Why are people calling Trump a TACO? What does TACO stand for? Here's what it means.
President Donald Trump's trade war tactics earned him the new nickname - "TACO Trump" - that continues to gain popularity among Wall Street investors, much to the president's disdain.
Trump announced on Truth Social a new China trade deal on June 11 that would bring down the tariffs: "Our deal with China is done, subject to final approval with President Xi and me."
On the same day, Treasury Secretary Scott Bessent floated the idea of extending trade tariff pauses with countries negotiating in good faith.
Here's what to know about "TACO," tariff negotiations and the "Trump Collar."
What is TACO Trump?
The term TACO — Trump Always Chickens Out — was coined by Financial Times commentator Robert Armstrong to describe what he says is the presidents pattern of announcing heavy tariffs on countries causing economic shock, panic and stock market hits and then later reversing course with pauses or reductions that create a market rebound.
When asked about TACO by a reporter, Trump responded, “I chicken out? Oh, I’ve never heard that. You mean because I reduced China from 145% that I set down to 100 ... and then to another number?” He went on to defend his decisions to slash tariffs on China for the next 90 days and extend his deadline for a 50% tariff on goods from the European Union until July 9.
Trump said "because I gave the European Union a 50% tax tariff, and they called up and they said 'please let’s meet right now, please let's meet right now,' and I said OK, I'll give you until July." He then clarified that they weren't willing to meet initially, "And after I did what I did, they said, 'we'll meet anytime you want.' You call that chickening out?"
"Six months ago, this country was stone cold dead. We had a dead country. We had a country that people didn't think it was going to survive," Trump said. "And you ask a nasty question like that. It's called negotiation."
"Don't ever say what you said because that's a nasty question," Trump said.
After the reporter's TACO question and Trump's heated response, taco and chicken related memes went viral, including an old Cinco de Mayo tweet by the President himself.
What is the Trump Collar?
As TACO Trump gained popularity, Nomura's strategist Charlie McElligott came up with "Trump Collar" in the same vein. In finance, a collar is a risk management strategy for stock owners that protects from big losses but also limits gains — creating a range within which the stock's price can fluctuate without significant profit or loss.
McElligott likened the collar term to how the stock market reacts to Trump. It may want to go up, but Trump's random social media posts and trade-tariff remarks can make the market nervous and volatile.
“You all know ‘Art of the Deal’ Trump … and over the past month+, the ‘TACO’-kind … but what it all adds up to now is the de facto ‘Trump Collar,’ as the market retrains the reaction function in the ‘Human VVIX’ era,” said McElligott according to MarketWatch.