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Updated: 11 min 28 sec ago

Tesla is disrupting more than just the car business

Sat, 2016-02-06 16:01

Tesla Motors is building the world's biggest battery factory just outside of Reno, Nevada. The company is calling it the “gigafactory,” and when it’s up and running in 2016 it’s expected to make Tesla’s electric cars much more affordable. 

“In a single factory we're doubling the worldwide capacity to manufacture lithium-ion batteries,” says J.B. Straubel, Tesla's chief technology officer. 

That's significant enough. But the company also plans to develop batteries for use with solar-power generation – giving Tesla a shot at challenging public utilities as an energy source, Straubel says.

“At the price points that we're expecting to achieve with the gigafactory ... we see a market that is well in excess of the production capability of the factory,” says Straubel.

The market for batteries is an offshoot of the booming business for solar panels, particularly in states such as California, where solar is becoming commonplace.

“We sign up approximately one new customer every minute of the workday," says Will Craven, director of public affairs at California-based SolarCity.

Much of the excess energy harnessed by solar panels is returned to the power grid, Cravens says. This means homeowners and businesses may earn a credit from their power companies, but have no say over when and how that energy is used.

The partnership with SolarCity will use rooftop solar panels fitted with Tesla’s battery packs to allow customers to keep that energy in-house. That means they can use it however, and whenever, they want. The concept puts Tesla in direct competition with utility companies.

“Stationary storage, or backup storage, is really being considered the ‘Holy Grail’ of renewable electricity generation,” says Ben Kallo, an analyst with the Robert W. Baird financial services firm.

Kallo points out that the intermittent nature of renewable energy sources makes them less reliable because the wind doesn’t always blow and the sun doesn’t always shine.  But with the ability to store that energy, renewable energy sources can compete head-to-head with utility companies for customers.

“There are still many utilities out there who kind of have their head stuck in the sand and just hope that this goes away. What we're seeing is really building momentum,” Kallo says.

Forward-minded utilities might look at Tesla’s business model as an opportunity, he says.  Energy-storage technology could be used to build capacity in their existing grids, and also build new infrastructure for battery-powered cars and homes.

 

Why the CPI doesn't figure in the Fed's calculations

7 hours 11 min ago

The Consumer Price Index rose by 0.1 percent last month, according to figures out Friday. You could think of it as one more piece of evidence in the "no inflation" pile.

The CPI is used for a variety of things, particularly in adjusting rent and wages, as well as "in private contracts to escalate values of money ... by the government ... to adjust social security, and so forth," says Steve Reed, an economist at the Labor Department's Bureau of Labor Statistics who works on the CPI.

But the CPI isn't what the Federal Reserve looks to when it tries to figure out whether the economy as a whole is experiencing inflation. The Fed prefers the Personal Consumption Expenditures index, or PCE.

Jeremy Siegel, a finance professor at the Wharton School at the University of Pennsylvania, says both of the measures' "headline" numbers are inaccurate, "and the reason for that is when the price of one good goes up, we substitute it with other goods." For instance, if beef gets expensive, you'll probably just buy some chicken, and your quality of life will not suffer much (if at all).

That's why the Fed looks not at the headline PCE, but the core PCE, which is the PCE with the volatile prices of food and energy stripped out. Ben Friedman, an economics professor at Harvard, says the Fed is just trying to influence the economy where it can.

"They're letting the economy respond to movements up or down in oil prices rather than having monetary policy do that," he says.

The PCE and its core number — will be released on June 1.

States take back some economic incentives

7 hours 11 min ago

The state of Missouri recently suspended its incentives program for IBM after the company reported layoffs at a new center it had opened in Columbia. The state said IBM didn't make good on its promise to maintain at least 500 jobs there. Other states are also taking a hard look at economic incentives they granted to businesses to relocate or open new facilities.

The U.S. is facing an egg-tastrophe

7 hours 11 min ago

You may not know it, but we have an egg-tastrophe on our hands. Thanks to bird flu, an estimated 31 million chickens have been killed — that’s 10 percent of the country’s egg-producing poultry.

Randy Pesciotta, vice president of the egg department at Urner Barry, a commodity market news reporting service, says prices for wholesale eggs have almost doubled, and it's the wholesale market that's going to feel the pinch of higher prices first.

Phil Lempert, a food industry analyst for companies like McDonald's, which relies heavily on eggs, notes that the shortage may be difficult.

