TACO 'Strikes Again,' Says Peter Schiff As Trump Calls Xi Jinping 'Wonderful President' Amid China Trade Escalation: What Economists Are Saying

Group 1 - Economists are reacting to President Trump's recent tariff escalation against China and the subsequent retraction, which led to a sharp selloff in risk assets [1] - Economist Peter Schiff coined the term "TACO" (Trump Always Chickens Out) to describe Trump's tendency to make threats without follow-through, particularly regarding tariffs [2] - Vice President JD Vance characterized Trump's 100% tariff threat as a negotiation tactic, indicating a lack of seriousness in the threat [2] Group 2 - Trump reassured investors via a Truth Social post, stating that concerns about China should be alleviated and that the U.S. aims to help China rather than harm it [3] - Economist Mohamed El-Erian noted Trump's comments about Chinese President Xi Jinping having a "bad moment," suggesting a desire for stability rather than conflict [3] - University of Michigan economist Justin Wolfers compared the U.S.-China trade relationship to a tumultuous middle school romance, highlighting its unpredictable and dramatic nature [4]