President Donald Trump has warned of “major reprisals” if European countries attempt to pressure Washington by dumping their holdings of US Treasury bonds, amid renewed tensions over the future of Greenland.
Speaking on Fox Business Network’s Mornings with Maria on Thursday, Trump said the United States would respond forcefully to any such move. “If that would happen, there would be a big retaliation on our part, and we have all the cards,” he said, while acknowledging that European nations hold significant amounts of US government debt.
The remarks come against the backdrop of a diplomatic standoff over Greenland, the autonomous Danish territory that Trump has repeatedly expressed interest in acquiring. The US president has argued that Washington deserves control of Greenland, claiming the United States would be compelled to defend the strategically located island from potential threats posed by Russia or China — despite neither country asserting any claim to the territory.
In recent weeks, Trump’s threats to impose tariffs on European countries for refusing to support his Greenland proposal unsettled global markets. However, at the World Economic Forum in Davos, Switzerland, on Wednesday, Trump softened his stance, saying he would not use force to take Greenland and lifting the threat of sanctions against European nations.
Despite the de-escalation, analysts note that Europe retains considerable economic leverage. European NATO members collectively hold more than $2 trillion in US Treasury securities, a figure that rises to about $3 trillion when Canada is included, according to US government data.
Fueling speculation, Swedish pension fund Alecta disclosed on Wednesday that it sold most of its US Treasury holdings over the past year, citing the unpredictability of the current US administration and rising government debt. Earlier, Danish fund Akademiker Pension announced a similar move.
The Danish fund, however, insisted its decision was unrelated to the Greenland dispute, pointing instead to concerns over the state of US public finances.
US Treasury Secretary Scott Bessent has dismissed claims that European investors are targeting US debt in retaliation for Washington’s Greenland ambitions, insisting there is no coordinated effort against American securities.
While immediate tensions appear to have eased, Trump’s warning underscores the fragile balance between geopolitics and global finance — and how quickly disputes can spill into the bond markets.
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