Over the last few weeks, the above statement has been appearing on financial channels, in newsletters, and on many trading desks. That runs counter to everything taught in business schools and the financial world at large. Has the stock market truly become a trillion-dollar casino, or is there something else going on?

 

As readers are aware, the Trump administration has pushed back the implementation date of reciprocal tariffs until Aug. 1. In the meantime, the White House is sending a flurry of form letters to various countries, listing what will happen if they do not make a deal with the U.S. before that date.

 

A new risk on the tariff front is that Donald Trump showed his willingness to step beyond the economic frontier in his tariff war. Unlike many countries, Brazil has a trade deficit with the U.S. That means Brazilians buy more from us than we buy from them.

 

This time, he is using tariffs to insert himself into a country's domestic political affairs. He threatens to slap a 50 percent tariff on Brazil unless Brazilian authorities drop charges against former President Jair Bolsonaro, a right-wing populist leader. Bolsonaro is accused of attempting an alleged coup and trying to poison the sitting president, Lula da Silva.

 

How does this square with his speech to the Arab Islamic American Summit in May, in which he said:

 

"America is a sovereign nation, and our first priority is always the safety and security of our citizens. We are not here to lecture — we are not here to tell other people how to live, what to do, who to be, or how to worship. Instead, we are here to offer partnership — based on shared interests and values — to pursue a better future for us all."

 

The markets are divided on whether this upsurge in tariff rhetoric is just another TACO trade, an escalation, or whether the president will finally put our money where his mouth is. In the meantime, we are getting the usual "a deal any day now" promises from his staff. Judging from this week's market reactions, Donald is the "boy who cried wolf" too often, but there may be something else afoot that explains the market's resilience.

 

 The answer lies in the flow of funds that propel markets in one direction or another, depending on a variety of variables. Readers need to understand that professionals and institutions place their bets on which way the markets are going, like the rest of us, but they also hedge those bets. For professionals, volatility (often a polite term for downside risk) is an extremely important concept that, if not properly hedged, could result in significant portfolio losses and possibly jeopardize your job.

 

Over the decades, an entire industry of funds, known as Volatility Control Funds (VCF), has emerged around the concept of volatility. It is a strategy designed to go long or short based on volatility levels often embedded in portfolios, protecting them from extreme market fluctuations. Class over.

 

For the last few months, the imposition of tariffs has been high on the markets' list of potential volatility events. Witness the stock markets' reaction to President Trump's April 2 announcement of reciprocal tariffs. The "Trump dump" took four days, and the S&P 500 Index fell about 12 percent while the Dow dropped 11 percent. On April 9, Trump announced a 90-day pause, and markets recovered.

 

Since then, VCF funds have been hedging the potential downside to their portfolios by shorting markets to the tune of billions of dollars, ahead of the new July 9 deadline. The higher the markets climbed, the more money was invested in protecting those gains. Last week, President Trump postponed again, this time to August 1.

 

As a result, VCFs must extend their tariff playbook to August. In the meantime, they need to buy back the millions of stocks they shorted over the last 90 days and bring their equity positioning back to neutral. Estimates are that we were looking at $45 billion or more in mechanical demand for equities. This flow of funds is happening regardless of the present valuation of the stock market. It doesn't happen all at once, but at worst, it has kept a floor under stocks this week.

 

In the meantime, we have some important data scheduled for next week. The Consumer Price Index for June is scheduled for release on Tuesday. It will mark a turn in the recent downward trend of the inflation rate. That should come as no surprise to you since I have been warning readers of this turn of events for months.

 

Wall Street analysts have finally twigged to the possibility that the CPI will be higher than expected. Many economists have rushed to ratchet up their expectations for a higher CPI over the last week or two. Many now have higher numbers than my own. In any case, that event poses some risk to the market. It should push bond yields higher along with the dollar.

 

The cryptocurrency markets had a good week. Bitcoin followed the stock market and made a new high at $118,000. Ethereum is also on a tear, as is Solano. I see Bitcoin trading at $145,000 this year. Gold is still trading within a range, but I remain bullish on the precious metals as long as stagflation remains the name of the economic game.

 

 The markets overall have hung in there. The selling pressure in the first half of the week that I had expected was more than matched by the buying demand from the VCTs. As for other potential market movers, I do not expect an interest rate cut by the Fed when they meet at the end of July, so that leaves the inflation data next week, as well as Donald Trump and his tariff threats. My CPI number is plus-2.5 percent while the Street is now at plus-2.6 percent. A hot number could hurt stocks for sure and, if so, send markets down a percent or two.

