosted by sales during the summer heat wave that pumped up power demand enough for a cool $100 million in extra third quarter profits.For the year, Duke reported net income of $1.53 billion, or $1.21 cents per share, compared with $1.86 billion, or $1.57 cents per share, in 2006. That beat the company’s self-imposed target of $1.15 a share that triggers employee bonuses.Accurately comparing the full year’s performance with 2006 is complex because Duke did not complete the Cinergy merger until the second quarter of 2006 and the natural gas pipeline operations were part of Duke for that entire year.Key profit-making businessesDespite lagging fourth-quarter earnings, Duke had strong profits in its core business of selling electricity. • Duke’s U.S. franchised electric and gas, its main business, increased earnings to $519 million from $423 million in the same period the year before due to higher demand, rate increases in the Midwest and more long-term contracts to sell wholesale power.• Duke’s commercial power division increased earnings in the quarter to $38 million from a $19 million loss the same period the year before. The utility made money from successful hedges on the rising price of coal. And natural gas operations made more money in the Midwest.• Duke Energy International reported $105 million in earnings for the quarter compared with a $15 million loss the same quarter the year before. Duke was able to free up $100 million from a fund it had in a reserve because of litigation.• Crescent Resources, the land development company of which Duke is part owner, was bit by the real estate slowdown this year. But Duke reported a fourth-quarter profit from its 49 percent stake of $32 million compared with $17 million during the same period the year before. The increase was partly due to profits from the sale of Piedmont Town Center in Charlotte.

The numbers confirm what many weary travelers already knew: 2007 was one of the worst years ever for the Charlotte airport and US Airways when it came to late flights.Other statistics released Tuesday, however, show that the airport and its dominant carrier improved at the end of the year — so much that US Airways workers will even get a little cash for the carrier’s strong finish.The airport and the airline both were among the nation’s best for on-time arrivals in December, which nationally was one of the worst months for flight delays since the U.S. Department of Transportation began tracking data in 1995.Nearly 72 percent of Charlotte-bound flights in December landed on time, placing the airport third among 32 major U.S. airports.The airport’s on-time arrival rate a year earlier was about the same, but its ranking jumped from 19th because several other airports posted worse arrival rates last December.For all of 2007, Charlotte’s on-time arrival rate was slightly better than 71 percent, or 24th among airports.That’s up from last spring but down significantly from earlier this decade, when the airport regularly saw more than 80 percent of flights land on time and ranked as high as No. 2 in the country.Winter storms caused some delays last February and March, and congested skies in the Northeast and backups at other airports often had a domino effect in Charlotte last year.But stumbles at US Airways — which operates more than 80 percent of flights at Charlotte/Douglas — are a big reason why almost three out of every 10 planes landed late in Charlotte. Computer glitches during the merger of two reservation systems in March caused long lines and dozens of delays, leading US Airways to hire more ticket and gate agents, as well as a new chief operating officer, last year.In December, three out of every four US Airways flights nationwide landed on time — good enough to make the airline No. 1 among major carriers. For the year, less than 69 percent of US Airways flights arrived as scheduled, placing the carrier 18th among 20 airlines that report data to federal officials.By ranking in the top three of major carriers in December, US Airways will give each of its roughly 36,000 employees a $50 bonus, for a total payout of about $1.8 million, airline officials said.It was the carrier’s first top three on-time performance since March 2006, and it came in a month when travel was heavy and winter weather could have disrupted flights, said US Airways President Scott Kirby.”In spite of those challenges, our employees worked together and ran a great airline,” Kirby said in a statement. “We couldn’t be happier to make these (bonus) payments.”US Airways complaintsBesides flight delays, US Airways struggled in 2007 with other aspects of its operation.The airline had 8.47 mishandled baggage reports per 1,000 passengers — worse than the industry average of 7.03 and worst among major carriers. It also was worse than the airline’s 7.88 reports per 1,000 passengers in 2006.As for consumer complaints, US Airways had not only the highest rate of passenger gripes but also the most complaints total, despite being the nation’s fifth-largest domestic carrier.US Airways’ 1,828 complaints translated to 3.16 complaints per 100,000 passengers — far higher than the 1.37 per 100,000 average for the industry. Foremost among criticisms were flight problems, baggage handling and customer service.