“About 25 percent of McDonald’s sales rest in breakfast," he says.

And it’s not clear where companies like McDonald's can turn for cheaper eggs. Certainly not from neighbors such as Canada and Mexico — those countries were already buying eggs from the U.S. While there is talk of getting egg-sports from the EU, Pesciotta says there’s a problem. In the U.S., producers wash and refrigerate eggs to protect against salmonella. But the EU vaccinates its chickens and says washing can damage shells, making eggs more vulnerable to bacteria.

Pesciotta says that unless the U.S. and the EU can agree on egg-zactly what makes eggs safe, we may have an egg-pocolypse.

“They produce to their set of rules. We produce to our set of rules," he said, "they’re different.”

Egg-tastrophe

7 hours 11 min ago

You may not know it, but we have an egg-tastrophe on our hands. Thanks to bird flu, an estimated 31 million chickens have been killed — that’s 10 percent of the country’s egg-producing poultry.

Randy Pesciotta, vice president of the egg department at Urner Barry, a commodity market news reporting service, says prices for wholesale eggs have almost doubled, and it's the wholesale market that's going to feel the pinch of higher prices first.

Phil Lempert, a food industry analyst for companies like McDonald's, which relies heavily on eggs, notes that the shortage may be difficult.

“About 25 percent of McDonald’s sales rest in breakfast," he says.

And it’s not clear where companies like McDonald's can turn for cheaper eggs. Certainly not from neighbors such as Canada and Mexico — those countries were already buying eggs from the U.S. While there is talk of getting egg-sports from the EU, Pesciotta says there’s a problem. In the U.S., producers wash and refrigerate eggs to protect against salmonella. But the EU vaccinates its chickens and says washing can damage shells, making eggs more vulnerable to bacteria.

Pesciotta says that unless the U.S. and the EU can agree on egg-zactly what makes eggs safe, we may have an egg-pocolypse.

“They produce to their set of rules. We produce to our set of rules," he said, "they’re different.”

 

Why do companies offer free stuff at the same cost?

7 hours 11 min ago

One of the questions we received from listeners as part of our "I’ve Always Wondered" series is about why companies give you extra for free.

Eileen Lee wrote us to ask: "Why is it that, every once in a while, my favorite brand of shampoo, food or drink gives me an extra 20 percent free?  Why would a company do this?”

Lee is a statistician and demographer who is finishing up and publishing her master’s thesis. She’s a very careful shopper, dissecting special offers and deals. And she’s very particular. For example, her chicken nuggets have to be dinosaur shaped. Why?

“I like biting the heads off,” she says.

Eileen and I are on a virtual shopping date. I’m at my favorite store in Wheaton, Maryland, just outside Washington. She’s at a store near Los Angeles, where she’s from. We head to the shampoo aisle. Eileen spots a get-more-free deal right away.

“Yeah, Organix – they have some oil of Morocco shampoo and it’s 50 percent more free,” she says.

So will she buy it?

“No, I’ve used their stuff before," she says. "I don’t like it. It makes my hair feel weird.”

Eileen’s got a brand of shampoo she likes, and sticks with. Ditto for toilet paper and detergent. We go down aisle after aisle, looking for a get-more-for-less deal she likes. We don’t find any. Hence her question.

“What made me ask the question was that I never fall for that," she says. "If I see an extra 20 percent, and if it’s not the same brand I’ve been using or the same particular series of brands, then I wouldn’t even think of  choosing it.”

So Eileen never goes for those deals. But, turns out, lots of other people do. That’s part of the answer to Eileen’s question.  

“It gives you an effective discount that’s very tangible and enables you to differentiate your product from the others on the shelf," says Ira Kalb, assistant professor of clinical marketing at the Marshall School of Business at the University of Southern Calfornia. "And it sways people to your brand.”

You want consumers to try it and get hooked on it. Pepsi was among the first companies to experiment with get-more-for-free in the 1930s.

“But they hit upon this idea that they would have a package twice the size but they’d sell it for the same price as the Coke, which was a nickel," says Robert Schindler, a professor of marketing at Rutgers University. 

Pepsi promoted the deal with this radio jingle:

 

Back in the grocery store, Eileen says I’ve answered her question. But she’s still not interested in the get-more-for-less deals. Now, manufacturer’s coupons? That’s different.

