Trump's Tariff Threats: "TACO Trade" Sends Stock Markets on Rollercoaster Ride

Trump's Tariff Threats and the 'TACO Trade': Market Volatility and Political Fallout On May 29, 2025, Reuters released a short video explaining the term "TACO trade" and its connection to President Trump's trade policies. The term, coined by a Financial Times columnist, refers to Trump's unpredictable tariff threats and their effect on the stock market. Ramzan Karmali, in the Reuters video, explains, "TACO stands for Trump Always Chickens Out." This highlights Trump's tendency to announce tariffs and then later delay or withdraw them. Karmali cites the example of Trump announcing new tariffs on the European Union, only to delay them two days later. This caused a significant market reaction as stocks rallied upon the reversal of the tariff threat. Similar reactions were observed when Trump changed trade policies with China, Canada, and Mexico. The video concludes by noting President Trump's dismissive reaction to a question about "TACO trade," calling it "the nastiest question." This shows the sensitive nature of the topic and Trump's apparent unwillingness to fully engage with the criticisms surrounding his trade policies. The video serves as a concise summary of a complex issue, highlighting the market's volatility and the political implications of Trump's trade decisions.