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Authored by Mark Hendrickson, op-ed via The Epoch Times,

About 60 years ago, Sen. Everett Dirksen (R-Ill.) uttered the famous quip, “A billion here, a billion there, and pretty soon you’re talking about real money.”

Has politics in Washington changed much in the six decades since? Yes and no. No, the same cavalier attitude about spending other people’s money rages on unchecked. Yes, the scale has changed drastically. Today the refrain is, a trillion here, a trillion there.

“Trillion” is a simple word. It rolls effortlessly off the tongue. But the word’s simplicity belies the immensity that it signifies. If you stacked one-hundred-dollar bills flat on top of each other, a million dollars would be about 40 inches tall, a billion would be more than twice the height of the Empire State Building, and a trillion would rise over 631 miles. If those were one-dollar bills instead of hundreds, the pile (again, stacked flat on top of each other) would, if laid on its side, circle the Earth at the equator more than 2.5 times. In terms of time, if a you had been spending a million dollars a day, every day since the birth of Christ, you still wouldn’t have spent even three-quarters of one trillion dollars.

The first time the entire GDP of the country exceeded $1 trillion, John Kennedy was president. The first time the national debt reached that sum, Ronald Reagan was president. Today, the national debt has soared to over $26 trillion. This summer, Uncle Sam set a record by spending over $1 trillion in a single month.

Today, under the pressure of democratic politics in which government is viewed as a Santa Claus with infinitely deep pockets, the two parties (the party of Big Government—the Republicans—and the party of Bigger Government—the Democratic socialists—never propose freezing, much less (gasp!) shrinking federal spending. The only debate is about how many additional trillions of dollars of debt to add.

Among its other deleterious effects, the coronavirus pandemic has accelerated the pace at which our government is adding to the national debt. Having already authorized at least $2.9 trillion in emergency spending—close to half of which the government hasn’t even disbursed yet, according to Sen. Ron Johnson (R-Wis.)—the current political quarrel is between Republicans prepared to spend $1 trillion more and Democrats who want to spend $3 trillion more.

The sad thing is that even if the pandemic were to disappear tomorrow, the crazed push for more debt would continue. Presumptive Democratic presidential candidate Joe Biden recently unveiled two multi-trillion-dollar spending plans. First, Biden wants to spend $2 trillion in response to climate change (a figure that the democratic socialists in Congress will surely claim is far too small). That pales next to the $7 trillion that Biden says he will use to close the wealth gap between rich and poor, black and white.

The continued spending of trillions of dollars that don’t even exist yet is insane. What we are witnessing is the utter trivialization of money. Money used to be respected. It was a solid symbol that something valuable had been brought into existence by human ingenuity and/or effort. A unit of money represented economic production, the creation of new wealth. Today, our currency has taken on an unserious “Monopoly money” quality. Politicians treat it like a plaything. It doesn’t bother them that they are saddling our children with tens of trillions of dollars of debt. Why worry? It’s only money. Or is it?

The Three ‘F’s’

There are three “F’s” that have enabled the trivialization of money: fiat currency, the Federal Reserve System, and financialization.

The “original [monetary] sin” is the adoption of a fiat currency – “fiat” denoting a money substitute that has no nonmonetary value in the marketplace. Our money used to consist of real economic goods—specifically, gold and silver coins or paper certificates redeemable in gold or silver. The United States went off the gold standard in two stages—in 1933 when FDR ended currency redemption for Americans and in 1971 when Richard Nixon did the same internationally.

When Americans bought and sold goods and services with precious metals (or a paper note redeemable in precious metal) there was an implicit sense, a confidence and security, that they were trading economic value for economic value.

A silver coin had genuine value, whether it was used as money or traded as a commodity. It would have value in the marketplace even in the absence of legal tender laws forcing people to accept it as “money”—unlike the backed-by-nothing-substantial Federal Reserve Notes we are compelled to accept today.

Fiat currencies sooner or later trade at a price that reflects economic reality—the fact that trillions of rectangular pieces of “paper” (actually, a cotton-linen compound), or digital representations thereof, are essentially worthless. (If you doubt this, ask yourself if you would strive to accumulate those pieces of fabric if the government didn’t mandate that they be accepted as “money.”)