 

As for President Trump, he remains a wild card. One of the best trading strategies this year has been to buy stocks when they fall because of his tariff threats. Every day this week, he threatened one country or another with higher tariffs. The latest was Canada. He also said he will levy a 50 percent tariff on foreign copper imports. The point is that since markets are at an all-time high, he feels he has room to rattle his tariff stick at the world.

 

As I have advised readers many times over, ignore the noise coming out of Washington. Instead, focus on stocks and sectors that will do well in a stagflation environment domestically, and move more money into overseas markets.

 

Anyone seeking individualized investment advice should contact a qualified investment adviser. None of the information presented in this article is intended to be and should not be construed as an endorsement of OPI, Inc. or a solicitation to become a client of OPI. The reader should not assume that any strategies or specific investments discussed are employed, bought, sold, or held by OPI. Investments in securities are not insured, protected, or guaranteed and may result in loss of income and/or principal. This communication may include opinions and forward-looking statements, and we can give no assurance that such beliefs and expectations will prove to be correct. Investments in securities are not insured, protected, or guaranteed and may result in loss of income and/or principal. This communication may include opinions and forward-looking statements, and we can give no assurance that such beliefs and expectations will prove to be correct.

Older populations worldwide are experiencing a significant increase in skin cancer cases after years of cumulative sun exposure over multiple decades. In the U.S., invasive melanoma rates continue to rise sharply among those older than 60, especially among whites.

 

The American Cancer Society estimates that approximately 104,960 new cases of melanoma will be diagnosed by dermatologists this year. Is it any wonder that health experts predict the dermatology sector of healthcare will reach $3.59 billion over the next 10 years? Last week, I examined some of the reasons why skin care has been the overlooked stepchild of health care for an entire generation.

 

It was almost as if the Baby Boomer generation was bound and determined to do as much damage as they could to this vital part of their anatomy. I explained how the Sixties generation became sun worshipers searching for the perfect Beach Boys tan at a time when industry was decimating the ozone layer with chlorofluorocarbons.

 

As Baby Boomers stripped down and the ozone layer began to disappear, we found even better, faster ways to damage our skin than simply frying our baby oil-soaked skin in the sun for hours. The explosion of cheap package holidays and tours to exotic locations (noted for their tropical sun) made for a great tan that would be the envy of the neighborhood.

 

Tanning beds were introduced to North America in 1978 and gained popularity by the mid-1980s. At its peak, the industry was generating $2 billion annually; however, as the health risks of exposure to UV became apparent, revenue plateaued, remaining around $1.9 billion per year.

 

The dermatology industry argues that the use of these beds significantly increases the risk of developing skin cancer. In one study alone, 61 of 63 women were diagnosed with melanoma, the deadliest form of skin cancer, before 30 who used tanning beds. These beds can also compromise your immune system, cause clinical eye issues, and lead to photodamage, as well as accelerate photoaging or premature skin aging.

 

The facts are that as we age, the incidence of certain skin disorders increases, as exposure to the sun over a lifetime creates cumulative damage. That is another explanation for why my parents did not have my skin problems. Baby Boomers are living longer than previous generations, thanks to advancements in medicine and technology.

 

In my case, one or both of my parents may have had skin issues, but neither ever bothered to see a dermatologist. I know of several men in my generation or younger who have never had their skin checked out for skin cancer. To me, that is astounding since the median age of onset for melanoma is 55, with the highest incidence rates found in the 65-plus demographic. What's worse, people with paler skin are 20 times more likely to develop skin cancer than those with darker skin.

 

I also wondered if, as a teenager, exposure to the sun while in Vietnam for almost two years may have damaged my skin. No one wore sunscreen, nor was it issued to the troops. Would a similar exposure by U.S. service members in the Middle East also be a factor?

 

I know my father, who served in the 101st Airborne, only served in Europe during World War II, but what about the Marines in the Asian theater?

 

Interestingly, a large proportion of World War II patients with skin cancer were stationed in the Pacific. The Veterans Administration concluded that a few months to a few years of prolonged sun exposure in a high-intensity area may result in skin cancer many years after exposure. Similar findings by the Journal of the American Academy of Dermatology in 2018 indicated the same high risks applied to service members and veterans.

 

You would think that with all the new medical research on the causes and consequences of skin cancer, the younger generations of Americans would learn from our many mistakes. We never heard about SPF labels back in the day, but we do now. Not so. The American Academy of Dermatology found that Millennials and Gen Z, while more attentive to their overall health, tend to prioritize sun protection less.

