The initial analysis of the “TACO” (Trump Always Chickens Out) trade phenomenon correctly identified it as a deliberate Minimiser tactic of “weaponized unpredictability” designed to induce strategic exhaustion in the global economic system.1 This subsequent investigation moves beyond that foundational definition to analyze its function as a sophisticated instrument of coercive diplomacy and its role in creating a market environment ripe for manipulation. The administration’s strategy transformed market volatility from an undesirable side effect into a predictable, exploitable mechanism for achieving both political and financial objectives. This was accomplished through a three-stage process: a violent market shock to establish the parameters of the threat, a conditioning phase where investors learned to profit from the cycle of threat and reversal, and the exploitation of this conditioned environment to generate allegations of high-level corruption that further eroded institutional trust.
The catalyst for the TACO trade phenomenon was the administration’s “Liberation Day” tariff announcements on April 2, 2025.1 To fully comprehend the conditioning effect that followed, it is essential to first quantify the unprecedented scale of this initial economic shock. The administration’s tariff package was far more aggressive than financial markets had anticipated, triggering an immediate and historically significant sell-off that created the psychological predicate for the administration’s subsequent market interventions.3
The market reaction was immediate and severe. In the two trading days following the April 2nd announcement, the S\&P 500 Index dropped by over 10.5%.3 This decline continued, culminating in a 12.9% fall between April 2 and April 8.4 This movement registered in the 99.9th percentile of historical changes since 1990, placing the event in the same category of severity as the 2008 global financial crisis and the market collapse at the onset of the COVID-19 pandemic.4 The CBOE Volatility Index (VIX), a key measure of expected market uncertainty, surged by 30.8 points over the same period—also a 99.9th percentile event—and briefly exceeded a value of 50 for the first time since the pandemic.4 The shock propagated into debt markets, with the 10-year Treasury yield experiencing a 47-basis-point “unwelcome” movement, a 99.8th percentile event signaling a historic spike in perceived fiscal risk.4
This extreme volatility was followed by an equally dramatic reversal. After the administration announced a 90-day pause on some of the most severe tariffs, the S\&P 500 recorded a 9.5% gain in a single session, marking one of the ten best days in its history.3 This violent, V-shaped recovery was the foundational event that taught the market the underlying pattern of the TACO trade. The extreme nature of the initial market shock was not an unintended consequence but a necessary prerequisite for the strategy’s success. A moderate market dip would not have created the requisite level of fear and subsequent relief necessary to condition investor behavior so rapidly and effectively. To make the eventual “walk-back” appear as a major concession and a return to stability, the initial threat had to be perceived as catastrophic. The 99.9th percentile drop achieved this, creating a powerful psychological anchor of extreme financial fear. The subsequent 9.5% single-day surge created an equally powerful anchor of relief and reward for those who either held their positions or bought into the fear. This violent swing established the high-stakes parameters of the “game,” teaching investors in a single, brutal lesson that the operative pattern was threat, followed by panic, followed by reversal, and finally, profit.