The Federal Reserve System, ostensibly created to support monetary stability and to lessen the ups and downs of the business cycle, has evolved into a bizarro monster. Having already seen about 97 percent of the dollar’s purchasing power melt away in its 106 years of operation, today’s Fed strives for a 2 percent inflation rate—that is, it seeks a deliberate devaluation of 2 percent of the buck’s purchasing power year after year. More ominously, the Fed’s main function now is to bail out Uncle Sam whenever our overleveraged financial system threatens to collapse and end the government’s ability to redirect trillions of dollars per year.

To accomplish this goal, the Fed has engineered near-zero interest rates for at least a decade. What has enabled the federal government to continue its profligate overspending is the Fed-engineered freedom from having to pay historically normal rates of interest, thereby shaving hundreds of billions from the federal budget.

The side effects of the Fed having driven interest rates to near zero have been pernicious to our economy. The most important prices in a market economy are interest rates—sometimes called “the price of money,” but, more accurately, the price of capital. Interest rates apportion and coordinate consumption and production between the present and the future. With near-zero interest rates, the time value of money has been more or less obliterated, obscuring vital price signals that entrepreneurs need to help guide their decisions.

Another ill effect of near-zero interest rates is that they essentially create billions and trillions of dollars of “fiat capital,” which is no more real capital than fiat currency is real money. The artificially cheap fiat capital resulting from the Fed’s policies bails out zombie corporations, enabling moribund businesses to stagger on rather than fold. That retards the normal, healthy economic process of valuable economic inputs migrating from relatively uneconomical uses to entrepreneurs starting new businesses.

In short, the Fed has short-circuited the essential self-adjusting feature of the market economy—the “creative destruction” by which stagnant firms die out and vibrant new businesses take their place in the normal cycle of business. This has caused persistent slow growth as we inexorably head toward what I’ve been calling “the Japanization of the American economy.”

The third “f,” financialization, is the natural outcome of the Fed’s exotic monetary manipulations. Taking advantage of trillions of currency units created out of thin air and artificially suppressed interest rates, clever financiers play exotic financial games. In normal economic times, monetary savings supplied the capital that financed the production of new real wealth. Capital was used for the humane purpose of improving standards of living.

Today, though, capital has become a somewhat evanescent phenomenon, a mere abstraction. Financiers devise clever ways to arrange and package this semi-ephemeral thing called “dollars” to make other dollars without producing any real wealth at all. And, as we found out in the 2008 financial crisis, the federal government raced to rescue Wall Street for the completely self-interested reason that without an immense functioning financial infrastructure, Washington’s multi-trillion-dollar spending and redistributing machine would quickly grind to a halt.

Who’s to Blame?

Question: Who deserves the blame for the fiscal insanity of pseudo-money and pseudo-capital? Well, who deprived the American people of real money? The federal government. Who created the deus ex machina known as the Federal Reserve System? Again, the federal government. But it’s just too easy, convenient, and expedient to blame politicians.

The fact is that “we the people” are to blame. A majority of Americans over the past 140 years or so have fallen hook, line, and sinker for the progressive catnip of government being cast in a role of Mommy and Daddy and Santa Claus. A majority of Americans keep voting for government to spend more, more, more. For the politicians, the incentives are plain: Spend more on programs that voters like, or those voters will send you packing.

The traditional abhorrence of government debt was burned into our political DNA by such fiscally honorable presidents as George Washington and Thomas Jefferson. They thought it immoral to spend money today and expect future generations to pay for it. (Are today’s protesters sure they want to cancel out Washington and Lincoln completely?) Today, though, that moral restraint is outdated and defunct. Whether it’s private debt or public, tens of millions of Americans live according to a “consume today, pay for it later (maybe)” ethos. With that being the prevailing mentality, the creation of new Federal Reserve Notes by the trillion will continue until that fateful day when the increasingly brittle debt structure starts to collapse.

And here is some bad news to close with: In early 2019, I warned about Modern Monetary Theory (MMT) as a tool for weakening the private sector and imposing stealth socialism. Surprise! We’re getting a heavy dose of MMT right now. The federal government and Federal Reserve are working hand in hand to conjure up trillions of new fundamentally insubstantial and essentially counterfeit “dollars” for Uncle Sam to spend. All those trillions are adding absolutely nothing to our country’s stock of wealth, but they are making more Americans feel increasingly dependent on Washington.

