Understanding the TACO Theory in Today's Market

January 21, 2026 - 03:01

Tom Essaye of Sevens Report has provided insights into the "Trump Always Chickens Out" (TACO) theory, asserting its relevance in today's tumultuous market environment. According to Essaye, this theory serves as a crucial framework for investors navigating through the overwhelming barrage of headlines surrounding former President Donald Trump.

In a landscape filled with uncertainty and volatility, the TACO theory suggests that any dips in the market should be viewed as buying opportunities. Essaye emphasizes that historical patterns indicate Trump’s tendency to retreat from confrontational stances, which often leads to market recoveries following initial declines.

Investors are urged to maintain a long-term perspective, recognizing that short-term fluctuations driven by political developments can present advantageous entry points. As market participants grapple with the noise of daily news cycles, the TACO theory offers a pragmatic approach, encouraging a focus on fundamentals rather than getting swept away by momentary panic.