The TACO Kid: Wall Street is mocking Trump — and it has nothing to do with his diet

Wall Street investors are using a new strategy when it comes to President Donald Trump’s flip-flopping tariff policies.

The stock market has been on a roller coaster ride since Trump announced costly tariffs on imports into the United States and then later backed down on them. Now, some investors are using a new term to describe a strategy for Trump’s tumultuous tariff policy.

The acronym, TACO, stands for “Trump Always Chickens Out” and was reportedly coined by a Financial Times columnist, according to The New York Times.

The New York Times reported that investors are using the term to describe how markets plummet after Trump makes tariffs threats, only to rebound days later when he backs down. He has done this numerous times since April, claiming that he is just giving countries more time to strike a trade deal with the U.S.

The latest example came from Trump’s recent threat to the European Union, which he said was formed “for the primary purpose of taking advantage of the United States on TRADE.” He threatened the bloc with 50% tariffs starting on June 1, but quickly rescinded his threat after the EU said it would schedule trade negotiations.

Chris Beauchamp of IG Group said in a post that “TACO trade triumphs once again” after Trump backed down on the EU tariff threat. His post was first highlighted by The New York Times.

“​Since the first tariff pause back in April, the TACO acronym has become common among investors. It stands for ‘Trump Always Chickens Out’,“ Beauchamp wrote in his analysis.

“Each apparent escalation of the trade war has been followed up by a pause, a pattern that was apparent before April when the US president began to make pronouncements about Canada and Mexico, the prelude to his assault on the global trade system on ‘Liberation Day,’” he added.

U.S. stocks are holding steadier on Wednesday, a day after leaping back within a few good days’ worth of gains from its all-time high.

The S&P 500 was up 0.2% in early trading. It’s sitting 3.5% below its record after charging higher amid hopes that the worst of the turmoil caused by Trump’s trade war may have passed. It had been roughly 20% below the mark last month.

The Dow Jones Industrial Average was up 60 points, or 0.1%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.2% higher.

The Associated Press contributed to this report.

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