Marketplace - American Public Media

In his years as a satellite-TV pioneer, Charles Ergen has rarely shied away from a fight. The CEO of Dish Network kicked up a corporate storm today with a $25.5 billion bid to buy Sprint Nextel. Ergen compared the bid to an episode of "Seinfeld": a seemingly random series of events that ties together in the end.

After all, Dish is a TV company and Sprint is in the phone business. Still, Scott Cleland, president of telecom research firm, Precursor, says the deal makes sense. "It would make both companies stronger," he notes. Cleland says Ergen is hungry for more broadband capacity and Sprint has a lot of it. "He sees an opportunity to have a bundled offering of satellite TV and wireless broadband and voice service."

That's the triple threat. AT&T and Verizon have a head start in that department, but acquiring Sprint could make Dish a contender.

"By combining the two companies, they get a scale close to an AT&T and a and diversify and expand their business," says telecom industry consultant, Chetan Sharma. The Sprint deal could allow Dish to stay nimble at a time when the industry is in flux. Sharma says no one knows how we’ll be consuming media in five years, but we do know it will involve wireless.

There are potential bumps in the road. Sprint is in the middle of a buy-out deal with Japanese company, Softbank. But Cleland says Ergen can't be counted out.

"He's pretty much the shrewdest CEO out there," he says. "He's built a company from nothing by playing his poker chips very well.

In addition to being a Seinfeld fan, Ergen was a professional poker player.

There's a handful of economists, maybe a dozen or two, whoare recognizable by name. Raj Chetty likely isn't one of them. At 29, he was the youngest tenured professor in the history of the economics department at Harvard. Now, at the age of 33, he's got a MacArthur Genius award and this past Friday he won the John Bates Clark Medal given by the American Economic Association to the best economist in the country under 40.

Chetty uses real-world experiments to challenge traditional assumptions of economics. One study he did took place at a grocery store. The goal of the experiment was to gather data about how we think about taxes.

Think of the last time you bought shampoo. Did you calculate what it would cost with sales tax?

"So the traditional assumption in economics," says Raj Chetty, "is that you are keeping such taxes in mind when you make purchasing decisions."

Chetty wanted to test that assumption, so he set up an experiment. He went to a large grocery store chain in California and asked if he could put special price tags on items.

"We added these tags that said $7.99 plus California sales tax equals whatever the price of the item was," Chetty says.

The owners limited the experiment to hair care and cosmetics. They assumed the price tags would cause customers to buy less. This assumption is the opposite of what traditional economic theory tells us. It turns out the store owners were right.

"We ended up finding that demand for these products fell by 8 or 10 percent," Chetty says. "So it was as if everybody was ignoring the tax before we put these tags on." Chetty says.

What sets Chetty apart from many of his colleagues is that he comes up with creative ways of using data to understand how the economy works. Henry Aaron is an economist at the Brookings Institution. He says Chetty has a unique ability to look at data sets and ask the right questions.

"And when you marry those two you get results to which people pay attention and I think that's been the case with Raj Chetty," Aaron says.

For policy makers, Chetty's studies of real-life economic behavior could be a very useful tool.

Venezuelans elected a president over the weekend. Nicolas Maduro, the hand-picked successor of Hugo Chavez won a narrow victory over Henrique Capriles, a pro-business candidate.

And on the Monday after the elections? "It's rather quiet everywhere," says Daniel Duquenal, a blogger and small business owner based in Yaracuy. "And that also happened last year when Chavez was reelected. On that Monday, it was more like a funeral, the mood, than any victory celebration."

Duquenal has been critical of Chavez's government in posts he has written over the last ten years. He also acknowledges that "whoever won would be faced with very difficult choices," as Venezuela continues to weather a rocky economy. But he had hoped that under Capriles, Venezuela would end Cuban aid -- which reaches into the billions of dollars -- and weapon purchases. Duquenal sites these as sources of graft and corruption in the country. Even if Capriles couldn't balance the budget, it would be more manageable.