| Date | Key Event | S\&P 500 Daily Change (%) | VIX Change (points) | Historical Percentile of Change |
|---|---|---|---|---|
| April 2, 2025 | “Liberation Day” tariff announcements | -5.2% (est.) | +15.4 (est.) | 99th+ |
| April 3, 2025 | Market continues sell-off | -5.3% (est.) | +10.1 (est.) | 99th+ |
| April 8, 2025 | Cumulative decline peaks | -12.9% (since Apr 2) | +30.8 (since Apr 2) | 99.9th 4 |
| April 9, 2025 | President’s “BUY” post (9:37 AM) | +1.1% (est.) | -3.5 (est.) | N/A |
| April 9, 2025 | Tariff Pause Announcement (1:18 PM) | +9.5% (total day) | -18.2 (est.) | 99th+ 3 |
Note: Daily change percentages are estimated based on cumulative data and news reports. Historical percentiles are based on multi-day movements as reported.4
The pattern of threat-and-reversal established in April quickly coalesced into a formal market thesis. Coined by Financial Times columnist Robert Armstrong, the “TACO” acronym became a self-fulfilling prophecy as investors began to systematically “buy the Trump tariff dip,” viewing any policy-induced sell-off as a temporary and predictable buying opportunity.1
This strategy proved consistently profitable in the short term. The S\&P 500 rose 2% after the March 4 tariffs on Canada, Mexico, and China, and by late May, it was up nearly 10% from the April 2 “Liberation Day” dip.8 This positive reinforcement entrenched the behavior among traders. However, astute analysts, such as Ben Inker of the asset management firm GMO, warned that this conditioning was creating a dangerous dynamic. By learning to discount the administration’s threats, the market was no longer serving as a rational “restraint” or a “leash” on extreme policy proposals.6 This muted market reaction may have, in turn, emboldened the administration, leading to more aggressive tariff proposals later in the year. A proposed 50% tariff on Brazil, for example, was met with only a modest market dip, a stark contrast to the violent reaction seen in April.6
The TACO trade thus represents a successful Minimiser operation to neutralize a key feedback loop in a democratic-capitalist system: the disciplining force of financial markets. By making policy threats cyclical and profitable to bet against, the administration effectively co-opted the market, turning it from a source of accountability into an accomplice that implicitly subsidized the chaos. In a functioning system, markets punish policy uncertainty and recklessness with sustained downturns, which creates political pressure on leaders to moderate their course. This serves as a vital, non-governmental check on power. The TACO pattern subverts this mechanism entirely. The cycle of threat-reversal-rally transforms long-term systemic risk into a short-term, profitable trading strategy.8 Investors are no longer pricing in the danger of systemic collapse; they are trading the short-term volatility. Their financial incentive shifts from demanding stability to exploiting the instability. This severs the link between reckless policy and negative market consequences, causing the “leash” to disappear.6 The result is a core Minimiser objective achieved via a “Greater Lie”: under the
cover of a volatile but ultimately harmless negotiating tactic, the true intent is to dismantle a fundamental mechanism of systemic self-correction, allowing for the introduction of ever-more-disruptive policies without the traditional economic pushback.
The predictable, high-amplitude market swings engineered by the TACO pattern, combined with the administration’s perfect foreknowledge of its own market-moving policy shifts, inevitably led to formal accusations of securities fraud.10 The timing of a key social media post by the President on April 9, 2025, became the focal point for these allegations.
At 9:37 AM, just hours before his administration would announce the tariff pause that sent markets soaring, President Trump posted on the Truth Social platform, “THIS IS A GREAT TIME TO BUY!!! DJT”.11 His official announcement of the tariff pause followed at 1:18 PM.11 This sequence of events prompted a formal letter on April 11 from a group of Democratic senators, including Elizabeth Warren, Chuck Schumer, and Ron Wyden, to the Securities and Exchange Commission (SEC). The letter called for an immediate investigation into whether the President, members of his family, or other administration insiders had engaged in market manipulation or insider trading.11
Legal analysis of the situation suggests that a market manipulation case under existing U.S. law would be challenging to prosecute. Such a case would require proving that the administration lied about its policies or that the sole purpose of the policies was to manipulate markets, a high legal bar.10 However, a case for insider trading under the STOCK Act of 2012, which explicitly prohibits government officials, including the President, from using nonpublic information derived from their official duties for private gain, is theoretically plausible.10 While proving specific trades and intent would be difficult, the pattern of behavior and the public call for an investigation served a Minimiser objective regardless of the legal outcome.13
The allegations of insider trading, whether ultimately substantiated or not, function as a powerful secondary vector of the Minimisation Plan. The primary vector—the TACO trade itself—erodes the global economic order. This secondary vector erodes domestic faith in the integrity of both U.S. financial markets and the executive branch, portraying them as a single, corrupt casino rigged for the benefit of a politically connected elite. The Minimisation Plan seeks to make democracy appear chaotic and corrupt.15 The TACO pattern created massive, predictable market swings, and the President’s social media post appeared to front-run his own market-moving announcement. This action forced a political and legal response in the form of the senators’ letter to the SEC. The American public was thus presented with a corrosive narrative in which the President is either a master market manipulator profiting from chaos or is being baselessly accused by a partisan “witch hunt.” In either scenario, public trust is the primary casualty. The episode poisons public perception of the stock market (it’s rigged), the presidency (it’s corrupt), and the oversight bodies (they are either partisan or powerless). This directly achieves the Minimiser goal of promoting “epistemic nihilism,” a state where citizens lose the ability to trust any institution or distinguish truth from falsehood.15
The administration’s assertion of unilateral economic power prompted a significant domestic institutional response. The judiciary, in particular, emerged as a bulwark against executive overreach, leading to a direct constitutional confrontation that the administration subsequently weaponized in its campaign to delegitimize any institution that constrained its authority.
