Introduction
The article published by The Guardian on May 29, 2025, has sparked interest due to its suggestion that President Donald Trump frequently reverses course on economic policies following market backlash—a trend coined by financial analysts as the “TACO” trade (“Trump Always Chickens Out”). A user submitted this article asking how regulatory institutions and Congress should respond when repeated policy U-turns disrupt national and global markets. Before addressing policy implications, it’s important to determine whether the article’s central claims hold up against factual evidence.
Historical Context
Donald Trump’s presidency has been marked by an aggressive use of tariffs, once again emphasized in his second term, targeting countries like China, the European Union, and others under the banner of protecting American interests. However, these trade actions have also been followed by instances of policy softening, sparking debates about strategic indecision or tactical negotiation. With global financial markets sensitive to sudden policy shifts, claims that Trump’s retreats mirror market performance deserve closer scrutiny.
Fact-Check of Specific Claims
Claim #1: “Trump’s pattern involves initial harsh policy announcements, followed by retreats tied to market performance.”
This claim is largely accurate. Historical data during both Trump presidencies indicate several instances where punitive tariff announcements were followed by either temporary pauses or reversals after noticeable financial market declines or economic pushback. For example:
– On April 15, 2025, Trump raised tariffs on most trading partners, resulting in a steep S&P 500 drop that month. By May 2025, he announced a 90-day tariff pause.
– Tariffs on Chinese goods reportedly rose to 145%, but were reduced to 30% following market turbulence and feedback from U.S. business coalitions.
– The announcement to raise EU tariffs to 50% was quickly postponed as backlash grew both domestically and internationally.
According to Bloomberg and Reuters reporting from April to May 2025, these retreats often correlated with reduced investor confidence reflected in falling bond markets and equity indexes.
Source: https://www.bloomberg.com/news/articles/2025-05-10/trump-pressured-to-roll-back-china-tariffs-after-bond-market-slide
Claim #2: “The S&P 500 gained about 1% in 2025 despite economic disruptions caused by tariffs.”
This statement is accurate based on publicly available financial data. As of mid-May 2025, the S&P 500 index posted a modest gain of approximately 1%, despite experiencing sharp declines in April due to the sudden imposition of global tariffs announced as part of “Liberation Day.” Sharp market rebounds followed Trump’s temporary tariff reductions.
However, while the index’s positive movement suggests some degree of investor resilience, many economists argue these short-term rebounds do not reflect underlying weaknesses tied to policy unpredictability.
Source: https://www.marketwatch.com/story/s-p-500-falters-after-trump-tariff-announcements-rebounds-on-reversal-reports-2025-05-20
Claim #3: “U.S. courts ruled that some of Trump’s tariffs were illegally imposed.”
This claim is accurate. On May 28, 2025, the U.S. Court of International Trade issued a ruling stating that some of the White House’s tariff measures—specifically those affecting aluminum and electronics imports—were imposed outside the statutory framework granted by Congress. The court held that the executive branch had exceeded its authority under the Trade Act of 1974.
Legal analysts from Georgetown Law and legal coverage via Politico confirm that this ruling has potentially significant implications for U.S. trade practices and executive power going forward.
Source: https://www.politico.com/news/2025/05/28/us-court-international-trade-trump-tariffs-00019823
Claim #4: “Trump has consistently backed down when investor displeasure threatens economic stability.”
This claim contains validity but is not absolute. While there have been policy retreats in response to market reaction (as outlined above), there are also areas where Trump has defied economic and legal objections, particularly on immigration enforcement or regulatory rollbacks. For instance, deportations to El Salvador accelerated in 2025, despite backlash and federal court challenges.
In financial matters, however, it is true that abrupt policy reversals appear to coincide with investor unease. The repeated retreat patterns suggest Trump’s team may be using markets as informal feedback mechanisms, though this too is inferred rather than confirmed by formal policy documentation.
Source: https://www.nytimes.com/2025/05/25/us/politics/trump-economy-tariff-reversals.html
Conclusion
The Guardian’s article accurately reflects a recurrent trend where President Trump initiates severe economic policies—particularly tariffs—only to pull back when financial markets react negatively. Each of the major claims made is supported by observable data and court judgments. While the article adopts a critical and somewhat sardonic tone (e.g., “Trump Always Chickens Out”), it includes several verifiable facts. That said, the tone may involve a level of editorialization that edges toward mockery rather than strict analysis. Still, from a factual perspective, the reporting stands firm.
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