Beware the Tax Holiday Hangover

  • Zoom Surges 40% on Q2 Earnings
  • Health Experts: “I Dunno. Open a Window Maybe?”
  • Beware the Tax Holiday Hangover
  • An Inflationary Storm Is Brewing


Zoom Surges 40% on Q2 Earnings

Shares of Zoom Video Communications (ZM) surged 40% after the company reported that the End of the World as We Know It brought a significant boost to second-quarter revenue.

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Say what you will about the fall of civilization but second-quarter revenue has been most triumphant.

When the human race was wiped out and replaced by a race of identical-looking mole people (us), the world became dependent on video conferencing technology for work, school, and socializing.

No one stood to benefit more from this terribly inconvenient catastrophe than Zoom, who offered free video calls with up to 100 attendees and was already installed on our laptops because of work anyway.

Zoom says it averaged 148.4 million monthly active users in Q2, up 4,700% year over year.

Most of that growth came from free users trying to stave off the specter of existential dread with online happy hours and zoom dating.

That said, revenue from paid users exploded by 355%. The company’s income came close to $186 million, up from just $5.5 million from the same period last year when we still had hopes and dreams and stuff.

Zoom, who has been having a rather lovely apocalypse all things considered, says 81% of that growth came from new customer subscriptions. And according to Chief Financial Officer Kelly Steckelberg, there’s been less churn than expected. (Which may have something to do with a pandemic that’s still very much in full swing.)

On the back of one of the worst times I’ve personally ever had, the company’s shares (ZM) are up 548% year to date, compared to a less than 9% gain from the broader S&P 500.


Health Experts: “I Dunno. Open a Window Maybe?”

Health experts now believe that opening windows and running the AC all day may reduce the risk of catching COVID indoors.

Some good old-fashioned airflow has joined the growing list of tools in our arsenal against the coronavirus. Health scientists and mechanical engineers are now issuing guidelines for fans, filters, equipment, and leaving your window open like you’re one of those kids in Hook.

woman in room image

Leaving your window open may reduce the risk of COVID, but you need to be vigilant for Peter Pans.

Driving the nationwide push to get a nice breeze going is the mounting evidence that coronavirus is transmitted through prolonged exposure to the pathogen in the air.

“We didn’t focus on it enough initially,” Dr. Abraar Karan, of Harvard’s Brigham and Women’s Hospital in Boston, told the Wall Street Journal. “We told everyone to stay home. We weren’t thinking about people congregating in public spaces.”

Exactly how the virus is transmitted by air has yet to be established. But researchers say the evidence suggests a flow of clean air indoors can reduce the risk of COVID (and smells).

Aerosol scientists (which is what teens who huff paint call themselves) and building engineers recommend a combination of opening windows and doors, installing window fans, using portable air purifiers, and upgrading heating, ventilation, and AC systems.

Some businesses, including theatres and gyms, have begun taking these steps. But our busted-ass schools are an entirely different story.

According to a report published by a federal watchdog in June, about 36,000 schools need to update or replace their HVAC systems. Replacing these systems can be expensive — as much as $5 million for Denver public schools alone. And because the government hates spending money on kids cause they don’t vote, many schools will likely go without.


Beware the Tax Holiday Hangover

President Trump’s four-month tax holiday begins today and most folks have no idea what’s going on.

I mean, most folks generally have no idea what’s going on. But in this case, it could end up screwing up their 2021 finances before the year even starts.

With negotiations over the next coronavirus relief package going nowhere fast, President Trump signed an executive order to defer employees 6.2% Social Security tax until December 31.

What many folks don’t realize is this is only a temporary deferral and you’re going to have to pay all that money back eventually. And by eventually, I mean before April 30 next year.

Failure to pay will be met with penalties, interest, additional taxes, and the usual slew of crap that comes with duckin’ taxes.

“This is a holiday in which the work continues to pile up on your desk when you’re gone, and you take care of it when you come back,” Robert Delgado, principal at the KPMG accounting firm, told CNBC.

“I’d say employees have to clearly understand this isn’t forgiveness, it’s deferral.”

Employees who take part in the tax holiday should expect to see smaller paychecks in January when you have to start paying them back. Today marks the first day of the tax holiday, which ends on Dec. 31 when Taxta Clause climbs down your chimney and leaves you a fat bill to pay.

In Other News

In Other Words


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An Inflationary Storm Is Brewinge

By Money & Crisis Editor Graham Summers

The Fed has finally made up its mind… it wants inflation.

Ever since the great financial crisis of 2008, the big question has been: What will the ultimate outcome be from all this money printing and Fed interventionism? Will it be another deflationary collapse — or an inflationary storm?

Some 12 years later… we finally have our answer… it will be an inflationary storm.

Last week, the Fed announced that:

  1. It is changing its inflationary target from 2% to an average of 2% (meaning inflation could overshoot to the upside).
  2. It was comfortable with inflation going as high as 3% as long as it does so at a manageable rate.

Remember, this is the Fed we are talking about, not some gold bug. So, the mere fact that the Fed is even suggesting that it is OK with higher rates of inflation has systemic implications.

The Fed has long averred that inflation was nowhere to be found, but that it if ever did show up, they could easily contain it, and so none of us needs to worry about inflation ever getting out of control.

The fact, then, that the Fed is suddenly OK with inflation running hot is akin to a structural engineer saying, “I’m fine with this massive dam leaking, possibly even a lot… provided the leaks occur in a way that is manageable.”

You get where I’m going with this.

And so do the markets.

Take a look at Lumber.


How about Copper?


And then there’s gold and silver… which have already begun their next legs up.

gold and silver

This is the BIG theme for the markets going forward.

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Closing Data for Today

S&P Index 5003,524.120.72%
  • Job growth will slow sharply over the next decade, says Labor Department.
  • McDonald’s sued by several dozen former franchisees, alleging it unfairly treated Black owners.
  • New York City will delay in-person lessons after teachers union threatens strike over coronavirus safety concerns.


Shane Ormond
Editor, One Last Thing

Shane Ormond

Written By Shane Ormond

Shane Ormond is the managing editor for One Last Thing. In a previous life, he wrote and edited copy for International Living in Waterford, Ireland.