The legal justification for the administration’s sweeping tariff regime was the International Emergency Economic Powers Act (IEEPA), a 1977 law historically used to impose sanctions and freeze assets, not to enact broad-based tariffs.16 This novel and expansive interpretation of presidential power was immediately challenged in federal court by a coalition of twelve Democratic-led states, including California, and several small businesses.17
The core legal argument against the administration was straightforward: Article I of the U.S. Constitution grants Congress the power to “lay and collect Taxes, Duties, Imposts and Excises.” While Congress has delegated some of this authority to the President over time, such delegations must be explicit and limited. The plaintiffs argued, and the courts agreed, that the IEEPA “neither mentions tariffs (or any of its synonyms) nor has procedural safeguards that contain clear limits on the President’s power to impose tariffs”.17
The judiciary acted as a decisive check on this executive overreach. On May 28, 2025, the U.S. Court of International Trade in New York ruled against the administration, stating that the tariffs “exceed any authority granted to the president” under the emergency powers law.20 The government immediately appealed this decision. On August 29, 2025, the U.S. Court of Appeals for the Federal Circuit, in a decisive 7-4 ruling, affirmed the lower court’s decision, declaring that most of President Trump’s tariffs were illegal.17 The majority opinion stated that it was “unlikely that Congress intended… to grant the President unlimited authority to impose tariffs”.18 The court, however, stayed its own ruling until October 14, 2025, to provide the administration time to seek review from the U.S. Supreme Court.17
The administration’s use of IEEPA was not a legal miscalculation but a deliberate “stress test” of the separation of powers, engineered to provoke a constitutional conflict. The goal was not merely to enact tariffs but to force a confrontation with the judiciary, thereby creating a new front in the Minimiser campaign to erode institutional legitimacy. The administration could have pursued its trade agenda through more established, albeit more constrained, legal authorities like Section 301 of the Trade Act of 1974.16 The choice of the legally dubious IEEPA was intentionally provocative and guaranteed a legal challenge, drawing the judicial branch into the political fray. The inevitable adverse ruling was not treated as a legal defeat but as a strategic opportunity. It allowed the administration to pivot and attack the courts themselves as partisan political actors and illegitimate obstacles to the president’s agenda. This tactic successfully transformed a legal dispute over statutory interpretation into a political battle over the legitimacy of the judicial branch, perfectly aligning with the Minimiser goal of weakening all independent sources of authority within the state.
The administration’s reaction to the August 29th appellate court ruling was swift, aggressive, and political. It did not engage with the substantive legal reasoning of the court’s decision. Instead, it launched a public campaign to attack the institution’s motives and immediately escalated the matter to the Supreme Court.