 

In a recent survey, 70 percent of respondents did not understand the skin cancer risks associated with sunburns, and nearly 60 percent believe in sun tanning myths. The younger generations believed that base tans were healthy and said they would rather tan and look great, even if that meant they wouldn't look good later. They also believed that tanning beds are safer than sun exposure.

 

Some say skin cancer is part and parcel of our culture now. The phrase "Beauty is only skin deep" was first stated by Sir Thomas Overbury in his poem "A Wife," written in 1613. Tell that to the marketing world today, who argue the opposite. As such, most Americans grew up believing that the better you look, the more successful, happy, wealthy, and so on, you are. 

 

That has spawned an insatiable demand for aesthetic appearance. Aging Baby Boomers want to turn back the clock. Younger generations view skin as simply another cosmetic to alter or do with as they please. Technological advancements promise a wide range of innovations. Bikinis have gotten smaller. Tans are still "in" unless, of course, you are like me and have had several bouts of biopsies, laser treatments, surgery, and more. As any parent of a teenager will tell you, trying to get people to cover up who don't want to is pointless. No wonder dermatology is a growth business with no end in sight.

 

Bill Schmick is the founding partner of Onota Partners, Inc., in the Berkshires. His forecasts and opinions are purely his own and do not necessarily represent the views of Onota Partners Inc. (OPI). None of his commentary is or should be considered investment advice. Direct your inquiries to Bill at 1-413-347-2401 or email him at bill@schmicksretiredinvestor.com.

Congress passed the tax and spending bill, and the president signed it into law on July 4 but traders have already moved on. They are laser-focused on the July 9 tariff deadline. It doesn't look good.

 

As the holiday weekend begins, President Trump warned the nation that he will be sending letters to 10 or 12 countries starting Friday to notify them of the tariff rates they will face as of August 1. He claimed that by July 9, all nations "will be fully covered. They'll range in value from maybe 60 percent or 70 percent tariffs to 10 percent and 20 percent tariffs."

 

Equity futures, which are open on the July 4 holiday for a half-day, indicate that the indexes were down a little over half a percent on the news after gaining a little more than that by Thursday's close. While these letters appear to be an escalation in Trump's trade war, he has also postponed the deadline for tariff implementation once again, until Aug. 1.

 

Given his track record, most traders are looking to the crypto-based prediction market, Poylmarket, to gauge the chances he will follow through. As of Friday, the odds that Trump will remove most of the reciprocal tariffs before the deadline are 56 percent. Look out below, if that doesn't occur. Of course, in the event of a significant sell-off in the stock or bond market, I expect Trump and his billionaire crew to rapidly change their tune on tariffs as they have done in the past.

 

A deal with Vietnam was announced on Wednesday, marking the second such agreement to date. Imported goods from that country will face a 20 percent tariff, while transshipped goods, those shipped from Vietnam, but originating in another country (like China), will face a 40 percent tariff. U.S. exports to Vietnam would not face a tariff. That is good news, but small potatoes (U.S. exports total $13 billion) compared to what we export to other countries in the European Union ($592 billion) or Japan ($79 billion). The president has already said he doubts a deal with Japan is forthcoming.

 

Regarding the passage of Trump's spending bill, aside from the fact (denied by its legislators) that this so-called "beautiful" bill will increase the U.S. debt load by $3 trillion to $5 trillion over time, it will once again be an exercise in redistributing wealth from the poor to the wealthy. Remember, taxes under this bill will remain the same. They just won't go back up because the bill extends the status quo. There are a few minor exceptions, such as no taxes on tips or overtime for some Americans, and seniors receive a break through tax credits.

 

More than two-thirds of the total tax cuts will continue to benefit those with annual incomes above $217,000. Those making $1.1 million or more will garner one-fourth of the tax benefits. However, the real issue for GOP politicians is the spending cuts. The deep cuts in Medicaid and SNAP programs disproportionally impact working-class voters (defined as those without a college degree). 

 

Those are the voters who put both Donald Trump and a slim majority of Republicans in Congress in power. That is the main reason, aside from the cost of the bill, that the GOP, despite their majority in both houses, have struggled to pass this bill.

 

In 2023, Republicans represented 56 of the 100 lowest-income districts in the House. Republicans are counting on Trump's ability to sway the public to disregard the fine print in the bill. We all know why. Republican politicians worry how 20 million or more Americans, who face a deep decline in their social safety-net programs, will feel about their elected representatives come election time. To avoid that, Republicans deferred their most painful spending cuts until after the midterm elections.

