“Do I deflate myself?” ! »At the White House on Wednesday, Donald Trump did not hide his irritation in the face of a journalist who questioned him about the vogue acronym for Wall Street, “Taco”, for “Trump is still deflating”.
“I have never heard that,” launched the stormy president of the 78 -year -old to the journalist who asked her to react to the expression, then indignant with a “dirty question”. These back and forth, “it’s called negotiation,” he justified.
“Taco theory”
The “Taco theory” (“Trump Always Chickens Out” in English) was recently born from Robert Armstrongan editorial writer of the financial daily Times, who underlined the trend observed in the volatile American president to turn around on his own decisionswhen these waved the stock market indexes too much.
Investors “realize that the US administration does not have a strong tolerance for economic and market pressures, and that it will be quick to retreat when customs duties will suffer. This is the theory of Taco: Trump always deflates “Wrote the editorialist in early May.
The stock markets had just experienced a strong rebound after the announcement ofA break on colossal customs duties imposed on the rest of the world by the tenant of the White House.
Donald Trump announced the entry into force from June 1 of customs duties 50 % on imports from the European Union, before finally decree, two days later, a break until July 9.
“It’s called negotiation”
Behind these reversals, resides the idea for many observers that the New York affairs magnate remains very sensitive to markets. These would thus be, as in its first mandate, one of the only ways to change their minds the republican billionaire.
Beyond the columns of the Financial Times, the “Taco theory” has taken off, until it was used by financial analysts.
“The TACO exchange strategy again attracts attention,” said John Hardy’s podcast on Monday, head of macroeconomic strategy at the Danish investment bank Saxo.
For Steve Sosnick of Interactive Brokers, the Taco strategy is a “non -political way for the markets to say that the bluff administration”.
The president attached to protectionism
In the first weeks of returning to the White House of the Republican billionaire, Wall Street reacted negatively to the new customs of customs from customs in a “much larger and direct” manner than today, is also with AFP Sam Burns, analyst of Mill Street Research.
From now on, his remarks are considered by financial actors “as easily reversible or unreliable”, adds Sam Burns, and as a result, “investors and traders are more and more comfortable” at the idea of going “against the natural reaction” that they could have.
A trend much more present than during Donald Trump’s first term, he notes.
The New York Stock Exchange had not grieved in the face of customs threats targeting the EU and also did not surrect on two judicial decisions on Thursday, the first blocking a large part of customs duties Imposed by the Trump administration, the second – in summary proceedings – restoring them time to examine the bottom of the file.
John Hardy warns, however, that this “taco theory” is far from infallible, and that we should not lose sight of the protectionist movement initiated by the president of the first world power.
“Donald Trump can actually deflate At times, but its underlying policies are very real and constitute a very serious change in the economic and industrial policy of the United States, “he said in a recent article.