As a business owner, Duquenal expects more of the same -- a tough economy in which to do business in. "Whatever profits my business did last year has been completely wiped out and we're in obligation to reduce our payroll."

How does he stay optimistic? He feels he has to. "You do have an obligation to your employees. I can be extremely depressed but I still need to go and fight because I need to make payroll." Even though about half his employees are Chavistas and supporters of the newly elected president.

There's lots of i-dotting and and t-crossing going on right now on Capitol Hill as the big immigration reform bill gets ready for its big reveal on Tuesday. One of the last issues that does seem to have been worked out is what to do about farm workers. Of the one million farmworkers nationwide, somewhere between 50 and 80 percent are thought to be here illegally.

So, what might the immigration compromise look like down on the farm?

When I asked Peter Osterkamp, he was finishing up paying a bunch of fertilizer bills, and about to head out to check on his onion and sugar beet fields. Osterkamp is a fourth generation farmer in southern California’s Imperial Valley, and has about 30 employees.

He says he decided the current immigration system was broken when, a few years ago, he wanted to promote a temporary worker -- “so bright, so intelligent and willing to work so hard,” Osterkamp says -- in to a full-time job, but discovered the man had entered the U.S. illegally.

Because Osterkamp says it can be hard to find people willing to work the grueling hours and hard labor involved with farm work, he wanted to see if he could get a work visa for the man.

Osterkamp says he spent hours trying to navigate the H-2A visa program which currently provides a very limited amount of visas to immigrant farm workers, to “and the answer was always sorry, there's nothing we can do.”

That would change under the current farm-worker proposal recently hashed out between U.S. farmer groups and the United Farm Workers. It would allow all farm workers already here without documents to apply for temporary legal status if they stay in agriculture for five years. Diana Tellefson Torres, executive director of the UFW Foundation, says that would be good not just for farmers, but also for their workers.

“They’ll be able to work in the fields without fear of getting deported immediately,” says Tellefson Torres. “When there are injustices at the work place, they're not going to have to think ‘Well, I don't have my documents and so I can't speak about what's going on right now.”

The compromise would also increase the number of new visas open to immigrant farm workers each year, and allow those workers to change employers, rather than be tied to a single farming operation. 

The idea of having a new “free-floating” pool of immigrant farm labor, and how to regulate that pool,  raises a new set of questions for the agricultural economy and beyond, says Philip Martin, an immigration economist at University of California, Davis. 

“What's going to prevent me, because I'm legally in the U.S., from going and working in construction as opposed to agriculture, because I can make more money?” Martin says.  “In theory, my work permit is only good for agriculture, but I don't know exactly how we're going to monitor that.”

These are just the sorts of details that the Senate and regulators would need to hammer out in the coming months, if the compromise is going to last.

Every Monday, one Marketplace staff member offers their favorite stories from the past week. Here’s a quick hit of some of the things that caught my ear on the Marketplace airwaves recently.

• Should you include your race on your resume? Not something I’ve thought much about. As a white person, it’s easy to think sometimes that we’ve achieved a color-blind society. But of course, race can still play a major role in the workplace. We tackled the topic on last weekend’s Marketplace Money.

• With the passing of Britain’s Iron Lady Margaret Thatcher, we came up with a couple of nice ways on the PM program to look at her economic legacy and have a bit of fun.

• I was happy to hear that innovation is not just the purview of the young in an interview done by Jeremy Hobson on Marketplace Morning Report on Monday.

• While we’re on the topic of innovation, our sustainability reporter Scott Tong did a nice spot on Tuesday’s afternoon show about what the impending bankruptcy of Fisker motors says about differences towards innovation on the East versus West Coasts. I liked this story a lot because Scott had a really original angle that I wasn’t hearing anywhere else in the coverage of Fisker’s woes.

• We took a more tech-focused look at Fisker with David Brancaccio and our Marketplace Tech cast.

• Pausing for a moment for a nod to a really strong freelance piece on Thursday: Youth Radio’s enterprise reporting on what it’s like to have a juvenile record and be looking for work. I thought this piece had strong voices and gave me a great sense of how mistakes made at a young age can cost you so much.