As is often the case with monetary shenanigans, in the short term, creating additional trillions of fiat dollars doesn’t seem to be doing any harm. And in the long run? The British economist John Maynard Keynes parried that question by glibly replying, “In the long run, we’re all dead.” Well, yes, but a more honest answer is that monetary mischief can cause a lot of pain to a lot of people before they die.

The trivialization of money has far-reaching consequences that are anything but trivial.

Managing editor, Ed Harrison, hosts Marc Chandler, chief market strategist at Bannockburn Global Forex, to discuss currency markets, the dollar’s reserve status, and the world’s loosening grip on the goal of economic efficiency. Chandler and Harrison parse how a seemingly weaker US recovery is expressing itself through currency markets. Chandler also shares his thoughts on why the dollar losing reserve status and the loss of US hegemony are not as compelling by appealing to the dollar’s cyclical trends. Finally, they discuss how nations are reducing their dependency on economic efficiency as the end all, be all, what that looks like, and how the pandemic is catalyzing these trends. In the intro, Nick Correa reviews the latest GDP numbers for the U.S. economy and what implications it has over the next few months.

Former President Barack Obama turned a eulogy for the late Rep. John Lewis (D-GA) into a Democratic political rally – urging Congress to pass a series of measures he said would ‘continue Lewis’ life’s work.’

Of all the speakers at the memorial, the former President was the only one to leverage Lewis’ death for political purposes.

Obama’s proposals included:

– Automatic voter registration.

– Congressional representation for Washington D.C. and Puerto Rico.

– Making election day a federal holiday.

– Ending gerrymandering.

– Replacing the 1965 Voting Rights Act which would restore federal supervision over state efforts to pass election reforms.

– Ending the Senate’s filibuster rule (famously used by Hillary Clinton‘s mentor, Sen. Robert Byrd (VA), against the GOP’s 1964 Civil Rights Act).

“You want to honor John? Let’s honor him by revitalizing the law that he was willing to die for,” Obama said, while later likening President Trump to segregationist Democratic Gov. George Wallace of Alabama, and the police to Civil Rights-era law enforcement officers beating blacks across the South – condemning “sending agents to use tear gas and batons against peaceful demonstrators.”

Wow, Barack Obama is delivering Lewis’s eulogy & this MF had the nerve to call out federal troops teargassing protestors AS IF HE DIDN’T DO THE SAME THING IN FERGUSON & BALTIMORE LOL

— Patriot J 🔥 (@sirhottest) July 30, 2020

We can only imagine the response if Trump used a Republican’s funeral to propose GOP policies.

Watch:

In his eulogy for John Lewis, former Pres. Obama proposed a swath of voting rights expansions, including:

– Automatic registration
– Adding polling places
– Expanding early voting
– Making Election Day a holiday
– Eliminating the filibuster, if necessaryhttps://t.co/sVteeuYRLu pic.twitter.com/sbFTOt1ss6

— ABC News (@ABC) July 30, 2020

Authored by Bruce Wilds via Advancing Time blog,

The Federal CARES ACT passed in March protects renters living in properties with government-backed mortgages from eviction until July 25. While the intent of lawmakers might be to protect what they consider the most vulnerable in our society this sends a grave signal to landlords. Halting evictions cuts away at the very fabric of contracts to lease property and undermines the rights of owners. Ironically in the end this will most likely put more pressure on low-income tenants and result in higher rents.

In the same way, rent controls have proven detrimental to controlling housing markets governments efforts to protect renters from eviction may result in unintended consequences. What seems by many a noble pursuit will cause many landlords to exit the business or take rental units offline. The government’s action of halting evictions could be seen as an extension of current policies that sidestep dealing with the problem that society is creating a growing number of irresponsible tenants. The ugly fact is that government housing cherry-picks the best of the low-income renters providing them with very low rents and nice apartments. The rest they dump on the private sector.

