Despite Trump’s offer to negotiate a “complete total resolution” of hostilities, for Iran, no-one believes anything the US president says. Bitter experience has led Iran and many other countries, especially those of the Global South, not to place any credence on his diplomacy or negotiation tactics.

The original threat, issued on Saturday, warned that the U.S. would “obliterate” Iranian power plants and energy infrastructure if the Strait of Hormuz was not fully reopened to all shipping traffic.

Key Details of the “Backdown”

* Five-Day Reprieve: Trump instructed the Department of War to postpone all military strikes for a five-day period to allow for ongoing negotiations.

* Diplomatic Channels: Trump stated that his envoys, Steve Witkoff and Jared Kushner, had been in talks with a “respected” Iranian leader. However, Iranian officials, including Parliament Speaker Mohammad Bagher Qalibaf, denied that any formal negotiations had occurred, dismissing the claims as “fake news”.

* Retaliation Threats: The reversal followed a stark warning from Tehran that it would strike power and desalination plants across the Middle East—specifically those supplying U.S. military bases—if the U.S. targeted Iranian infrastructure.

* Economic Impact: Following the announcement of the pause, global oil prices plunged and major U.S. stock indexes saw significant gains as market fears of an immediate escalation eased.

While Trump framed the delay as a chance for peace, he maintained a aggressive stance, telling reporters that if talks fail, “we’ll just keep bombing our little hearts out”.

“TACO” is a Wall Street acronym standing for “Trump Always Chickens Out,” used to describe Donald Trump’s tendency to threaten strict tariffs or foreign policy actions, only to back down or delay them later. Coined around May 2025, it refers to the “TACO trade”—buying stocks low during the initial threat and selling higher after the reversal.

Key Aspects of TACO:

* Meaning: Trump Always Chickens Out.

* Context: Used in the financial sector regarding trade wars and tariff threats (e.g., against China or Europe) that are subsequently reversed or reduced.

* Wall Street Reaction: Investors often use this pattern to predict market rebounds, treating the threats as negotiations rather than permanent policy.

* Trump’s Response: Trump has criticized the term as “nasty,” arguing that his actions are not backing down but rather a “negotiation” tactic of starting with high demands.

* Origin: The term gained prominence in May 2025 regarding the “Liberation Day” tariffs.

The term is often applied to foreign policy situations where threat reversals occur, such as situations concerning Iran or Greenland.

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