“Because then I can actually calculate if it’s actually cheaper," she says. "Whereas with the 20 percent free, I have to calculate, OK, what was the normal price and am I getting more product?”     

But that's an I’ve Always Wondered question for another day.

Cannes Film Festival disappoints critics

7 hours 11 min ago

Grantland writer Wesley Morris is at the Cannes Film Festival and fills us in on what’s going on.

On the vibe at Cannes:

The vibe is, “What happened to the movies?” We saw "Mad Max" on the first day, and we’ve been trying to see "Mad Max" ever since. It is amazing. It is the best movie, and very little that we’ve seen since then has been as great, especially in the main competition.

On the artistic direction of the movies being shown:

The financing for these movies has really compromised some of the artistic choices that a filmmaker can make ... You have money coming from all over the world, and it dictates certain things. Like, if you’re a Greek director and you’re getting Irish money, then you have to take Colin Farrell with the money you get, which happened. It happened at a movie this year!

On making movies in different languages:

There are a number of other directors, maybe like six other directors, making movies for the first time or maybe the second time, not in their native language. And the results are kind of mediocre. You wonder if that has something to do with it.

On people getting turned away for not wearing the right thing:

It’s not the scandal that people are making it out to be. It’s not happening every night, but everybody’s got a story about how it happened to them or someone in their party …where you were denied entry because you were not appropriately dressed. It has caused a great deal of consternation and a greater deal of comedy. It is one of the pleasures of coming to this festival. You need some ridiculous thing to happen if you can’t get a great movie.

China dominates beer sales

7 hours 11 min ago

Quick: what's best selling beer in the world?

I'm just going to go ahead and assume you didn't guess Snow.

Bloomberg ranked the top 10 selling beers in the world by market share, and apparently Snow is all the rage in China these days — up just shy of 600 percent in the past decade. Number two, Tsingtao, is also based in China.

Both can be tricky to find here in the states, so you'll have to settle for number three or four, Bud Light and Budweiser.

Weekly Wrap: Inflation, the Federal Reserve and minimum wage

7 hours 11 min ago

Joining Kai to talk about the week's business and economic news are Leigh Gallagher from Fortune and the Wall Street Journal's Sudeep Reddy. The big topics this week: the Consumer Price Index and inflation, Federal Reserve Chair Janet Yellen's speech in Rhode Island and Los Angeles increasing its minimum wage to $15.

A fashionable workout

7 hours 12 min ago

In a fashion world trend known as “athleisure,” clothes that can work at the gym...can also make a fashion statement.

“Leggings and tank tops and sneakers are sort of taking over the style masses,” says Wall Street Journal reporter Elizabeth Holmes. “But you don’t actually have to work out in them. For a lot of people this is just sort of their everyday casual look.”

Popular brands such as Lululemon started making yoga pants outside-of-yoga-class stylish, and high-fashion brands put sneakers and sweatshirts on the runway.

“Suddenly all these different parts of the fashion food chain are participating in the same trend,” Holmes says. “So that’s sort of why we see this ‘peak athleisure' moment.”

Now this moment has become a big business — Bergdorf sells some leggings for more than $400.

“Women are justifying this purchase by saying 'Hey, this is not just something I’m going to sweat in, but it’s something I’m going to brunch in.'” Holmes says.

And it isn't just luxury brands; athletic brands like Under Armour and Adidas are capitalizing on athleisure.

“Every apparel brand out there sees a piece of this pie,” Holmes says. “So if you’re a performance-based company like Nike you can infuse a little more fashion and suddenly attract a broader customer base. Or if you’re a fashion brand, you think ‘Hey, I can make something in spandex!’"

How elite students get elite jobs

8 hours 3 min ago

When we think about the debate over inequality in this country, a central piece of American mythology comes to mind: anyone who works hard, regardless of social status, can get ahead.

But it's not that simple, and people from exclusive or affluent backgrounds often land the most prestigious jobs.

Lauren A. Rivera, an associate professor of management and organizations at Northwestern University’s Kellogg School of Management, has been looking at investment banks, consulting firms and law firms for the last decade for her upcoming book "Pedigree: How Elite Students Get Elite Jobs."

Rivera spent nine months as an ethnographer in one of these top firms, observing every aspect of the hiring process. She points out the firms may be missing out on top talent.

"If you want the best and the brightest regardless of social background, if you're not systematically looking at over half the best and brightest because they don't qualify in terms of social background, that is not necessarily an equitable or open process," she says.