Now that the eviction moratorium has expired, the covid pandemic predicts a wave of evictions is about to take place. The Urban Institute estimates the with the expiration of the eviction moratorium more than 12.3 million or 28 percent of America’s 43.8 million renters are at risk of losing their homes. Landlords that have had enough have begun an unsavory part of their job filing eviction paperwork for tenants who haven’t paid rent for 30 days or in many cases, months. This, of course, comes just as some 25 million Americans are about to lose the generous weekly $600 federal unemployment checks.

Unfortunately, the clowns in Washington are busy playing politics with this. In remarks outside of the White House on Wednesday, Trump and Treasury Secretary Mnuchin acknowledged that while the administration and Democrats remain far apart on any kind of deal. This resulted in them pushing for the extensions of both programs. Trump emphasized that halting evictions and keeping people in their homes has become a priority. A big part of the problem is that letting people remain in the property without paying rent does not stop the bills a landlord must pay from coming due. This rapidly makes being a landlord a money-losing proposition.

80% Of New Units Are High-End Luxury Units

This all adds to the feeling everything is a bit off. It seems reality is starting to hit home as soaring rental costs collide with the fact overall disposable incomes have rapidly eroded for the middle class. The main driver of soaring rents seem to be following new building costs, in particular, land, material, and hard costs mostly driven by labor make it harder to build new buildings at a reasonable cost. This has resulted in some investors moving away from new construction and into remodeling older units which also raises the rents on current tenants ever higher.

Ultimately higher costs for taxes, local fees, utilities, insurance, maintenance cost, general labor, and just about everything will be passed on to the renter. While the market has responded to rental housing needs for higher-income households, there are alarming trends that suggest a growing inability or desire to supply housing that is affordable for middle- and working-class renters this becomes very noticeable when we look at the population with very low incomes. Developers have displayed little interest in, or they simply can’t afford to add anything but luxury units.

There’s a huge unhealthy disparity in high-end rents versus low-end rents across the country and with building cost being similar between constructing high-end versus low-income units why would anyone want to deal with the low end of the market and all the trash that comes with it when you consider that;

• Our government has been busy encouraging people who have no business owning a house to buy one regardless if they have any idea of how to maintain  it. This government policy is to generate a slew of programs geared to assist first-time home-buyers and others with special incentives and aid. This often means anyone with any kind of credit and even getting all their income from government programs often move out of apartments to buy a house. This creates higher turnover rates and leaves the apartment manager forced to lease the unit to someone with even less income or no credit.

• Another part of our government’s housing policy funds and determines what is built, the problem is a massive amount of money is flowing into apartments that most people cannot afford. Low-interest rates coupled with speculators using “Wall Street” money are creatively financing these units out of thin air. From somebody that knows the industry, you can take it to the bank that it will not end well when these new units go online and are unable to meet income projections. A while back, an article in Business Insider warned the US apartment market has become overdeveloped, with supply outpacing demand, especially in the most expensive segment of the market but that has not slowed building.

• Building and providing housing to low-income people often proves to be a thankless job that nobody wants. This is beginning to put a great deal of pressure on the system as private sector landlords that do not partner with government programs suffer the abuse. Simply put, government housing policy has failed to address the housing needs of the growing group of dysfunctional individuals that are the bane of society. Few honest people desire to put up with the endless crap such a position constantly dishes out. Inventing market terms such as “sub-luxury segment” to describe basic housing only confuses the issues that need to be addressed.

Housing Policy Throws Older Units “Under The Bus”

The government holds huge responsibility for a rising share of our housing problems in low-income situations because its policies ignore the reality many tenants are simply irresponsible. The main reasons for most evictions center around people not following the rules, damaging an apartment, or not paying their rent. By making anyone with an eviction on their record “ineligible” for most housing programs the government shrewdly and cleverly has sidestepped having to deal with these people. Even with close to half (47%) of all renter households (21 million) pay more than 30 percent of their income for housing, including 11 million households paying more than 50 percent of their income for housing, it is not enough when we are talking about “low incomes” and the amount of damage and grief they dump upon their landlords.

The unintended consequences of government policy which sidesteps responsibility for America’s dysfunctional poor over time have added a great deal to our housing woes by driving up the cost of renting for everyone else. Many people do not realize that over the years government in many areas of the country have put massive disincentives in place for those interested in renting housing. Those include competing with them on many levels. Private landlords are forced to pay taxes that go to subsidize government-backed competitors that reject the least desirable tenants then ask the private sector to provide them with shelter. This allows government-backed projects to provide a better product at a lower price which often results in such projects being poorly run.