• And finally, to end on a light note: Sabri Ben-Achour did a fun piece on the lunatics, uh athletes, who run the North Pole marathon and how much it costs to pull it off.

The Dish TV Network  is making a big bid to get into the mobile space. It wants to buy the country’s third largest cellphone carrier Sprint-Nextel for more than $25 billion.

It's no surprise that Google is expanding, and one place where they are growing fast is New York City. The company's offices, which are located in the downtown Meat Packing neighborhood, feel part warehouse, part office building, and part elementary school. Chief Information Officer Ben Fried takes us on a tour of Google's East Coast headquarters and discusses how its culture differs from Silicon Valley.

The Dish TV Network this morning is making a big bid to get into the mobile space. It wants to buy the country’s third largest cellphone carrier Sprint-Nextel for more than $25 billion.

Dish Network is trying to steal Sprint Nextel from the clutches of another bidder: The Japanese telecom giant Softbank.

Dish is upping the price by $5 billion or so. Why? Jeff Silva at Medley Global Advisors says it wants to expand beyond the slow-growing TV business. It faces competition from cable, cellular and Internet streaming. 

"There’s Netflix out there. You’ve got some real headwinds for profits and gaining market share," says Silva.

Dish wants to offer customers everything -- voice, TV, mobile. Thing is, the dominant mobile players are already there. So time matters, and an acquisition takes time.

"Verizon and AT&T are expanding their LTE networks that have faster connections. And by the time it’s done they could have locked down a lot more customers," he says.

If Sprint Nextel doesn’t take this offer, Dish Network is believed to set its sights on other wireless carriers, like Clearwire and T-Mobile.

It's no surprise that Google is expanding, and one place where they are growing is New York City. The company's offices, which are located in the downtown Meat Packing neighborhood, feel part warehouse, part office building, and part elementary school.

Chief Information Officer Ben Fried joined Marketplace Morning Report host Jeremy Hobson for a tour of Google's East Coast headquarters and to discuss how its culture differs from Silicon Valley.

On the competition for talent:

Fried: "The quest for technology talent is really a global one. Great engineers, great product managers, great technologists, great sales people, are in short supply. And creating a workplace that’s appealing to them is really important."

On the difference between a career in finance and tech:

Fried: "There are a number of differences that I think are all worth calling out. They largely start with the idea that Google is designed to become a product engineering company. And that dedication to building great products and doing great engineering, it drives so many other elements of the culture, wanting to be a place that inspires needs, develops great engineers. Morgan Stanley and finance were great places where computer science was incredibly important, but they weren’t the business of the company."

On New York versus Silicon Valley:

Fried: "New York is an interesting place because there are so many industries that are so big here, and technology has a role influencing all of them. I’d like to see New York develop as a city with a technology industry that can harmonize with the other industries that are successful here and at the same time have all this great product."

Click on the audio player above to hear more about Google's New York offices.

The deadline for filing income taxes is today, and while a third of Americans like doing their taxes and some are even inspired to write poetry, many find the process more complicated than ever.

Stephen Dubner of Freakonomics tells us what one British government unit is doing to help make paying taxes a little more...fun.

Here in this country, there are few things more divisive than taxes. Many Americans feel they pay too much, and get too little in return. But is that true? Derek Thompson, senior editor at The Atlantic, helped us take a look at how U.S. taxes stack up to other countries around the world -- and the results may surprise you.

Of course, your tax dollars pay for things like pensions, police and firefighters -- services that uphold community safety and maintain the peace. But when it gets down to the day-to-day budget, where does your locality put all the money?

And before your town or city can even think about spending, the IRS has to make its collections -- which can be tough as scammers abound. This year, identity theft ranks as the worst tax scheme. Check out which scams made the top 12 on IRS's 2013  "Dirty Dozen" list.

After you steer clear of those, learn how to avoid an audit. Here's a hint: Avoid round numbers. And, while you're at it, just say no to joint tax filing. Anne Alstott, professor of tax Law at Yale, says tax laws are stuck watching reruns of "Leave it to Beaver" while the rest of us have long since moved on to "Modern Family" -- which generates arbitrary tax penalties and bonuses.

