Europe can wield this $8 trillion ‘sell America’ weapon as Trump reignites a trade war over his Greenland conquest ambitions
Jason Ma
By Jason Ma
Weekend Editor
“European countries own $8 trillion of US bonds and equities, almost twice as much as the rest of the
world combined,” Saravelos pointed out. “In an environment where the geoeconomic stability of the western alliance is being disrupted existentially, it is not clear why Europeans would be as willing to play this part.”
As Trump threatened to upend global trade and finance last year, Danish pension funds led the charge in reducing their dollar exposure and repatriating money back home, he said.
Such moves represented the “sell America” trade that saw investors dump dollar-denominated assets amid doubts that they would continue serving as safe havens or still deliver attractive returns.
“With USD exposure still very elevated across Europe, developments over the last few days have potential to further encourage dollar rebalancing,” Saravelos added.