Father John Misty, song and dance man

9 hours 28 min ago

Musicians play a lot of shows and festivals, and these festival gigs often come with contracts.

One common contract is called a "radius clause." A radius clause, in essence, gives the promoter a form of territorial exclusivity, making sure that the performer does not book concerts with competing promoters and venues in nearby areas, which can undermine ticket sales for their main event.

Father John Misty, also known as Josh Tillman, is the former drummer for Fleet Foxes. Tillman has toured on most major festival circuits and knows these clauses well.

"I ended up having to play a way smaller, basically unprofitable album release show because of a radius clause," he says.

"I Love You, Honeybear," his second full-length solo release since leaving Fleet Foxes in 2012, is out Feb. 10 on Sub Pop Records.

Your Wallet: The first thing you ever bought

9 hours 45 min ago

On the next episode of Marketplace Weekend, we're looking at your money across the years.

We want to know: what's the first thing you ever saved up to buy?

Send us your memories of your first purchases, and how much they cost. 

Write to us here, visit the Marketplace Facebook page, or tweet us, we're @MarketplaceWKND

The art of keeping — or spoiling — a TV secret

10 hours 33 sec ago

We've all been there: you fall behind on a TV show, or you're late to catch on to a new streaming series. Someone mentions a plot twist, a character death... maybe you just checked Twitter in the three hours between the time a finale airs on the east and west coasts. Suddenly, it's ruined. Your experience has been spoiled.

In a time of media overload, it's hard to avoid spoilers. It can be equally hard to avoid spoiling things for someone else. It's enough of a cultural phenomenon that there are apps and plug-ins created to help people avoid leaks. Google even has a patent for a spoiler prevention tool.

But spoilers aren't always an accident. People are searching for them. According to Google Trends, searches for "Mad Men" spoilers spike every season:

The same holds true for long running shows, like "The Bachelor":

So maybe we don't hate spoilers as much as we claim? Researchers at the University of California San Diego found that people actually like spoilers — they ask people to read short summaries of stories and then read the real thing, and the results showed greater enjoyment of a story when one already knows the ending.

Still, networks and production companies guard secrets and spoilers about their shows ferociously. The secrecy surrounding the scripts for shows like Breaking Bad and Mad Men is notorious, and in the world of reality television, the effort is even more acute.

No one demonstrates this more clearly than Kris Jenner, who has proven herself to be an incredibly adept manager of her family members' personal lives and connection to the media. as Bruce Jenner began transitioning to live as a woman, the Jenner/Kardashian family focused on preserving every possible exclusive story: Bruce's exclusive ABC interview with Diane Sawyer contained almost no Kardashian commentary — they were saving it for their own special episodes about Bruce to air on E!. And the "Keeping Up With The Kardashians" episodes related to Bruce's transition don't give away many details about the future — that'll be exclusive to Bruce's upcoming documentary.

ABC and other reality shows use the same anti-spoiler tactics employed by the Kardashians to keep the winners of shows like "The Bachelo" a secret, even as bloggers and fans scan social media and tabloids for clues as to what happened in shows that taped months earlier.

While the economic impact of spoilers on scripted or reality shows isn't quite clear — do people end up not watching? do spoilers actually generate more publicity? — it is clear that there's still a premium on preserving the exclusive, for both producers and consumers of content.

PODCAST: Disappearing grocery stores

17 hours 11 min ago

The guessing game over when interest rates will go up ... continues. More on that. Plus, we all know what a 'leap year' is, but what about a 'leap second'? On June 30th, an extra second will be added to the world's clocks to make up for the discord between the earth's rotation and the clocks we humans use. And while it may not seem like much, it's a big deal to the world's markets. Plus, residents in the struggling city of Flint, Michigan, have seen their share of hardship over the years. In addition to a catastrophic loss of manufacturing jobs and subsequent blight, the city is losing its grocery stores, making life even more difficult for its poorest residents.

Grocery exodus has Flint shopping for answers

18 hours 11 min ago

Residents in the struggling town of Flint, Michigan, have seen their share of hardship over the years.

In addition the catastrophic loss of manufacturing jobs and subsequent blight, the city is also struggling to provide groceries to its poorest residents.

Jason Lorenz, a public information officer at Flint City Hall, has a wall map showing the city boundaries. One thing that’s rapidly disappearing from the map are grocery stores.