And before you say good-bye to tax season, this final piece of advice from a tax accountant in Colorado, "the easier you make your accountant's life, the cheaper your [filing] price will be." But there can be bonus points for cute pets and outlandish excuses.

China’s economy -- the world’s second largest -- has slowed  from an annual growth rate of  7.9 percent  to 7.7 percent. Meanwhile India’s inflation rate has declined to a three year low of 6 percent. These figures have been partly reflected in the plummeting price of gold -- a traditional hedge against inflation. 

After a dazzling rise to more than $1,900 an ounce, the yellow metal has clearly lost its luster. The price of bullion has slumped by 10 percent since the end of last week, down to $1,420 an ounce. 

"It's not just gold," says Julia Coronado, chief economist at BNP Paribas. "Commodity prices, like oil, are falling and other investments that are tied to inflation."

Gold had been driven up by fears that money printing by central banks would devalue paper currencies. But China’s slowing growth and India’s cooling inflation rate suggest otherwise. A falling price of gold might suggest that inflationary fears are abating.

Rupert Nathan, metal analyst at the financial website Fat Prophets, thinks the price of bullion could have further to fall, but he doesn't believe it will fall through the floor. He says that Japan has just embarked on a major round of money printing. And there’s enough political tension over North Korea to underpin bullion as the ultimate safe haven.

Before you sign that tax form today, are you sure there's nothing in your email inbox that might contradict what you’ve entered? New documents suggest the Internal Revenue Service (IRS) believes it doesn't need a warrant to look through email when investigating possible tax cheats.

"What we are talking about is only what the IRS thinks it has authority to do in its criminal investigations," says Nathan Freed Wessler, staff attorney at the ACLU's Speech, Privacy, and Technology Project. "It appears from all the documents that we reviewed and from their statements, that they still claim the authority to read at least some emails without getting a warrant from a judge."

The Electronic Communications Privacy Act, which governs this area, was passed in 1986 before the World Wide Web took hold. Critics point to many anomalies in the law, including the way it treats email stored on remote computers -- the Cloud -- as less private than email stored on a home computer. But in 2010, a federal court found that the government needs a court order to look at email in certain cases.

"So what the IRS believes today is a little less clear," says Purdue computer science professor Christopher Clifton. Clifton says much of the issue revolves around our expectations of privacy. If we expect something is private, it stands a greater chance of being protected from unreasonable searches by the Fourth Amendment of the Constitution.

Would you rather have a teacher or a computer grade your schoolwork?

EdX, a Harvard-MIT project, will offer essay grading software to colleges free of charge. You might imagine that teachers and professors, who often have to tackle a pile of student essays as high an elephant's eye, would embrace the labor saving. But, not all professors do.

Jonathan Zittrain, professor of law and computer science at Harvard, joins Marketplace Tech host to explain how the computer program works and whether it measures up to the human eye. 

Today is the deadline for companies that make products for Wal-Mart to tell the retail giant exactly which factories they work with. The requirement comes after a fire at a clothing factory in Bangladesh last year killed more than a hundred people.

Wal-Mart says it never knew its products were being made at the factory that burned down. Now the company says it's going to cut ties with suppliers who use unauthorized factories, and the retail giant is donating $1.6 million to a new safety academy for factory managers in Bangladesh.

“Even though this not revolutionary by itself, it’s indeed a signal that Wal-Mart is trying to adopt a more progressive view on sustainability," says Edgar Blanco, who studies supply chain management at MIT.

Blanco thinks big companies should actively hunt for abuses in the farthest reaches of their supply chains. He adds that, as the world’s largest retailer, Wal-Mart could set a new standard.

But at the Institute for Global Labor and Human Rights, director Charles Kernaghan isn’t sure.

“I don’t want to be a downer on stuff like this, but we just have not seen Wal-Mart take the lead, ever -- not on wages, not on the right to organize, not on health and safety,” says Kernaghan.  “But we can hope can hope that they do make a serious commitment and that they keep at it.”

