The TACO trade is the new Trump trade
a year ago
- #Tariffs
- #Stock Market
- #Wall Street
- A new acronym 'TACO' (Trump Always Chickens Out) is trending on Wall Street, referring to market bets on Trump reversing tariff policies.
- The TACO trade suggests buying stocks when Trump announces tariffs, anticipating a market rebound when he retreats.
- Examples include market dips and recoveries following tariff announcements and subsequent delays in April, May, and June 2024.
- Trump dismissed the TACO moniker as 'nasty' and defended his tariff strategy as necessary for negotiations.
- The TACO trade has become a guiding principle for investors, though its effectiveness may wane if trade deals aren't finalized.
- Analysts warn that prolonged tariff delays without resolutions could lead to a US economic downturn.