Bad Tenants Can Do A Lot Of Damage

By bending over backward in an attempt to “protect the consumer” the government and courts are creating an army of irresponsible people who go through life exploiting “the system.” We have even have gone to where tax money is being used to pay the legal fees of tenants wanting to fight the very landlords they have wronged. The government has even made it much harder to check the credit of someone wanting to rent claiming it is to protect the potential tenant’s privacy. This ignores the fact those renting an expensive piece of property are putting themselves at great financial risk.

Landlord claims are usually pursued and disputed in the small claims division of the court where getting an eviction or judgment against a bad tenant has become increasingly time-consuming and expensive. Adding to this ugly reality are limits that often allow only a fraction of a landlord’s loss to be covered, these can be as low as $1,500. It is not difficult for unpaid rents and damages to greatly exceed this amount. It must be noted that getting a judgment in your favor does not mean it will ever be paid and that these people continue to move from place to place causing havoc wherever they go.

Stories that delve into what is happening in our communities are important, I consider them as “micro-economic” images of what is occurring in many places across America. A show on Netflix titled “Renters” looks into the misadventures of property managers and their troublesome renters in New Zealand. It reveals similar housing problems exist in many countries. My attitude may be skewed by living in one of if not the lowest rent areas in America. A ZeroHedge article stated that “attractive rents” are a relative term as the monthly dues for a tiny studio apartment in NYC will still run you $2,681, or $64.92 per sq. ft. we’re pretty sure that implies the average studio is roughly 495 square feet…or about the size of the average living room in all those “fly-over states” that elitist New Yorkers love to look down upon. The fact is, rents in my area are often as little as $650 a month for a two-bedroom one-bath 950 sq. ft. apartment. This is far less for essentially the same product.

Footnote;  I may have understated how much regulations also add to higher rents. In some states, the government is even debating putting the burden and responsibility for keeping occupied units clean upon the landlord. Also, it is not possible to evict someone during the Christmas Holidays in my area for any reason, you can file but no action will be taken until after the holidays are over. One way to address or level the playing field would be to move away from public housing and give those needing housing aid “rent only vouchers” that could be used with any landlord rather than putting these people into a quasi-government ran project. More on the subject of evictions in the article here.

GMC is set to unveil the first-ever all-electric High Utility Maximum Mobility Easy Rider, otherwise known as Hummer, this fall. 

“The First-Ever GMC HUMMER EV has zero limits, and our open-air design provides powerful proof. For the unique open-air experience, easily remove the four roof panels and front T-bar to let the world in. We’ll continue to keep you informed as we prepare to show the world our revolutionary all-electric, zero emissions, zero limits super truck,” GMC’s website said. 

GMC makes some very impressive claims, first, it says the new electric Hummer will have 1,000 horsepower, able to rocket the vehicle from 0-60 mph in 3 seconds. Now, wow, that’s supercar fast, if true… 

A press release by GMC said the “all-electric super truck” would be unveiled to the public this fall and “will begin production in fall 2021.” 

“GMC announced today that its all-electric super truck will debut later this fall and will begin production in fall 2021. Details about the GMC HUMMER EV’s remarkable on- and off-road capabilities will be shared closer to its reveal,” the release said. 

Not much is known about the design, but here are some behind-the-scenes shots of what the unfinished all-electric Hummer looks like. 

A promotional video of the new electric vehicle was recently released. 

The electric Hummer appears to be faster in 0-60 mph takeoff than the Tesla Model 3 Performance. 

Authored by Charles Hugh Smith via OfTwoMinds blog,

No federal bailout or stimulus can reverse these three dynamics, and no amount of legerdemain can replace the spending of the top 10%.

Few of those anxiously seeking a rebound in consumer spending take into account the top 10% of households account for almost 50% of consumption, and that top 10% skews heavily to the older, wealthier top tier whose free-spending ways have been built on the enormous wealth effect as their stocks, bonds and real estate assets have soared in value over the past 12 years.