Wal-Mart told Marketplace in a statement that it knows “continued engagement is critical.”

Every tax season the Internal Revenue Service puts out a list called the "Dirty Dozen" which ranks the worst tax schemes of the year. In 2013, identity theft is the dirtiest of them all. The U.S. Treasury Inspector General for Tax Administration says identity theft could cost the IRS $21 billion over the next five years.

"There's a shift in some organized crime from drugs to tax-ID theft, and the increased use of electronic filing may contribute as well," says the Federal Trade Commission's Lisa Schifferle. Her agency does consumer outreach on the issue. 

This is how the tax scheme might go: Someone steals your Social Security number, files a tax return on your behalf, and then collects your refund. It takes a victim nearly 200 days on average to get the refund they deserve from the IRS.

"They're ripping their hair out," says Adam Levin, chairman of the identity recovery company IDentity Theft 911.  "This is an extremely difficult situation."

Congress is considering a law to force the IRS to move faster. But according to Levin, the problem is too big.

"If you're on the wrong database at the wrong moment when the wrong person gains access, you're toast," he says.

The IRS says it has more than doubled its staff -- to more than 3,000 employees -- working on identity theft this year.

The IRS "Dirty Dozen" list of tax scams for 2013:

1. Identity theft: Identity theft occurs when someone uses your personal information such as your name, Social Security number (SSN) or other identifying information, without your permission, to commit fraud or other crimes.

2. Phishing: A scam typically carried out with an unsolicited email or a fake website that poses as a legitimate site to lure in potential victims and prompt them to provide valuable personal and financial information.

3. Return Preparer Fraud: About 60 percent of taxpayers will use tax professionals this year to prepare their tax returns. Most return preparers provide honest service to their clients. But some preparers prey on unsuspecting taxpayers, and the result can be refund fraud or identity theft.

4. Hiding Income Offshore: Over the years, numerous individuals have been identified as evading U.S. taxes by hiding income in offshore banks. Others have employed foreign trusts, employee-leasing schemes, private annuities or insurance plans for the same purpose.

5. “Free Money” from the IRS: Flyers and advertisements for free money from the IRS, suggesting that the taxpayer can file a tax return with little or no documentation, have been appearing in community churches around the country. These schemes promise refunds to people who have little or no income and normally don’t have a tax filing requirement.

6. Impersonation of Charitable Organizations: Following major disasters, it’s common for scam artists to impersonate charities to get money or private information from well-intentioned taxpayers.

7. False/Inflated Income and Expenses: Including income that was never earned, either as wages or as self-employment income in order to maximize refundable credits, such as the Earned Income Tax Credit, is another popular scam.

8. False Form 1099 Refund Claims: In this ongoing scam, the perpetrator files a fake information return, such as a Form 1099 Original Issue Discount (OID), to justify a false refund claim on a corresponding tax return.

9. Frivolous Arguments: Promoters of frivolous schemes encourage taxpayers to make unreasonable and outlandish claims to avoid paying the taxes they owe. The IRS has a list of frivolous tax arguments that taxpayers should avoid.

10. Falsely Claiming Zero Wages: Typically, a Form 4852 (Substitute Form W-2) or a “corrected” Form 1099 is used as a way to improperly reduce taxable income to zero. The taxpayer may also submit a statement rebutting wages and taxes reported by a payer to the IRS.

11. Disguised Corporate Ownership: Third parties are improperly used to request employer identification numbers and form corporations that obscure the true ownership of the business. These entities can be used to underreport income, claim fictitious deductions, avoid filing tax returns, participate in listed transactions and facilitate money laundering and financial crimes.

12. Misuse of Trusts: While there are legitimate uses of trusts in tax and estate planning, some highly questionable transactions promise reduction of income subject to tax, deductions for personal expenses and reduced estate or gift taxes.

China’s economy continues to rev, but certainly slower than many had anticipated this past quarter. Growth came in at 7.7 percent, down two tenths from the previous quarter.