Investors’ raging demand for safe assets over the past six months may have created a bubble in the Treasury market — and some onlookers expect to hear a bursting sound any minute now.A market bubble exists when asset prices are driven well above their intrinsic value, as occurred with stocks in 1999 and housing prices in many parts of the country in 2006. Often the end of a bubble is marked by disruptively sharp price declines as investors abruptly conclude assets are overvalued.There are mixed views about whether the recent buying spree in the Treasury market has driven prices up to unjustified bubble levels. The rally, which has also sent bond yields plunging to multiyear lows, was fed first by fallout from the subprime mortgage crisis and then by growing worries about a recession.”I’m one who believes there is a bubble. Everyone has been focused on Treasurys because they are afraid of the alternatives,” said Michael Metz, chief investment officer at Oppenheimer & Co. “It has nothing to do with the value of Treasurys, which are overvalued. The stampede has been because of fear.”Metz believes the bubble is likely to give way to selling soon, particularly for the longer-term 10-year note and the 30-year bond. Furious buying in January sent the 30-year bond’s yield below its 1977 debut level of 4.15 percent to a historic low of 4.13 percent. The 10-year yield, meanwhile, touched a four-year low of 3.29 percent.In Metz’ view, foreign demand for long-term Treasurys already is waning. He expects that trend to accelerate, driving long-term rates well above their current paltry levels.There are many who think the “fear trade” may not be going away any time soon. Lyle Gramley, a former Fed governor and senior analyst with the Stanford Financial Group, thinks buyers of Treasurys will continue to appear, no matter how elevated the prices and how weak the yield. People will continue to demand the safest assets they can find as long as worries persist about a possible recession and the subprime mortgage and bond insurance crises, he thinks.Whether an observer believes there is a bubble hinges partly on whether he or she thinks Treasurys are overpriced — although the fact prices are very high does not necessary mean the prices aren’t justified.”I wouldn’t call it a bubble, because the motivation for buying them is different than with the housing bubble,” said Steve Rodosky, head of Treasurys trading at PIMCO, the world’s largest bond fund. “This is more of a flight to quality.”This means that, if other assets are as weak as perceived, Treasurys actually could be worth the heady prices investors have been willing to pay.

RETAILWal-Mart said it will appeal a court decision that denied the retailer a $30 million tax refund from the state.Last month, a Wake County judge rejected the retailer’s argument that the state improperly assessed its corporate income tax for a four-year period.The state Department of Revenue contended that Wal-Mart tried to use tax shelters to obfuscate its earnings in North Carolina.

Moving company Allied Van Lines Inc., along with its corporate parent Sirva Inc., filed for bankruptcy protection Tuesday, the latest victim of a heavy debt load and the downturn in the U.S. housing industry.The company, which is based in Westmont, Ill., listed assets of $924 million and debts of $1.2 billion. Sirva filed a prepackaged Chapter 11 petition in U.S. Bankruptcy Court in Manhattan after reaching a deal with its lenders to cut its debt by some $200 million.In addition to its heavy debt load, the company’s relocation services business has been slammed by the downturn in the U.S. housing market.The company said it intends to stay in business during its bankruptcy case and expects to exit Chapter 11 in two to three months.

Ford Motor Co. will soon offer an in-dash computer with high-speed Internet access and a battery-powered inkjet printer on its F-150 pickups and commercial vans.Ford’s Work Solutions package also includes a radio-controlled tool tracking device, a computerized management system to help workers keep track of their vehicle fleets and a lockable storage system for pickup beds. The automaker is unveiling the package this week at the Chicago Auto Show.The features will be available together or separately, Ford spokesman Alan Hall said. Pricing hasn’t been released.Ford, which commands 40 percent of the U.S. commercial vehicle market, says 35 percent of its F-150s are sold to commercial customers. It’s aiming to maintain that lead with the new suite of gadgets that will be available on the 2009 F-150, which hits the market this summer. The package will also be available on E-series vans and on the Transit Connect commercial van, which also will be introduced in Chicago and will come to North America in 2009.The factory-installed Work Solutions package includes an in-dash computer with a 6.5-inch touch screen powered by Microsoft Windows CE and Windows Autos. It connects to the Internet via Sprint cellular broadband and is compatible with Bluetooth-enabled phones for hands-free calling.The Tool Link system lets owners mark and scan their tools using a radio tag. When the vehicle starts, antennas mounted inside the truck will scan the vehicle for the items on a preprogrammed inventory list and display the contents on the in-dash computer.”Think of Tool Link as no tool left behind,” said Mark Fields, Ford’s president of the Americas.The vehicle management system pinpoints the location of vehicles and keeps track of maintenance. It also can check tire pressures and diagnose problems if the check-engine light flashes.Workers can lock valuables in the pickup bed using a retractable steel cable that can be wrapped around tools and tool boxes. It’s Ford’s answer to the 2009 Dodge Ram, which will have a lockable storage container mounted into the sides of the pickup when it comes out later this year.The Work Solutions package came from Ford watching customers at job sites and looking to find solutions to unmet needs, said Derrick Kuzak, head of global product development.