{"id":1546505,"date":"2025-07-11T13:45:00","date_gmt":"2025-07-11T17:45:00","guid":{"rendered":"https:\/\/bugaluu.com\/news\/?p=1546505"},"modified":"2025-07-11T13:45:00","modified_gmt":"2025-07-11T17:45:00","slug":"did-taco-trades-just-get-burritod","status":"publish","type":"post","link":"https:\/\/bugaluu.com\/news\/did-taco-trades-just-get-burritod\/1546505\/","title":{"rendered":"Did TACO Trades Just Get Burrito’d?"},"content":{"rendered":"

Did TACO Trades Just Get Burrito’d?<\/span><\/p>\n

\n

Via Rabobank,<\/em><\/p>\n

A combo of confidence, arrogance, and ignorance has seen continued TACO trades on tariffs<\/strong>:<\/p>\n

Trump always chickens out, say those who just watched him bomb Iran\u2019s nuclear sites with vastly fatter tail risks than a spike in CPI (the fear of which overlooking Japanese car-markers just cut prices 19.4% to keep access to the US market).\u00a0<\/em><\/p>\n

But did that just get burrito-ed?<\/strong><\/p>\n

<\/a><\/p>\n

True, the Vietnamese government still hasn\u2019t formally accepted the trade deal announced, showing how unhappy they are with 20% tariffs.\u00a0Yet Trump just dropped a bomb in stating he plans to impose rates of 15% or 20% on most trading partners, not 10%.<\/strong><\/p>\n

He also dropped a 35% tariff on non-USMCA compliant goods from Canada starting 1 August<\/strong>\u00a0with any counter tariff rate stacked on top: no transshipped goods from Canada will be allowed. Can you see what was flagged here months ago: that the US would set the level of the USMCA external tariff, forming a Fortress North America?<\/p>\n

A similar Trump letter could go out to the EU today<\/strong>: will it say 10%, 15%, 20%, or 35%, and will everyone continue to buy EUR on the back of it \u201cbecause markets\u201d? Perhaps: but, what a croque, monsieur or madame. There\u2019s no ham in that toasted sandwich if you open it up and look.<\/p>\n

That\u2019s as Politico claims it was\u00a0\u201cBRICS-fuelled anger\u201d around de-dollarisation behind the recent 50% tariff threat to Brazil<\/strong>, as I\u2019d flagged: \u201cThe White House concluded that non-tariff methods for punishing Brazil would take too long, two people familiar with the situation said.\u201d\u00a0Brazil\u2019s President Lula has threatened counter tariffs and said he isn\u2019t obliged to use the dollar for trade<\/strong>: is he referring to the BRICScoin that doesn\u2019t exist, or to barter, or to gold, or CNY?\u00a0Somebody\u00a0will be eating humble taco ahead there \u2013 place your trading bets accordingly.<\/p>\n

However,\u00a0other reports have the US lifting tariffs on Israel ahead<\/strong>: geopolitics sets your rate.\u00a0<\/p>\n

Staying in geoeconomics,\u00a0a US metals magnate praised \u201cintelligent\u201d national security tariffs on copper and dismissed any market reaction as \u201cirrelevant.\u201d<\/strong>\u00a0Who knew markets come second when America comes first? Those who saw we are in a world of economic statecraft, not policy.<\/p>\n

Similarly,\u00a0US rare earths firm MP Materials announced a \u201cTransformational public-private partnership\u201d with the Pentagon\u00a0<\/strong>worth billions including a new \u201c10X\u201d magnet facility, a 10-year price floor and offtake agreements, and the Department of Defence positioned to become its largest shareholder to create \u201ca national champion, built to scale.\u201d What and where next?<\/p>\n

Bloomberg today runs a rebuttal of US tariffs aimed at local shipbuilding, but makes the argument this needs integrated economic statecraft from tariffs to\u00a0subsidies<\/strong>\u00a0to infrastructure to labour –as do copper, steel, and aluminium, required as inputs– as well as a push to compete globally for economies of scale.\u00a0So, either bank on that happening for national security reasons, or on no maritime national security and \u201cbecause markets.\u201d\u00a0There are huge implications either way.<\/p>\n

Moreover,\u00a0as the latest projections show we are apparently very far from peak global oil and gas demand,<\/strong> OPEC+ just barred major media organisations from their meeting.<\/p>\n

In geopolitics, Secretary of State Rubio called for a new approach to peace re: Ukraine;\u00a0Trump said there could be \u201ca major statement\u201d on Russia Monday<\/strong>; Axios reports the US is to sell weapons to NATO to provide to Ukraine; and the UK and France will \u201cpolice Ukraine\u2019s skies\u201c and seas if Russia agrees to a ceasefire.\u00a0That sounds expensive, with fat tail risks: so, TACO?<\/p>\n

