March 24, 2026
The global markets caught a fleeting breath of relief this Monday after President Trump took to Truth Social to claim “productive” talks with Tehran, momentarily pausing planned strikes on Iranian energy infrastructure. The news sent oil prices tumbling and stocks ticking upward, as investors scrambled to price in a potential “TACO trade”—the “Trump Always Chickens Out” strategy that defined his previous trade war maneuvers.
However, as the dust settles, market analysts and geopolitical experts are warning that a social media post cannot easily dismantle the machinery of a hot war.
The Allure of the TACO Trade
The term TACO trade originated during the 2025 trade wars with China. It describes a predictable pattern: Trump issues a massive threat, markets hit a “pain point” (such as the 10-year Treasury yield spiking), and Trump subsequently pivots to negotiations to soothe the volatility.
While The Kobeissi Letter noted that the current rhetoric follows this familiar playbook, they warned that “market normalization after this historic shock will take months,” regardless of the President’s tweets.
Why This Time is Different
Unlike a tariff dispute, the conflict involving the U.S., Israel, and Iran involves physical destruction and rigid geopolitical stances that are harder to “tweet away.” Experts point to three primary hurdles:
- A Two-Way Street: Shortly after Trump’s post, Iranian state media and Parliament Speaker Mohammad Bagher Ghalibaf issued flat denials, labeling the claim “fake news” intended to manipulate markets.
- Irreversible Damage: Joseph Brusuelas, chief economist at RSM, noted that even a peace deal won’t immediately lower costs. “The tap of oil and refined products will not just be turned back on,” he cautioned, citing Qatar’s warning that 20% of its LNG production could remain offline for years due to Iranian strikes.
- The Israel Factor: Investing legend Mohamed El-Erian argued that Trump cannot simply “impose his will” on the other warring parties—Iran and Israel—at this advanced stage of the conflict.
The “Fake News” Volatility
The discrepancy between U.S. and Iranian claims has created a dangerous environment for investors. Former JPMorgan quant lead Marko Kolanovic described the situation as a “net negative,” suggesting that such “manipulation” causes market liquidity to evaporate while the underlying structural problems remain.
Kolanovic advises investors to ignore the rhetoric and watch the physical reality of the Strait of Hormuz. If oil isn’t moving through that narrow chokepoint, the downward trend in oil prices seen on Monday is likely a “mirage” rather than a sustainable recovery.
Summary of Market Impact
| Asset | Monday Reaction | Expert Outlook |
| Brent Crude | Dropped from $116 to near $96 | Likely to remain higher than pre-war levels |
| Equities | Short-term rally | High volatility expected until a formal treaty |
| Treasury Yields | Slight cooling | Vulnerable to “liquidity disappearance” |