 

In the meantime, the pressure on Fed Chairman Jerome Powell to cut interest rates continues unabated. The spate of weaker inflation data, combined with a recent weakening in economic growth, has prompted more players to follow the president's lead in calling for cuts as early as July. The June labor report punctured that narrative. The non-farm payrolls report was an upside surprise, as the U.S. economy added 147,000 jobs, exceeding the 106,000 that economists had expected. That pushed the headline unemployment rate down to 4.1 percent. It suggests that there is no need for a rate cut at this time.

 

My higher-end target on the S&P 500 Index was exceeded this week. As readers are aware, I have been anticipating a bout of profit-taking in July. Next week, we could see a pullback based on Trump's latest tariff threats. A 2-3 percent sell-off in the averages is possible, which may be a chance for the markets to refuel from overbought levels.

 

And yet, I see no real signs that the bulls want to relinquish their hold on the markets. Seasonally, July is a good month for markets, with an average gain of around 2 percent. In addition, the AAII investor sentiment survey is not nearly as euphoric as it should be, given a 28 percent gain in the stock market from its lows.

 

While there is no sure way to predict an interest rate cut in July or another extension of tariff delays after Aug. 1, either occurrence would send markets higher, possibly into what is called a "blow-off top." If so, this could catapult the S&P to 6,350-6,500 in a relatively short time. As such, over the next two weeks, anything could happen so strap in!

 

Bill Schmick is the founding partner of Onota Partners, Inc., in the Berkshires. His forecasts and opinions are purely his own and do not necessarily represent the views of Onota Partners Inc. (OPI). None of his commentary is or should be considered investment advice. Direct your inquiries to Bill at 1-413-347-2401 or email him at bill@schmicksretiredinvestor.com.

The dermatology sector in health care is expected to grow by almost 7 percent per year between now and 2034. That is good news, but the increasing incidences and prevalence of skin disorders are behind the industry's torrid growth rate.

 

The global market was estimated to top $1.4 billion last year, with North America being the fastest-growing market, followed by the Asia-Pacific. Skin cancer, warts, infections, dermatitis, psoriasis, and acne are among the primary disorders treated using a variety of therapeutic strategies, including cryosurgery, laser therapy, photodynamic therapy, radiation, and vitiligo therapies.

 

Over the past decade, like many other health-care areas, acquisition and investment activity in dermatology has skyrocketed, fueled by private equity, family offices, and institutional investors.

 

I am practically an expert in the area, given the number of times I have been scraped, cut, fried, and zapped over the last several years. As I wait for yet another biopsy on two spots, one on the crown of my head and the other on my forehead, I wonder how come I have all these unrelenting skin treatments when my parents had none, so I did a little research on the subject.

 

Each year in the U.S., an estimated 6.1 million people are treated for skin cancer, and that number is growing. With names such as basal cell carcinoma and squamous cell carcinoma, the most common forms are usually treatable. Most of these maladies are caused by overexposure to ultraviolet radiation from the sun and indoor tanning devices.

 

We know that the thinning of the ozone layer, where 90 percent of the earth's ozone sits between six and 31 miles above the surface, is partially responsible. This allows harmful ultraviolet rays (UVA) to penetrate the earth's surface and damage the middle layer of our skin. Unfortunately, it was only in the late 1970s that people realized that man-made chemicals, specifically chlorofluorocarbons, were destroying the ozone.

 

As a Baby Boomer, I recall the 1950s at Barnegat Bay on the Jersey Shore with my family. That's when suntan lotion became "a thing." We kids had to slop Coppertone on, although my parents rarely used it. It did little good anyway since I still managed to get a glowing red sunburn that ended in my peeling away large sections of white dead skin weeks later.

 

Reflecting on the past, I realized that basting in the sun only gained popularity in the late 1950s, at least in this country. It was then that the modern bikini became the rage for American women, shortly after Brigitte Bardot modeled a floral version on the beach at the Cannes Film Festival in 1953.

 

Before that, having a summer tan was the mark of a lower-class individual or an outside day laborer, while pale skin signified anything but. Having a tan became high on everyone's agenda. A tan was healthy, sexy and signified someone on the move.

 

I also recall that every male in America wore a hat of some kind while I was in grammar school. It was only after John F. Kennedy first appeared bareheaded at his 1961 inauguration that wardrobes began to change. He is credited with the death of the men's hat as males of all ages gladly exposed their scalps to the rays of the sun in perpetuity.  