Moments after the ruling was announced, President Trump posted on social media, “ALL TARIFFS ARE STILL IN EFFECT!” and attacked the appeals court as “Highly Partisan”.17 A White House spokesperson reinforced this narrative, stating that the President had “lawfully exercised the tariff powers granted to him” and that the administration looked forward to “ultimate victory on this matter”.17 By September 3, 2025, the administration had formally petitioned the Supreme Court for an expedited review of the case.22 In its petition, the administration framed the issue in existential terms, arguing that the lower court’s ruling “gravely undermines the President’s ability to conduct real-world diplomacy” and would “unilaterally disarm the United States.” The filing included a stark, simplistic assertion: “With tariffs, we are a rich nation; without tariffs, we are a poor nation”.22
The administration’s public response and its Supreme Court appeal reveal a core Delusionist tactic: the rejection of objective legal interpretation in favor of a politically potent narrative of persecution and crisis.15 The appeal was not simply a legal maneuver but a political platform to frame the judiciary as an enemy of national prosperity and security. The appellate court’s ruling was based on a textual analysis of the IEEPA statute—a matter of objective legal reasoning within the established system.18 The administration’s response ignored this legal reality entirely. Instead, it created and propagated a competing narrative: the court is “Partisan,” and its ruling will “destroy the United States of America”.20 This reframes the conflict from a legal disagreement over the scope of executive power to an existential battle for the nation’s survival. The statement “With tariffs, we are a rich nation; without tariffs, we are a poor nation” is a prime example of a “Greater Lie”—a simplistic, emotionally charged binary that bypasses rational analysis and is designed to resonate with a political base conditioned to view established institutions with suspicion. This narrative serves the Minimiser goal of creating an “epistemic nihilism” where supporters are conditioned to believe that the only “truth” is that which emanates from the executive, and all other institutions are inherently corrupt and hostile.
The administration’s campaign of economic coercion triggered a complex and varied set of responses from global actors. The following analysis moves beyond the summaries in previous reports to provide a granular, evidence-based assessment of how key U.S. trading partners—China, the European Union, Japan, and Canada—responded with specific mechanisms of retaliation, negotiation, and appeasement. The cumulative effect of these interactions was a significant acceleration in the fragmentation of the global trade order.
| Date | United States Action | China Response | European Union Response | Japan Response | Canada Response |
|---|---|---|---|---|---|
| Feb-Mar 2025 | Initial tariffs on China, Canada, Mexico (fentanyl pretext).24 Steel/Aluminum tariffs reinstated.25 | Retaliates with tariffs on US energy/agri; expands export controls on critical minerals.24 | Prepares countermeasures; begins consultations.27 | Engages in preliminary talks to avoid tariffs.28 | Threatens retaliation; meets with US officials.29 |
| April 2, 2025 | “Liberation Day” universal 10% tariff + country-specific “reciprocal” tariffs announced.2 | Matches US tariff hikes; initiates new export controls on rare earths; adds US firms to entity lists.26 | Condemns tariffs; accelerates preparation of countermeasures.27 | Expresses concern; intensifies negotiations.28 | Imposes 25% tariffs on autos/parts.29 |
| April 9-12, 2025 | US tariff on China escalates to 145%.1 Pauses reciprocal tariffs on others for 90 days.27 | Tariff on US goods reaches 125%.26 | Approves €18B in countermeasures but agrees to 90-day pause to negotiate.27 | Continues negotiations for exemption.28 | Pauses some tariffs to support domestic industry.29 |
| May-June 2025 | Engages in talks with multiple partners. | Agrees to a temporary truce, suspending highest tariffs until Nov 10.30 | ECB cuts interest rates twice to cushion economic impact.25 | Negotiations intensify, focusing on auto tariffs and investment.31 | Launches domestic aid programs for businesses hurt by tariffs.29 |
| July 2025 | Reaches trade agreement with Japan.32 Extends EU negotiation deadline to Aug 1.34 | Maintains lower-level tariffs during truce. | Reaches agreement in principle with US ahead of deadline. | Secures 15% auto tariff in exchange for $550B investment commitment.33 | Faces new US threat of 35% tariffs.29 |
| August 1-7, 2025 | Implements new reciprocal tariff rates; Canada hiked to 35%.35 EU rate set at 15%.36 | China’s reciprocal tariff delayed until Nov 10.37 | Finalizes deal for 15% all-inclusive tariff ceiling.36 | Deal implementation begins; details remain contentious.32 | Carney condemns 35% tariff as “unjustified”.35 |