The top 10% has largely escaped the significant financial hits cutting a swath through the bottom 90%, but that’s about to change. Few of the top 10% have seen their pensions cut, their portfolios of stocks and bonds shredded, their home value in free-fall or their managerial / technocrat position eliminated. Most are watching the financial devastation from the security of owning 85% of the nation’s assets, and from positions in the protected-class with access to federal money, either directly or indirectly.

Three factors could materially suppress the future consumption of those responsible for 50% of all consumer spending.

1. Age-related caution about exposure to the virus. Not only are many of the top 10% older, many of these households are caring for parents in their 70s, 80s or 90s. Given the heightened risks for these demographics, is it really worth it to go into crowds for entertainment? The short answer is no. Furthermore, these older, wealthier households have been there and done that— foregoing cruises, air travel, fine dining, live music, etc. is not that much of a sacrifice, as they’ve enjoyed all these niceties for decades.

2. As corporate revenues and profits continue sliding, the managerial / tech class will start getting culled. All sorts of positions that looked “essential” before the pandemic are suddenly on the chopping block.

3. The wealth effect is about to reverse as the Everything Bubble finally pops. With the Nasdaq at record highs, bonds rising in value as yields plummet and the real estate market bubbling along on 3% mortgage rates, such a reversal is widely viewed as “impossible.” Of course it is–until it isn’t. All bubbles pop.

All the bright spots of consumption fueled by top 10% spending–rising sales of second homes, RVs, home remodeling, etc.–are based on the incomes and wealth of the top 10% never materially declining. But how realistic is it to reckon a rotten-to-the-core economy dominated by greedy monopolies and cartels and looted by financier skims that is finally in an inevitable free-fall would magically leave the top 10% untouched?

How realistic is it to reckon that the Everything Bubble would magically continue inflating forever when history is conclusive that all bubbles pop?

No federal bailout or stimulus can reverse these three dynamics, and no amount of legerdemain can replace the spending of the top 10%.

*  *  *

My recent books:

Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World ($13)

(Kindle $6.95, print $11.95) Read the first section for free (PDF).

Pathfinding our Destiny: Preventing the Final Fall of Our Democratic Republic ($6.95 (Kindle), $12 (print), $13.08 ( audiobook): Read the first section for free (PDF).

The Adventures of the Consulting Philosopher: The Disappearance of Drake $1.29 (Kindle), $8.95 (print); read the first chapters for free (PDF)

Money and Work Unchained $6.95 (Kindle), $15 (print) Read the first section for free (PDF).

*  *  *

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Just when we thought the woke PC madness of 2020 couldn’t get anymore absurd, a local incident out of Michigan is so astoundingly stupid that even the AP reported on it with a tone that aptly captures the inanity:

Owners of a Michigan bed and breakfast have removed a Norwegian flag outside of their business after being accused of promoting racism from people who think that it is a Confederate flag.

Kjersten and Greg Offenecker, owners of The Nordic Pineapple, hung the flag opposite of the American flag after they moved into the Civil War-era mansion in 2018, the Lansing State Journal reported. They took both flags down last week.

“This flag is so often mistaken for the Confederate flag and people are often offended by it before they realize that they are mistaken,” Kjersten Offenbecker, owner of The Nordic Pineapple bed and breakfast, wrote on Facebook last week. She said she was forced to “find a less conspicuous place” for the flag after what amounts to constant harassment over it.

The Nordic-themed business reported receiving “at least a dozen hateful emails,” and a constant barrage of verbal attacks for the Norwegian flag, which merely happens to be red, with a blue and white cross. It had long flown beside the American flag over the boutique hotel’s front steps.

“We love being members of the St. Johns community and are heartbroken to have had to make this decision,” Offenbecker said.

Perhaps she’s more heartbroken about how absolutely stupid people are? It appears so…

“It bugs me as far as the stupidity of people,” Greg Offenbecker remarked. “Even if the flag is blowing in the wind or laying limp, there are no stars on it. They look nothing alike.”

“I don’t see it because I grew up with the Norwegian Flag,” Kjersten Offenbecker said. “To me, they are two distinct flags.”

The AP reports the couple, obviously of Norwegian heritage, have two Black children which they previously adopted.

Yet the whole flag kerfuffle has resulted in repeat accusations that they are ‘racist’.