 

The point is that, in general, people wore far more clothes back then than we do both summer and winter. Next week, I will expand on this combination of culture, science and events that conspired to create today's epidemic of skin cancer.

 

Bill Schmick is the founding partner of Onota Partners, Inc., in the Berkshires. His forecasts and opinions are purely his own and do not necessarily represent the views of Onota Partners Inc. (OPI). None of his commentary is or should be considered investment advice. Direct your inquiries to Bill at 1-413-347-2401 or email him at bill@schmicksretiredinvestor.com.

Mission accomplished. After a tumultuous six months in 2025, equities managed to overcome every obstacle and closed in on new highs. What does that mean for the second half of the year?

 

The short answer is nothing. We start again. Investors need to take each day as it comes. It is a world where governments have more weight and influence in determining the outcomes of both the economy and the markets than ever before.

 

I hope you read last week's column, "Regional Conflicts Present Buying Opportunities." I reminded investors that recent skirmishes, such as the one between Iran and Israel, usually do not last long and have little bearing on markets three to six months out. This week's cease-fire between the two adversaries is a case in point and is partially responsible for the breakout to new highs we are enjoying today.

 

Kudos to Donald Trump for engineering the circumstances that one can hope will make the Middle East a safer place in the future. And lest you think the president headed off to play golf, think again. He is now brow-beating the Senate to pass his Big Beautiful Bill (BBB) before the Senate's self-imposed deadline of July 4. He has already told legislatures that there will be no vacation days for them until this bill passes.

 

A lot is riding on that bill passing. I believe the market has already discounted its passage, so any hiccups or delays could spark a rush toward the existence. The most significant concern among the dissenting Republican politicians is not the spending part of the bill. Like most politicians, they talk a good show on the need to rein in spending but never do. It is that the cuts in Medicaid and other social programs may hurt some politicians' chances in the next election.

 

As investors await an outcome on that front, the president's feud with Fed Chairman Jerome Powell is intensifying. Readers may recall that Trump appointed Powell to lead the Fed back in 2018. Powell's term does not run out until June 2026. But it appears the president doesn't want to wait that long. This week, he floated the idea that he will name his pick to succeed Powell much earlier than is customary, possibly as early as September or October. Interestingly, several members of the Fed are already auditioning for the job by mimicking Trump's demand that the Fed cut interest rates as early as July.

 

Former Fed Governor Kevin Walsh, National Economic Council Director Kevon Hassett, Treasury Secretary Scott Bessent, Fed Governor Christopher Waller, and former World Bank President David Malpass are reportedly on Trump's shortlist. The thinking is that by naming a successor early, the president would undercut Powell's authority for the remainder of his term.

 

The odds of two rate cuts this year are rising, and stocks are climbing in anticipation that this additional pressure will force Powell to reconsider and reduce interest rates.

 

My two cents is that Powell is correct about waiting. As readers are aware, I expect inflation to rise through the end of the year, possibly reaching 2.9-3 percent by December. The Fed's preferred inflation indicator for May, the Personal Consumption Expenditures (PCE) price index, released on Friday, showed an increase, which was in line with my expectations but higher than the Street's forecasts. At best, we need to wait until we know whether or not Trump will do another TACO (Trump Always Chickens Out) on tariffs in July.

 

All indications are that he will once again postpone. China and the U.S. say they are working toward an agreement on tariffs, and Commerce Secretary Howard Lutnick promises that tariff agreements with 10 nations are "imminent." Treasury Secretary Scott Bessent chimed in by predicting that the U.S. could complete the balance of its most important trade talks by Labor Day.

 

Last week, I worried that the war in the Middle East would screw up my bullish forecast: "That leaves the market's range bound and probably short circuits my hope that we could reach 6,100-6,250 on the S&P 500 anytime soon. Now, don't take that as gospel because events could turn on a dime, propelling stocks higher." That is precisely what occurred.

 

We are within striking distance of 6,250, the high end of my target range. Next week is the end of the second quarter and depending on the headlines on tariffs, the BBB, etc., we could see a blow-off top in the markets.  After that, I am looking for some profit-taking in July and possibly August.

 

Bill Schmick is the founding partner of Onota Partners, Inc., in the Berkshires. His forecasts and opinions are purely his own and do not necessarily represent the views of Onota Partners Inc. (OPI). None of his commentary is or should be considered investment advice. Direct your inquiries to Bill at 1-413-347-2401 or email him at bill@schmicksretiredinvestor.com.