| Aug-Sep 2025 | Administration appeals court ruling on tariffs.22 De minimis exemption suspended.37 | Continues to diversify trade away from US.38 | Focuses on implementing the new trade deal and strategic diversification.27 | Works to finalize investment package details.31 | Lifts most retaliatory tariffs effective Sep 1 to preserve USMCA benefits.39 |
China’s response to the escalating U.S. tariffs was the most forceful and strategically sophisticated. Beijing moved beyond simple tit-for-tat tariffs to engage in asymmetric economic warfare, targeting U.S. vulnerabilities in critical technology supply chains and regulatory domains.30 In a rapid spiral following “Liberation Day,” China matched U.S. tariff hikes, culminating in a 125% retaliatory rate by April 12, 2025, a level designed to make U.S. exports “unmarketable”.1
More significantly, China weaponized its global dominance over critical minerals and rare earth elements. In February, it expanded export licensing requirements for materials like tungsten and indium.24 In April, it added new export controls for seven types of medium and heavy rare earth elements crucial for electronics, defense systems, and clean energy technologies.26 This was a direct strike at the heart of the U.S. high-tech and defense industrial base. Concurrently, China tactically deployed its “Unreliable Entity List,” adding a total of 29 U.S. companies by mid-April, primarily targeting firms in sensitive sectors like defense, aerospace, and biotechnology.24 This created significant uncertainty for U.S. corporations operating in or selling to China. Beijing also initiated multiple enforcement actions, including an antitrust investigation into a major U.S. technology company and antidumping investigations into U.S. optical fiber and medical equipment.26 Despite this aggressive posture, China also demonstrated strategic flexibility, engaging in negotiations that led to a temporary truce in May, which suspended the most extreme tariffs until November 10.1
China’s response was not merely reactive but a strategic demonstration of its own coercive economic capabilities. It used the trade war as an opportunity to “war-game” its asymmetric tools, signaling to the U.S. and the world that it could inflict precise, targeted pain on critical Western supply chains. The U.S. action was a blunt instrument—broad tariffs across all goods. China’s response was surgical. By restricting rare earth exports, China directly threatened the production of everything from smartphones to F-35 fighter jets, exposing a critical dependency that the U.S. could not easily or quickly mitigate. This was a long-term strategic signal: in any future conflict, Beijing could cripple key sectors of the U.S. economy and defense industrial base. This serves the goal of a competing Minimiser actor: to challenge U.S. hegemony not by direct military confrontation, but by revealing and exploiting systemic vulnerabilities, thereby eroding the perception of American economic invincibility.
The European Union, facing a 20% “reciprocal” tariff on top of reinstated 25% duties on steel and aluminum, responded with a multi-pronged strategy combining legal countermeasures, diplomatic pressure, and monetary policy adjustments, ultimately securing a negotiated settlement.25 The EU approved new countermeasures targeting €18 billion of U.S. goods and revived previous measures targeting €8 billion, hitting iconic American products like Harley-Davidson motorcycles, jeans, and peanut butter.27
However, the EU consistently prioritized a negotiated solution, suspending its countermeasures for 90 days to facilitate talks.27 This diplomatic track, combined with the economic pressure of the retaliatory tariffs, proved successful. It culminated in an agreement announced on August 1, 2025, that established a single, all-inclusive U.S. tariff ceiling of 15% for the vast majority of EU goods, including cars and auto parts.36 Internally, the European Central Bank (ECB) responded to the economic shock and heightened trade uncertainty by cutting its benchmark interest rate twice, on April 17 and June 5, 2025, to cushion the bloc’s economy.25 The crisis also spurred the EU to accelerate its efforts to diversify trade relationships, advancing partnerships with Mexico, Mercosur, and South Africa.27
The U.S. tariff shock acted as a powerful catalyst for European strategic autonomy. While the EU’s immediate goal was de-escalation, the crisis forced it to strengthen its internal defense mechanisms (such as its new Anti-Coercion Instrument) and accelerate its pivot away from over-reliance on the U.S. market.27 The Trump administration’s “NATO Gambit” and tariff war were designed to fracture the transatlantic alliance.2 While this succeeded in creating chaos, the shared external threat also compelled greater EU unity and coordination. The unreliability of the United States as a partner provided the political impetus for long-stalled EU initiatives aimed at building independent economic and geopolitical power. Therefore, the Minimiser attack, while damaging in the short term, had the third-order effect of strengthening the cohesion and resolve of a potential rival power bloc, contributing to the very fragmentation of the unipolar, U.S.-led order that the Minimisation Plan seeks to achieve.