China’s growth in factory goods production grew slower than expected. Same story with steel and electricity. It surprised some market types, but not Shaun Breslin at the University of Warwick in London. In a wobbly world economy, China’s exports have taken a hit.

"Demand just isn’t picking up in Europe. So they’re not able to export themselves into high levels of growth," says Breslin.

But Breslin’s not that surprised by the hiccup. He says in the long-term, China’s trying to move to a more consumer-based economy -- which as he sees it, is slower and more steady.

"Rather than growth driven either by exports, or heavy investment in infrastructure as it has been in the last few years, because that’s not sustainable," he says. 

This final note on tax day. A statement from Rep. Dave Camp, Republican of Michigan.

"It takes the average American taxpayer," Camp said, "13 hours to comply with the tax code, gathering receipts, reading the rules, and filling out forms the IRS requires. The tax code forces Americans to spend over $168 billion to comply and six billion hours."

The Washington Post did some fact-checking...turns out, Representative Camp is pretty much right on the money.

Which you kinda knew it your gut, didn't you?

A secret report leaked to the Greek press suggested that with one bound, Greece could be free of all its debts. The report, compiled on the orders of the Greek Ministry of Finance, argued the country has a valid claim for war reparations from Germany.

How much is that claim worth? In the neighborhood of $210 billion.

“This is a huge amount of money," says Gerasimos Georgatos of the Democratic Left, one of the governing parties in Greece. “This is almost 80 percent of our GDP. That means we have no more problem with the debt if we get this money. It’s very big money."

Georgatos thinks the figure is unrealistic, but a panel of experts came up with it after poring over thousands of pages of documents from government archives. The experts concluded Germany still owes Greece compensation for the havoc wreaked during the Nazi occupation from 1941 to 1944. More than 300,000 people died — many through starvation. Fifty percent of Greece's infrastructure and 75 percent of its industry were destroyed.

The German Finance Ministry has cried foul on the reparations claim, pointing out that compensation was paid to Greece in the 1960s. Hans Olaf Henkel, a leading German industrialist, says Germany is no longer liable for war damage to Greece, at least financially.

“Morally you will — as a German — never be able to say: we completed our obligations. Never, ever,” Henkel says. “But financially, I think everything has been settled."

Henkel, who is an arch opponent of the euro, says dragging up the reparations claim underscores how much the single currency has backfired. The euro was supposed to promote peace and  harmony in Europe but, Henkel argues, it is souring relations between member states.

The reparations claim is straining relations between Greece and its paymaster Germany and could further erode the German public’s support for bailing out Greece. For that reason, the report could be shelved.

A Greek government official was quoted saying: “This is no time to pick a fight with Berlin.”

North Korea's recent threats to test launch medium-range missiles and pursue its nuclear ambitions is alarming the U.S. and many other countries. Marketplace’s partner organization, the BBC, has reporters in a number of countries surrounding North Korea. We have their reports on the mood in three economically significant nearby locations: Beijing, China; Tokyo, Japan; and Seoul, South Korea.

Celia Hatton in Beijing
Chinese diplomats have their hands full dealing with rising tensions on the Korean Peninsula but so far, business people in China are carrying on as normal. The customs office in Dandong, the Chinese city that lies on the North Korean border, confirms trade is unaffected, except for the suspension of Chinese tourist visits to North Korea. Chinese businessmen were even invited to Pyongyang this week to celebrate the birthday of North Korea’s founder, Kim Il Sung.

Some believe Chinese leaders have already decided North Korea is becoming a strategic liability and they’re predicting a change to China’s North Korea policy but others are pressuring Beijing to maintain the status quo with Pyongyang.

North Korea accounts for just 1 percent of Chinese trade -- a drop in the bucket for China but a lifeline for people living in China’s poor Northeastern provinces along the North Korean border. They are hoping China’s leaders will continue to support the regime of Kim Jong Un.

Martin Patience in Tokyo
Japan is taking no chances. The government has placed Patriot missiles at three locations in the capital with orders to shoot down any North Korean missiles heading towards the country. Out at sea, Japanese warships have been rigged out with missile defense equipment.