Reports suggest\u00a0Israel could soon strike Iran <\/strong>again\u00a0as the latter scuttles about its nuclear sites with intent.\u00a0Jerusalem is also urging the US to resume strikes on the Houthis<\/strong> and form a broad coalition, after two commercial ships were sunk this week, impacting far more than Israel alone.<\/p>\n

Moreover, as The Economist calls to end the west\u2019s failed asylum system (when you\u2019ve lost The Economist\u2026), there\u2019s more\u00a0entente cordiale\u00a0via\u00a0a UK-French \u201cone in, one out\u201d asylum-seeker pilot scheme\u00a0<\/strong>which will swap one who crosses the Channel for one from France who can show they have family connections in the UK \u2013 but, according to some reports, only up to 50 people a week, and in any case not reducing the total number of asylum-seekers in both countries.<\/p>\n

In politics,\u00a0a US judge placed a new block on Trump\u2019s birthright citizenship order<\/strong>\u00a0by claiming a class action weeks after the Supreme Court had blocked the use of far-reaching district court injunctions against the executive, and Justice Alito had specifically warned not to use spurious class actions to end-run it. This week also saw a lower-level judge try to overrule Congress, worth considering as the financial press worries about executive over-reach: everyone is.<\/p>\n

Staying with the law, Trump said of FBI investigations into ex-CIA head Brennan and ex-FBI head Comey over suggestions of faking the evidence re: Russiagate: “Maybe they have to pay a price.\u201d<\/strong>\u00a0That\u2019s as former Epstein lawyer Dershowitz raised his hand to God and swore he knows that documents are being suppressed to protect individuals pertaining to this scandal, and he knows who is doing the suppressing.<\/p>\n

California Governor Newsom\u2019s team signalled he may redistrict ahead of the critical 2026 midterms if Texas does the same to gain GOP seats – except California has an independent redistricting commission; four Republican senators threatened to reverse President Trump’s DOGE cuts to funding for NPR and PBS, seeing him threaten to refuse to support them; and\u00a0Axios states \u2018MAGA on “amnesty watch” as Trump weighs migrant worker protections\u2019 as the base wants no watering down of promises to deport millions, regardless of the economic consequences.<\/strong><\/p>\n

Not to leave Europe out,\u00a0Germany\u2019s Rhineland-Palatinate banned any member of an extremist organisation –which they say covers the AfD Party leading opinion polls– for working for the civil service or police,<\/strong> etc.\u00a0Coming just after a French police raid on the populist National Rally HQ, one wonders if that will get slipped into the Trump letter to the EU, as with Brazil.<\/p>\n

In markets,\u00a0there was excitement about a potential Chinese property bailout yesterday<\/strong>: yet that was as The People\u2019s Daily argued for reintroducing \u201ccomrade\u201d as title and pronoun rather than \u201cBoss\u201d, \u201cMiss\u201d, or \u201cTeacher\u201d; or \u201cLeveraged Wall Street trader thinking a housing bubble is common prosperity\u201d – in either China or the US?<\/p>\n

The White House continued its new front vs Fed Chair Powell, <\/strong>with the director of the OMB also attacking him for the \u201costentatious\u201d $2.5bn refurbishment of the Fed\u2019s HQ as the FT\u2019s Big Read asks, \u2018Can the Fed stay independent under Trump?\u2019, overlooking that it hasn\u2019t been for a large chunk of its existence, and critics question how independent of lobbyists it can ever be.\u00a0<\/p>\n

That FT report includes the line that even the janitor knows who the worst Fed chair was: the 70\u2019s Burns, who looked through massive commodity-driven headline inflation to please politicians. Fair enough, but who was the second worst: Greenspan, Bernanke, or Yellen?<\/p>\n

Lastly, and this time not a multi-tasking typo,\u00a0Bitcoin this morning is sitting at a record $116,500, with the S&P and Nasdaq also at all-time highs.\u00a0<\/strong><\/p>\n

Who thinks they need to chicken out of what from here?<\/strong><\/em><\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nFri, 07\/11\/2025 – 09:45<\/span><\/p>\n

\u200bhttps:\/\/www.zerohedge.com\/markets\/did-taco-trades-just-get-burritod<\/a>\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

Did TACO Trades Just Get Burrito’d? Via Rabobank, A combo of confidence, arrogance, and ignorance has seen continued TACO trades on tariffs: Trump always chickens…<\/p>\n","protected":false},"author":0,"featured_media":1546506,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1546505","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","wpcat-1-id"],"_links":{"self":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1546505","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/comments?post=1546505"}],"version-history":[{"count":0,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1546505\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media\/1546506"}],"wp:attachment":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media?parent=1546505"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/categories?post=1546505"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/tags?post=1546505"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}