It’s 2020 and though many have high hopes of preserving the Republic, we’re more clearly fast descending into an Idiocracy.

Heading into the current, Q3 quarter – typically one of Apple’s slowest of the year – Wall Street was expecting Apple to report revenue of $52.2 billion, or another slight decline from last year, even though Apple didn’t provide guidance for the quarter and is unlikely to do so again until the coronavirus pandemic ends. Despite the slowdown, AAPL shares rallied a whopping 43% from April through June, Apple’s best quarterly performance in eight years (during what is typically its slowest quarter). As Bloomberg notes, analysts cited everything from the iPhone maker’s App Store revenue growth, the potential of its wearable products, stock buybacks and the potential of its services business as helping outweigh the impact of the coronavirus. The biggest driver of optimism is the release a 5G iPhone, expected later this year. At the same time, while looking at the current quarter, analysts were expecting a continuation of recent trends, including a sizable dip in iPhone sales, at revenue of over $21.3 billion, but a jump in services, with revenue of $13.12 billion.

So with that in mind, moments ago AAPL joined the rest of the megatech sector in reporting absolutely blockbuster results largely boosted by the record stimulus – in both the US and across the world – which included:

• Revenue growth of a huge 11%, amid expectations of a decline
• iPhone sales were up, on projections of a decline
• All other categories – Mac, iPad, Wearables, Services – grew

And while Apple didn’t give a forecast again, it did announce a 4 for 1 stock split, clearly anticipating further gains.

Here are the Q3 details:

• Revenue of $59.7 billion, smashing estimates of  $52.3 billion
• EPS of $2.58, also shaprly above the estimate of $2.07
• iPhone revenue grew 1.7% to $26.4 billion.
• Services grew 15% to $13.2 billion.
• Mac sales were up 21% at $7 billion.
• iPad revenue grew 31% to $6.6 billion
• Wearables, home and accessories jumped 17% to $6.5 billion, est $6.09

Did Americans use their stimulus checks to buy iPhones and Apple watches? It sure seems that way. Only it wasn’t just America: Apple sales were up in every region with the Americas contributing the most.

For the first time in two years, sales rose Y/Y across all regions:

And while this was supposed to be a slow quarter for AAPL, it was anything but:

Just as remarkable is that contrary to expectations of a decline in unit sales, everything from iPhones, to iPads to Macs saw higher revenues Y/Y, as locked down consumers snapped up new iPhones, iPads and Mac computers to stay connected during the pandemic.

There were a few blemishes, including a rare sequential decline in Service revenue, which dipped to $13.156BN from $13.348BN last quarter.

Services dipped from a record 22.9% of total revenue last quarter to 22.0%, still up from 21.3% a year ago:

Discussing the quarter, CEO Tim Cook said:

It was broad-based quarter in terms of our growth. iPhone did better than what we had expected. We saw a slow first three weeks of April where the Covid-19 impact was particularly bad. And then when the lockdowns and point of sales began to come back some, we saw a marked improvement in May and June, more than we had estimated.”

A few more bullet points from the Bloomberg TV interview:

• Pandemic “likely” helped results for Mac and iPad due to work from home and remote learning
• “Digital services had a really strong performance with record revenues on the App Store, Apple Music, Video, and Cloud Services.”
• “Advertising and AppleCare were impacted by reduced economic activity and the store closures”
• iPhone and wearables “likely” were hurt due to the store closures.
• Store closures “weigh” on results and he expects it to continue to.
• “We’re not giving guidance because of the uncertainty.”

And some details on the stock split:

“Each Apple shareholder of record at the close of business on August 24, 2020 will receive three additional shares for every share held on the record date, and trading will begin on a split-adjusted basis on August 31, 2020.”

One thing that won’t get prominent notice is Apple’s net cash (excluding total debt), which after hitting a record of $163BN in Dec 2017 has shrunk in half to $81BN, the lowest level in 9 years.

Joining most other tech companies, Apple said that its U.S. employees won’t return to the office until early 2021; earlier in the week Google said that its employees will stay home until next July.

In any case, looking at the market verdict, investors are clearly delighted and just like the other gigatech companies, Apple stock is soaring, and after exploding above $400, has taken out its previous all time high.