Despite this, the mood in Tokyo is relaxed. There’s certainly no sense of panic. Japan has been in this situation before. Most believe that Japan and U.S. bases in the country will not be targeted but North Korea is an unpredictable regime and nobody is sure what it will do next.

As for Japan’s economy, there have been no jitters so far but that could well change if tensions escalate further. Most Japanese believe that this crisis will blow over, just as past crises have. Even so, the batteries of Patriot missiles stationed around Tokyo stand as a stark reminder of North Korea’s threats.

John Sudworth in Seoul, South Korea
So far, as with previous crises, there is no sign of panic in South Korea. Seoul is as busy and bustling as ever. People are going to work. Cafes, bars and restaurants are full. The stock exchange is also largely unaffected. It priced in the threat from North Korea long ago.

That threat is seen as minimal. North Korea, most believe, has no interest in starting a war it knows it would lose and lose and lose quickly.

There is a sense of watchfulness from the South Korean government and perhaps, an added frisson of uncertainty given that North Korea now has a young, inexperienced leader at the helm, who is an unknown quantity.

One commentator pondering the recent international news coverage of the situation observed: “the level of alarm grows greater the further from Korea you get.”

A few years ago, it cost Steve Jobs $100,000 to sequence his DNA; today you can get it done for less than $10,000.

This weekend marks the 10th anniversary of sequencing the first human genome, and the economics of DNA sequencing has shifted so dramatically that many say the next big thing in health care -- personalized medicine -- is already here.

Top-tier hospitals like the Children’s Hospital of Philadelphia, or CHOP, are quickly moving this technology out of the research lab into the doctor’s office as they race to get to in on the ground floor of what promises to be a billion dollar industry. You would think the new genetics lab at CHOP would look like some futuristic sci-fi movie set…with gleaming chrome tools and oversized computer screens.

Nope. Just a drab, gray room buried in a basement. Even the super, sophisticated $750,000 DNA sequencer looks dull.

“It really looks like a box,” says Dr. Nancy Spinner, who oversees this unremarkable-looking laboratory. But Spinner says what happens inside the box is magic.

“It is truly amazing. It has completely changed the kind of experiments we can do,” she says.

This DNA sequencer reads about 3 billion bits -- your genetic blueprint -- and creates a digital copy in 48 hours.

That’s what it did for Leta Moseley. The 15-year old is tiny, just 3 foot 8, 66 pounds. She can’t speak and she struggles with lung disease that can turn a simple cold into a life-threatening event. Since Leta was born, her parents Rick and Lainey and an army of doctors have searched for the cause of her condition. A few months ago they found it, thanks to that ‘box' in the basement.

Dr. Ian Krantz was able to identify the mutation that caused Leta’s rare disease. “The new paradigm is going to be these genome-wide tests where you can screen all of the genes or most of the genes in a single test. The possibilities are as much as we can imagine them,” says Krantz.

The diagnosis is a genuine breakthrough -- it’s not a cure for her daughter. Lainey Moseley says it’s a different kind of gift.

“I had always felt personally guilty that doubt, well did I do something wrong in my pregnancy. Did I cause this? And finding this diagnosis in some ways let me off the hook a little bit. It wasn’t my fault,” she says.

The sheer power of DNA sequencing has top hospitals falling over themselves investing tens of millions of dollars to get into this business. Dr. Robert Doms says his bosses at CHOP didn’t blink when he submitted his business plan to set up a DNA sequencing center.

“I think they cut one secretary, but otherwise, otherwise they gave me everything I ask for. Of course, now I have to be successful,” he says.

Success here in Philadelphia means that within a year, CHOP will have a genetics team of 50. The program will attract children with rare diseases and cancer from around the country for in-house testing, research work and genetic counseling.

But CHOP and others like Boston Children’s Hospital and Children’s Mercy in Kansas City and are betting those patients are just the beginning. There’s chatter in genomic circles that within a few years every fetus be sequenced.

