How can the Taco trade end with the opposite results on investors

• Investors have seen Trump’s most extreme trade policies like deception.

• But without financial markets to verify Trump, will a reverse return?

• Ben Ener, a genetically modified organism, says that a weak reaction to the definitions can encourage Trump.

DIP purchased during the recent tariff fluctuation was a profitable strategy this year, but it will be called the so -called Taco Trade Reverse results on the upscale investors are sure that the president will always retreat?

It didn’t take long for investors to know that Trump does not always mean what he says when it comes to commercial policy. Taco Trade – which was short for “Trump always a chicken”, a phrase formulated by Robert Armstrong in the Financial Times to describe Trump’s habit in retracting the proposals that the customer markets – have emerged as a result.

Investors began not to take Trump seriously, believing in the proposals of his most extreme policy, such as comprehensive definitions or Shooting the president From the federal reserve, just a trick.

But Ben Enker, the co -chair to allocate assets at GMO, argues that this approach may have opposite results.

The markets have worked as Trump’s verification this year. The President stopped the customs tariff in April after historical sales in both stocks and bonds, and he retracted ideas such as Jerome Powell’s launch as head of a lecture after the markets were occupied.

Now, with apparently less ready investors for sale after every bold proposal of Trump, he may not have a great incentive to retract his trade war, which he gained again this week. The President launched messages throughout the week, which included threats of 25 % of the tariffs on Japan and South Korea, 50 % tariffs on Brazil, and 35 % in Canada.

The shares fell on Friday as Trump re -trade the trade war, but it was not the same as the sale in April, although some of the definitions announced in the week are more slope than expected.

“What we see today is that Trump is more aggressive.”

He said that Trump’s recent announcement of a 50 % tariff for Brazil is “an aggressive position that assumes that you can do what you want, which is completely different from what we saw while retracting the Tahrir Day tariff when the bond market began crazy.”

“In the absence of the financial markets that tell him to decline, he will not retreat,” he added.

Investors have not recently been seeking negative risks. S&P 500 and NASDAQ has reached its highest level ever on Thursday, and high evaluations

Inker said that the analogy is more likely approaching 40 % of the value.