The Trump TACO Trade Leaves Wall Street Wondering What Comes First

NEW YORK – Once again, the specter of tariff threats looms large as President Donald Trump prepares to impose substantial duties on numerous U.S. imports, spanning copper, pharmaceuticals, and various goods from Japan and Russia.However, Wall Street seems unfazed, with some investors anticipating Trump will eventually retreat from his more extreme proclamations. This phenomenon has been labeled the TACO trade—an acronym for “Trump Always Chickens Out.”“He pushes us toward calamity and then, at the last moment, pulls back and claims, ‘Look, I saved us,’” stated Michael Block, a market strategist at Third Seven Capital, in a Tuesday CNN phone interview.Earlier this month, Trump shocked investors with hefty "Liberation Day" tariffs, which triggered fears of a recession. The ensuing market turmoil compelled Trump to pause those tariffs for 90 days, facilitating a remarkable market rebound.Moving to this week’s sequel, U.S. stocks dipped on Monday after Trump issued tariff notices for implementation on August 1. Yet, the decline was mild—arguably a healthy correction from record highs.Markets remained stable on Tuesday as Trump proposed a 50% tariff on copper, an up to 200% tariff on pharmaceuticals, and a 10% tariff on nations within the BRICS economic alliance. “At the end of the day,...

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