Trump calls a question about taco trade the disgusting

Trump calls a question about taco trade the disgusting

Wall Street has experienced a historic roller coaster ride in recent months, which is characterized by the recurring customs threats of President Donald Trump. Investors are now learning to enjoy their statements with caution - and maybe also with a pinch of humor.

The phenomenon taco

A new concept of trade has appeared: Taco, which stands for "Trump Always Chickens Out". To put it simply, this means that you shouldn't worry too much about Trump's latest customs threats, since it is ultimately soaked back, which can lead to a decline in exemption in the markets.

Trump's words and customs adjustments

Trump expressed that he heard the term of Robert Armstrong, a commentator of the Financial Times, for the first time when a journalist asked about it. "I switch back? Oh, I've never heard that. Do you mean because I have reduced the customs rate for China from 145 % to 100 % and then to another number?" Trump said, alluding to the customs sets he imposed for Chinese imports. The sentence is currently 30 % after Trump raised it to up to 145 % last month, just to reduce it a few weeks later.

Current developments to tariff

Last week Trump threatened to raise tariffs of 50 % on goods from the European Union on June 1st. The stock markets reacted negatively to his threat, which he later reaffirmed that day by explaining that there was no scope for negotiations. Two days later he announced that he would wait until July 9 to impose the 50 % tariffs on EU goods after having held promising discussions. When the US markets opened again after the Memorial Day, the share prices clearly closed in plus.

negotiations or back?

Trump said he was ready to delay this step because EU representatives offered him: "Please, let's meet immediately." When asked if that was not a back, Trump replied: "Are you calling chickening out?" And thus referred to his latest announcements to tariffs on EU and Chinese goods.

Trump's customs strategy

"This is called a negotiation," added Trump and explained that part of his tactic consisted of initially determining "an absurd high number" for customs duties, in order to then reduce when other countries add its demands. "Never say what you said," Trump cited the reporter and described the question as "the most common question".

a review of his customs policy

The turns in relation to the tariffs against China and the EU are by no means the only ones that Trump has done. On April 2, he announced comprehensive “mutual” tariffs to dozens of countries that were to come into force on April 9. Hours after the tariff came into force, however, he announced a 90-day break for all affected countries with the exception of China, since the investors were "excited".

market reaction to customs changes

this means: The US financial markets, especially the bond market, did not take up its customs changes very well. In fact, the markets had fallen before the announcement of the break and the S&P 500 was about to slip into a bear market while the bond dates got up because the investors sold US debts.

positive market reactions after the announcement

After the announcement of the break, the S&P 500 has recorded the best price gains in one day.