Japan, a key U.S. security ally and a nation frequently singled out by President Trump for its trade surplus, pursued a strategy of direct, transactional negotiation to avoid the worst of the tariffs. This culminated in a deal that exchanged tariff relief for a massive, politically directed investment commitment.28 In an agreement reached in July 2025, the U.S. agreed to reduce the tariff on Japanese automobiles from a threatened 27.5% to a final rate of 15%.31
In exchange, Japan committed to a $550 billion investment package in the U.S. economy, targeting strategic sectors like semiconductors, AI, and automotive manufacturing.32 The terms of this investment were a source of public contention. President Trump asserted that the U.S. would retain 90% of the investment’s profits and that he could personally direct the funds as he saw fit. In contrast, Japanese officials described the package as consisting primarily of loans and guarantees from state-backed institutions like the Japanese Bank for International Cooperation.32 The deal also included provisions for Japan to increase its imports of U.S. rice and aircraft.31
The U.S.-Japan deal represents a successful application of coercive diplomacy to transform a security alliance into a transactional, tributary relationship. The traditional alliance was based on shared security interests and a rules-based trade system. The Trump administration replaced this with a stark threat: accept punitive tariffs or pay for an exemption.28 Japan chose to pay. The $550 billion investment package was not a standard foreign direct investment driven by market logic; it was a politically mandated transfer of capital to avert economic punishment. The public disagreement over the nature of the funds highlights the profound power imbalance in the negotiation. President Trump’s framing of the deal as personal money to be invested at his discretion reinforces the image of a vassal paying tribute to a lord. This outcome perfectly serves the Minimiser goal of “The Great Unravelling” by demonstrating that even the strongest U.S. alliances can be deconstructed and remade on purely extractive, transactional terms, eroding the “arborescent” world order built on mutual trust and respect.1
As the United States’ most deeply integrated trading partner, Canada faced an existential economic threat from the administration’s tariffs. After an initial phase of strong retaliation, Ottawa pivoted to a strategy of de-escalation, seeking to preserve the core benefits of the Canada-United States-Mexico Agreement (CUSMA) and mitigate further economic damage.
Initially, Canada responded forcefully, announcing 25% retaliatory tariffs on up to CA155billionofU.S.goods.[29]TheCanadiangovernmentalsolauncheddomesticsupportprograms,includingaCA6.5 billion Trade Impact Program, to help affected businesses weather the storm.29 However, this posture became untenable when the U.S. hiked its tariff rate on many Canadian goods to 35% on August 1, 2025.35 Faced with this escalation, Canada shifted its strategy. By September 1, 2025, the Canadian government announced it was removing most of its counter-tariffs. The official rationale was to recognize the U.S.’s decision to allow most Canadian goods to enter tariff-free under the USMCA/CUSMA framework.39 Retaliatory tariffs on key strategic sectors—steel, aluminum, and autos—remained in place as intensive negotiations continued.39
Canada’s de-escalation, while a pragmatic and likely necessary choice to avoid economic catastrophe, served as a powerful proof-of-concept for the administration’s coercive strategy. It demonstrated to other nations that resistance was costly and ultimately futile, while compliance, even if painful, offered a path back to a degree of normalcy. The U.S. imposed tariffs on Canada using the flimsy pretext of fentanyl trafficking, demonstrating the arbitrary nature of the threat.35 Canada’s economy, deeply intertwined with that of the U.S., could not sustain a prolonged trade war. By offering the USMCA framework as an “off-ramp,” the administration created a powerful incentive for Canada to back down. Canada’s decision to lift most of its tariffs was broadcast to the world. For other allies watching, the lesson was clear: forming a united front against the U.S. was unlikely to succeed, and the most rational path was to seek a separate, bilateral deal, even on unfavorable terms. This outcome fractures the potential for collective resistance and reinforces the hub-and-spoke model of coercive diplomacy the administration sought to impose, directly advancing the Minimiser goal of dismantling multilateral alliances.
