Wall Street traders have coined a new acronym for President Trump’s habitual tariff U-turns: TACO—Trump Always Chickens Out. The tag went viral this week when Trump, visibly irked, was asked about it during an Oval Office event.
🌮 TACO trade delights markets Over recent months, equity and bond markets have been on a wild ride, reacting to Trump’s tariff threats with knee-jerk sell-offs—only to rally when he relents. That pattern prompted Financial Times commentator Robert Armstrong to dub it the “TACO trade.” Investors now buy the dip, confident that Trump will soften his stance.
🗣️ “You call that chickening out?” When a reporter mentioned TACO, Trump bristled:
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“I chicken out? Oh, I’ve never heard that. You mean because I reduced China from 145% that I set down to 100 and then to another number?”
He defended his moves as savvy negotiation—setting a “ridiculously high number” to extract concessions.
🇪🇺 EU tariff tango Last week, Trump threatened 50% tariffs on all EU imports from 1 June. Stocks tumbled. Two days later, he postponed the plan to 9 July after phone calls with EU leaders:
“Please, let’s meet right now,” he said EU counterparts pleaded. When markets reopened post-Memorial Day, the S&P 500 closed strongly in the green, underlining the TACO trade’s power.
🇨🇳 China rate rollercoaster Trump raised Chinese tariffs to as much as 145%, then slashed them to 30%. His April threats of “reciprocal” tariffs on dozens of nations also fizzled: he paused them within hours, citing markets being “yippy yappy.” Before the pause, the S&P 500 flirted with bear-market territory; after, it logged its best day since October 2008.
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🚨 Trump’s meltdown At Wednesday’s event, Trump snapped at the reporter:
“Don’t ever say what you said—it’s the nastiest question.”
🚨 “Don’t ever say what you said!”
Holy shit. Trump just learned Wall Street is calling his tariffs “TACO trade” (“Trump Always Chickens Out”) — and you have to watch his meltdown. pic.twitter.com/fQUIoWqiJN
His ire shows that even the most seasoned deal-maker can’t stomach being characterised as a flip-flopper. Meanwhile, traders keep shopping the TACO dip with relish.