“DNA sequencing testing is going to be a $20 billion industry within the next several years,” says Mary-Ellen Cortizas, who helps run the DNA sequencing business for Boston Children’s Hospital. Cortizas says hospitals are scrambling to develop the fastest, cheapest test out there.

“This is a race to who does this best, but what does best mean?” she asks. “Is it the cheapest sequencing, the fastest sequencing or the sequencing that is most useful for the patients?”

While the market for these tests is emerging, hospitals face challenges. Dr. Leonard Sender is the director of the Genomic Center at Children’s Hospital of Orange County. He says the tests aren’t much good if you don’t have the staff to help patients make sense of the results.

“Do we have enough genetic counselors? Do we have enough genetic-trained pediatricians?” asks Sender. “There is a tremendous problem in getting the education of this new field to the health care professional.”

And without that education, it’s easy to imagine doctor’s ordering tests that don’t lead to much, other than more costs. Dr. Eric Topol who oversees genetic work for Scripps Health in San Diego says that’ll never fly.

“Nothing is going to work and be accepted now, unless it not only improves patient outcomes, but also markedly reduce the cost of the care,” he says.

Topol says the potential to save money is there. Look at Leta’s case. Over the years, she underwent roughly $100,000 worth of genetic testing. The successful one was under $10,000. Leta’s mom, Lainey Moseley, says that’s not the only way to think about cost.

“There’s so much that falls apart in a normal family life because you are living a very medical life. So if other families didn’t have to go through that kind of medical odyssey, it would save a lot of people’s lives in a lot of ways,” she says.

Moseley says it’s unlikely the discovery of Leta’s condition will help her. But it’s clear the technology that solved her medical mystery has the power to provide answers that until now have been out of reach.

Updated (9:30am EST): Friday morning, megabanks JPMorgan Chase and Wells Fargo reported positive earnings. Wells Fargo said its profits were up 23 percent last quarter, and at JPMorgan Chase, profits jumped 34 percent compared with a year ago.

Big banks have come a long way from when they and the entire financial system were on the verge of collapse. Major U.S. banks have largely had healthy balance sheets recently, with record profits. This leaves Americans to wonder whether it’s finally safe to let go of fears that they could again threaten to fail and drag the entire economy down with them.

“I definitely don’t think there’s nearly as much to worry about now as there was five or six years ago,” says Morningstar bank analyst Jim Sinegal. “Capital levels at all of the big banks have doubled, tripled or even more since the depths of the financial crisis.”

When there’s literally more money in the bank, there’s less worry about catastrophe. Banks are playing it safer in a number of ways, including much tighter lending standards. (Too strict, in the view of some small business owners, who are frustrated about not being able to get adequate loans for expansion.)

It’s nice to be healthy when the overall economy is recovering. And the big banks did survive the Fed’s latest simulated crisis -- but that’s not the real test.

“We will only find out whether the new situation now is a better one for the country, for the economy, for the consumer when the next crisis comes by,” reminds Mauro Guillen, director of the Lauder Institute at the University of Pennsylvania’s Wharton School.

Click here to hear analysis from Nancy Bush, contribuing editor at SNL Financial.

Mark Garrison: With record profits on the books, life is certainly a lot better for the largest banks.

Jim Sinegal: I definitely don’t think there’s nearly as much to worry about now as there was five or six years ago.

Jim Sinegal is a Morningstar bank analyst. These companies are playing it safer in several ways. For one, there is literally more money in the banks.

Sinegal: Capital levels at all of the big banks have doubled, tripled or even more since the depths of the financial crisis. And that’s the biggest thing contributing to the safety of the financial system.

It’s one thing to be healthy when the economy is recovering. And the big banks did survive the Fed’s latest simulated crisis. But Mauro Guillen of the University of Pennsylvania’s Wharton School has a reminder.

Mauro Guillen: We will only find out whether the new situation now is a better one for the country, for the economy, for the consumer when the next crisis comes by.

It’ll take more than quarterly earnings reports to figure that out. In New York, I'm Mark Garrison, for Marketplace.