The administration’s economic warfare campaign had immediate and significant consequences for the domestic economy, creating an uneven distribution of costs and benefits that exacerbated political tensions. Concurrently, the administration’s tariff strategy evolved in response to the public “TACO” narrative, shifting from a simple pattern of threat-and-reversal to a more complex and punitive model designed to reassert unpredictability as its primary strategic weapon.
The tariff war was not an abstract geopolitical exercise; it inflicted tangible and uneven damage across the U.S. economy. Economic models projected a decline in U.S. real wages by 1.4% and a fall in real GDP by approximately 1% by the year 2028 as a direct result of the tariffs.43 The impacts were not uniform, creating clear winners and losers across different sectors and regions.
Manufacturing was projected to see a temporary surge in employment due to protectionist measures, while the services and agriculture sectors were expected to decline due to retaliatory tariffs from trading partners and higher costs for imported inputs.43 This dynamic was particularly stark in the contrast between the steel industry and the higher education sector. While the administration’s policies were framed as protecting the fewer than 85,000 jobs in the steel industry, they simultaneously threatened the 3.1 million jobs in American higher education through restrictive immigration policies and funding constraints.44
The economic pain was also geographically concentrated. States with high trade exposure, such as California, Michigan, and Texas, were projected to suffer the largest real income losses. The state of California estimated that the tariffs could cost its households $25 billion and lead to the loss of over 64,000 jobs.19 More domestically-oriented states were expected to fare relatively better.43
This uneven distribution of economic pain and gain was a feature of the strategy, not a bug. It aligns perfectly with the Minimiser tactic of “manufactured justification,” which involves creating and amplifying societal fissures to present a manufactured crisis as evidence of a broken system.15 The administration’s public narrative focused exclusively on protecting a small, politically symbolic group (steelworkers) while dismissing the much larger losses in other sectors as the complaints of globalist elites or hostile institutions. This transformed a debate about economic policy into a culture war, deepening the political polarization the Minimisation Plan seeks to exploit and fueling the “hum” of illogical and disproportionate conflict.15
After the “TACO” meme went viral and the President was publicly confronted with it during a press briefing on May 28, a key question for analysts was whether the administration would alter its behavior to counter the narrative that it “always chickens out”.1 The tariff actions of August and September 2025 demonstrate a clear and deliberate recalibration of the strategy.
