The TACO codename used by Wall Street traders to describe President Donald Trump is more likely to make him stick with his international tariffs “just to prove a point.”
The nickname— short for “Trump Always Chickens OUT” — came about because of the president’s habit of making tariff threats, resulting in a drop in the markets, only for him to walk the threat back and see the markets rebound.
“We think that, unfortunately, as the so-called TACO trade becomes more viral, it becomes more likely that Trump will stick to higher tariffs just to prove a point,” Joachim Klement of investment bank Panmure Liberum told Reuters.
The acronym was coined by Financial Times columnist Robert Armstrong writing about Trump’s so-called “Liberation Day” in April, which caused the markets to hit historic lows before he ordered a 90-day pause one week later. It led to record highs.
“The US administration does not have a very high tolerance for market and economic pressure, and will be quick to back off when tariffs cause pain,” Armstrong said. “This is the TACO theory: Trump Always Chickens Out.”
It did not go down well with Trump, who responded with fury when asked about the acronym last week. “That’s a nasty question,” he said. “To me, that’s the nastiest question.”
“You call that chickening out? It’s called negotiation,” Trump said, visibly irked.
Since the nickname took off online, people shared AI-generated memes of the president in a chicken suit.
The president was caught off guard and was unaware of the term, according to CNN. “He thought the reporter was calling him a chicken,” a White House official told the outlet. Trump was reportedly irritated that his team did not tell him about the phrase as it gained traction in financial circles and the media.
“It clearly bothered him, primarily because it demonstrated a lack of understanding about how he actually utilizes those threats for leverage,” a person familiar with the matter told CNN. “But obviously he’s not a guy who looks kindly on weakness, so the idea anyone would think that with respect to his actions isn’t received well.”
The frustration follows the Court of International Trade’s ruling that the Trump administration must dismantle the “reciprocal” tariff policy. The federal court ruled he lacked the authority to create it, which the White House immediately appealed.
The administration won a reprieve, which means the tariffs will be reinstated while the case makes its way through the courts, but uncertainty looms over the economy.