“Yeah, we had a Kroger that closed, we have a Meijer up on the northwest side of town. Either side of M-21 here were two VG’s. They both closed,” Lorenz says.

Over the past eight months, Flint has seen three groceries close, most recently the Kroger on Davison Road. That means that a city of 100,000 people now has only one major grocery within city limits.

“Flint was a very tough decision for us,” says Kroger spokesman Brandon Barrow. This latest store closure, he says, was simply unavoidable.

Kroger closed the Davison Road location only two weeks after making the announcement. Barrow says the business was simply unsustainable.

“Over the course of nine years, we lost just over $3 million at that particular location.”

According the U.S. Census, more than 40 percent of Flint’s residents live below the poverty line. Many don’t have cars, meaning they are increasingly cut off from fresh groceries.

Bettie Cavendish is disabled and can’t drive. When the Eastside Kroger closed, she started taking the bus to a Walmart located outside the city. 

“It’s a four to-six hour trip, generally, for me,” Cavendish says. “I [also] have to walk a half hour to get to the bus stop, because it doesn't go down the road I'm on. “

And after she’s done all of her shopping, Cavendish says she has to carry all her groceries back home. It’s one of the hardest parts of her week.

"I guess people would think it would be easier because you have the time when you're disabled. But it's a lot harder. They don't make it easier on you at all."

The bus that Cavendish takes is a special grocery route that Flint created as a 90-day test. If the ridership is there, the line may become permanent, says Ed Benning, general manager of Flint’s bus system, the MTA.

Flint MTA opened a special ''Ride to Groceries'' route for 90 days

Adam Allington

I think the ridership will be there, because the need is not going to go away,” Benning says. 

The grocery bus helps, but it only runs weekday hours from 9:30 a.m. to 2:30 p.m., leaving some working people without the chance to shop during the week.

Grocery store exodus has Flint searching for answers

18 hours 11 min ago

Residents in the struggling town of Flint, Michigan have seen their share of hardship over the years.

In addition the catastrophic loss of manufacturing jobs and subsequent blight, the city is also struggling to provide groceries to its poorest residents.

Jason Lorenz is a public information officer at Flint City Hall. On his wall is a map showing the city boundaries. One thing that’s rapidly disappearing from the map are grocery stores.

“Yeah, we had a Kroger that closed, we have a Meijer up on the northwest side of town. Either side of M-21here were two VG’s, they both closed,” Lorenz said.

Over the past eight months, Flint has seen three groceries close. Most recently the Kroger on Davison Road, meaning that a city of 100,000 people now has only one major grocery within city limits.

“Flint was a very tough decision for us,” said Kroger spokesman Brandon Barrow.

This latest store closure, he says, was simply unavoidable.

Kroger closed the Davison Road location only two weeks after making the announcement. Barrow said the business was simply unsustainable.

“Over the course of nine years we lost just over $3 million at that particular location.”

According the U.S. Census, over 40 percent of Flint’s residents live below the poverty line. Many don’t have cars, meaning they are increasingly cut off from fresh groceries.

Bettie Cavendish is disabled and can’t drive. When the Eastside Kroger closed she started taking the bus to a Walmart located outside the city. 

“It’s a 4-6 hour trip, generally for me,” Cavendish said. “I [also] have to walk a half hour to get to the bus stop because it doesn't go down the road I'm on. “

And after she’s done all of her shopping, Cavendish says has to carry all her groceries back home. It’s one of the hardest parts of her week.

"I guess people would think it would be easier because you have the time, when you're disabled.  But it's a lot harder, they don't make it easier on you at all."

Ed Benning is the general manager of Flint’s bus system, the MTA. The bus that Cavendish takes is a special grocery route that Flint created as a test for 90 days. If the ridership is there Benning says the line may become permanent.

Flint MTA opened a special \"Ride to Groceries\" route for 90 days

Adam Allington

I think the ridership will be there, because the need is not going to go away,” Benning said. The grocery bus helps, but even that only runs weekday hours from 9:30 A.M. to 2:30 P.M.

So, if you do have a job, you likely still won’t have the chance to do your shopping during the week.

Insuring governments against disease outbreaks

18 hours 12 min ago

In the wake of the Ebola outbreak in Africa, a new plan has emerged to guard against future risk: insurance for disease outbreaks. The idea is to help protect governments and industry against the costs of pandemics. A San Francisco firm announced $30 million in funding for the idea this week.

