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There’s a new trade in town. The “Taco” trade refers to an investment approach that presumes “Trump Always Chickens Out.” Last week, the U.S. president’s thin-skinned response to the jibe indicated that it hit a nerve. But as Alex Dryden of the University of London’s School of Oriental and African Studies explains, there are real-world implications beyond just Trump’s hurt feelings.
Because if it’s accepted that Trump does indeed always chicken out, this belief could become baked into investment approaches. The assumption that Trump will back down at the first sign of trouble might inure investors to risks on the horizon – they presume the president will row back. And, of course, one day he might not.
Being called “chicken” has clearly ruffled Trump’s feathers. With his pride dented, perhaps next time things look dicey he’ll dig his heels in and deny detractors the chance to mock him. One thing is clear. Making assumptions about this president – and the decisions he’ll make in times of stress – looks increasingly risky.
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Alex Dryden, SOAS, University of London
Trump clearly resents the jibe – and if it encourages him to double down on bad decisions the economic results could be serious.
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Work
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Jonathan Lord, University of Salford; Gordon Fletcher, University of Salford; Saad Baset, University of Salford
Private messages are increasingly being invoked in workplace disputes.
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Credit rating agencies
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Daniel Cash, Aston University
A successful African rating agency would shift power in global finance.
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Wages
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John Buchanan, University of Sydney
Even with this increase, Australia’s lowest paid employees will not be earning as much in real terms as they did before the inflationary surge of 2021-2022.
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Technology
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Greg Edwards, Missouri University of Science and Technology
Even the most advanced AI tools are useless if employees don’t feel confident using them. Building trust and boosting workers’ belief in their abilities is the real key to successful adoption.
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Nitin Deckha, University of Guelph-Humber
As AI becomes more capable and embedded in daily routines, anxieties surrounding it are likely to intensify.
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