Z.-Y. Li (University of Virginia, Astronomy, Charlottesville, United States),
R. Banerjee (Hamburger Sternwarte, Germany),
R. Pudritz (McMaster University, Department of Physics and Astronomy, Canada),
J. Joergensen (University of Copenhagen, Center for Star and Planet Formation, Denmark),
H. Shang (Institute of Astronomy and Astrophysics, Taiwan),
R. Krasnopolsky (Institute of Astronomy and Astrophysics, Taiwan),
A. Maury (ESO, Garching bei Muenchen, Germany)

The formation of stars and planets are connected through disks. Our theoretical understanding of disk formation has undergone drastic changes since PPV, and we are on the brink of an ALMA-enabled revolution in disk observation. Disk formation - once thought to be a trivial consequence of the conservation of angular momentum - is far more subtle in magnetized gas. In this case, the rotation can be strongly magnetically braked. Indeed, both analytic arguments and numerical simulations have shown that disk formation is suppressed in the strict ideal MHD limit for the observed level of core magnetization, at least for idealized, laminar, axisymmetric cores with ordered magnetic fields. In the theoretical literature, this "catastrophic" magnetic braking characterizes the situation wherein the angular momentum of an idealized collapsing core is nearly completely removed by magnetic braking close to the central object. We will review what is known about this "magnetic braking catastrophe", possible ways to resolve it, and the current status of early disk observations. Possible resolutions include non-ideal MHD effects (ambipolar diffusion, Ohmic dissipation and Hall effect), magnetic interchange instability in the inner part of protostellar accretion flow, turbulence, misalignment between the magnetic field and rotation axis, and depletion of the slowly rotating envelope by outflow stripping or accretion. We will assess the pros and cons of each of these proposed resolutions and put them into an over-arching physical context. Outflows are also intimately linked to disk formation; they are a natural product of magnetic fields and rotation and are important signposts of star formation. We review new developments on early outflow generation since PPV. The properties of early disks and outflows are a key component of planet formation in its early stages and we will review these major connections.

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