Today, nobody can buy an insurance policy that protects them from a pandemic. But by 2017, at least one company promises to have a product on the market. Dr. Richard Wilcox runs the African Risk Capacity (ARC), a company that sells insurance to African countries and is owned by the governmental body the African Union. He says when Ebola hit, countries lacked money for the basics, like public health workers and the ability to quarantine. So Wilcox says they waited, as governments around the globe and philanthropists passed the hat.

“The cost of having to wait for funds to be mobilized abroad is so expensive to their economy, to their vulnerable populations that they protect,” he says.

If a country takes out a policy, it will be able to get cash quickly to support efforts to control outbreaks. Wilcox estimates costs can run into the tens of millions for even cases numbering in the single digits. Aon insurance consultant Dr. Gisele Norris says Ebola has gotten governments, insurers and companies thinking about pandemics in a whole new way.

“Ebola was so instructive in that was a completely unforeseen event. And no one was prepared,” she says. “I think maybe what it brought home was there is a whole world of emerging and re-emerging infectious disease out there.”

The point, says Norris, is that we don’t know what’s going to strike next time, but there will be a next time. With that new thought in mind, she says certain industries like healthcare, aviation, hospitality and higher education are at higher risk and may look for ways to limit their financial exposure. Of course, price will determine the size of any future market. 

In Africa, ARC will sell policies that encourages public health investment. Simply, the more prepared for an epidemic, the lower its premiums—perhaps a model for industry as well.

 

 

 

 

The 'leap second' — another Y2K moment?

18 hours 12 min ago

On June 30, at midnight Greenwich Mean Time/Coordinated Universal Time, an extra second will be added to the world’s master clocks so that they sync up with the earth’s rotation, which does not precisely match the clocks and computers we earthlings use.

Financial exchanges and firms that depend on precise pricing and transaction data are planning for this so-called "leap second" down the micro-second.

“It’s a big issue for financial firms,” says Victor Yodaiken, whose software firm, FSMLabs, provides time-synchronization computer applications to those firms. “A whole second is a long time. Software is really not set up to see time go backwards.”

U.S.-based exchanges have a deadline of Friday to submit their plans for dealing with the leap second to the U.S. Commodity Futures Trading Commission.

Yodaiken says high-frequency traders are particularly sensitive to the problem because of their automated algorithms.

Meanwhile, U.S. exchanges and those in Asia (Japan, Australia, Singapore and South Korea) will adjust to the extra second by spreading it out over a longer period or adding it later in the day. “During the trading day, their clocks will be different,” says programmer-analyst Steve Allen at the University of California’s Lick Observatory. He is dealing with an automated telescope that will have to adjust to the leap second. “There will be moments during that day when transactions from one market to another seem to come from the future.”

Some U.S. exchanges will pause around the leap second as a precaution or will halt after-hours trading beforehand.

Another Y2K moment? The 'leap second.'

18 hours 12 min ago

On June 30, 2015, at midnight Greenwich Mean Time/Coordinated Universal Time, an extra second will be added to the world’s master clocks. That’s to sync up with the earth’s rotation, which does not precisely match the clocks and computers we earthlings use.

This so-called ‘leap second’ is being planned for by financial exchanges and firms that depend on precise pricing and transaction data, down the micro-second.

“It’s a big issue for financial firms,” says Victor Yodaiken, whose software firm, FSMLabs, provides time-synchronization computer applications to those firms. “A whole second is a long time. Software is really not set up to see time go backwards.”

U.S.-based exchanges have a deadline of Friday, May 22, to submit their plans for dealing with the leap second to the U.S. Commodity Futures Trading Commission.

Yodaiken says high-frequency traders are particularly sensitive to the problem because of their automated algorithms.

Meanwhile, U.S. exchanges and those in Asia (Japan, Australia, Singapore and South Korea) will adjust to the extra second differently—spreading it out over a longer period, or adding it later in the day. “During the trading day, their clocks will be different,” says programmer-analyst Steve Allen at the University of California’s Lick Observatory. He is dealing with an automated telescope that will have to adjust to the leap second. “There will be moments during that day when transactions from one market to another seem to come from the future.”

Some U.S. exchanges will pause around the leap second as a precaution, or will halt after-hours trading beforehand.

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