The August 1 deadline for reciprocal tariffs, which the President had previously insisted would not be extended, was pushed back to August 7 for most countries, suggesting a continuation of the delay tactic at the core of the TACO trade.1 However, the new tariff rates that were ultimately implemented on August 7 were not a universal de-escalation. While some countries that had negotiated deals were rewarded with lower rates (e.g., the EU and Japan), others were punished with rates higher than those originally threatened. Switzerland’s threatened rate of 31% was increased to 39%, and Canada’s rate was hiked from 25% to 35%.35 Furthermore, the administration introduced new punitive measures, such as a 40% “transshipment penalty” for goods routed through third countries to evade tariffs and the suspension of the
$800 de minimis exemption for small parcels, both of which took effect in August.35 New Section 232 national security investigations were also launched into additional sectors, including drones and polysilicon.16
| Country/Region | Threatened “Reciprocal” Tariff Rate (April 2025) | Final Implemented Tariff Rate (August 7, 2025) | Change | Key Negotiated Concession |
|---|---|---|---|---|
| European Union | 20% | 15% (Ceiling) | -5% | Agreement on 15% all-inclusive tariff ceiling.36 |
| Japan | 25% (Threatened) | 15% | -10% | $550B investment commitment.33 |
| Canada | 25% (Threatened) | 35% | +10% | Punished for perceived non-cooperation.35 |
| Switzerland | 31% | 39% | +8% | Punished for lack of deal.46 |
| Liechtenstein | 37% | 15% | -22% | Rewarded for reaching a deal.46 |
| Laos | N/A | 40% | N/A | Punished with one of the highest rates.35 |
| Most Others | 10% (Baseline) | 10% (Baseline) | No Change | No deal reached.37 |
The administration’s post-August strategy was a direct response to the “TACO” narrative. Stung by the public accusation of “chickening out,” the administration recalibrated its approach to be more punitive and less predictable. It abandoned the simple threat-reversal pattern in favor of a more complex model of selective punishment and reward, designed to reassert its dominance and prove that the TACO trade was no longer a safe bet. The August 7 implementation was no longer a simple “walk-back”; it was a strategic “re-sorting” where allies who capitulated were rewarded and those perceived as uncooperative were punished. This shift represents a direct, reactive feedback loop between a public narrative (the meme) and grand strategy. The goal was to kill the TACO trade by making the outcomes of tariff threats genuinely uncertain again, thus restoring the original strategic power of “weaponized unpredictability”.1
The events analyzed in this report, when viewed through the project’s core analytical frameworks, form a coherent strategic campaign that represents a significant acceleration of the Minimisation Plan.
When mapped onto the Psochic Hegemony, the entire TACO trade sequence is a quintessential “Greater Lie”.47 The public framing of the policy—the
Framed Vector—was one of tough negotiation for the “Greater Good” of American workers, characterized by a positive moral vector (υ≈+0.6) and a proactive volitional vector (ψ≈+0.8). However, the analysis of its actual effects reveals its True Intent Vector: the extractive and destructive act of shattering the global trade system for political gain. This places it firmly in the “Greater Lie” quadrant, defined by an extractive, negative moral vector (υ≈−0.7) and a proactive, destructive volitional vector (ψ≈+0.9). The large Euclidean distance between these two points yields a high “Contradiction Score,” providing a quantitative measure of the profound dishonesty at the core of the strategy.2
The strategy also perfectly matches the Helxis Tensor’s “Satan Archetype” deception model.47 The
Bait was the protection of American jobs. The Cover was the narrative of achieving “fair trade.” The True Intent, however, was to induce systemic chaos, shatter global supply chains, and accelerate the fragmentation of the global economic order.2
Finally, the vector of this strategy points unequivocally toward “Regression & Fall from Grace” on the Meter of Progress.47 Its downward moral trajectory (
−υ) and proactive, destructive will (+ψ) drive the system away from stability and toward the Minimiser objective of a global power vacuum. The events detailed in this report—the conditioning of markets to reward volatility, the deliberate provocation of a constitutional crisis with the judiciary, and the transactional fragmentation of key alliances—represent a significant and successful acceleration along this vector. The logical endpoint of this trajectory, as defined by the framework, is the “Nihilistic Singularity” at the center of the map (0,0). This singularity represents the most immoral act: the claim that there is no answer, the promotion of nihilism, and the total destruction of meaning and order itself.47 This endpoint, a world devoid of stable alliances, predictable economic rules, and the principle of objective truth in governance, remains the ultimate objective of the Minimisation Plan.
| Financial Market Volatility in the Spring of 2025 | St. Louis Fed, accessed September 4, 2025, https://www.stlouisfed.org/on-the-economy/2025/jun/financial-market-volatility-spring-2025 |
| How the ‘TACO’ Trade Could Undermine Investors’ Confidence | The …, accessed September 4, 2025, https://www.thewealthadvisor.com/article/how-taco-trade-could-undermine-investors-confidence |
| Democrats pen letter asking SEC to investigate Trump, allies for alleged market manipulation | CBC News, accessed September 4, 2025, https://www.cbc.ca/news/business/democrats-trump-sec-investigation-insider-trading-1.7507167 |
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