Former President Donald Trump has warned of significant countermeasures should European nations liquidate US investments in retaliation for potential tariffs. This threat emerges concurrently with a Danish pension fund's decision to divest its entire portfolio of US Treasury bonds, citing concerns over US creditworthiness and long-term fiscal sustainability under Trump's policies. While speculation persists about a broader European sell-off of US assets, such a coordinated strategy faces practical hurdles due to private ownership structures, though large sovereign funds could potentially influence US capital markets.

Former President Donald Trump warned of "strong countermeasures" against European nations if they divest from US investments in reaction to his tariff threats. "If they do it, it's their decision. But they must understand that, if it happened, we would respond with significant measures," Trump stated this Thursday in a conversation with Fox Business during the World Economic Forum in Davos. "Furthermore, we hold a dominant position."

These statements from the president come as the Danish pension fund AkademikerPension plans to offload its entire portfolio of US Treasury bonds before the end of January, arguing credit risks linked to Trump's policies. "The United States, in essence, does not represent a reliable debtor and, in the long term, US government finances lack sustainability," said Anders Schelde, investment director of AkademikerPension. The fund, which manages around $25 billion in savings for teachers and academics, currently holds approximately $100 million in US Treasury bonds maturing at the end of 2025.

The Greenlandic pension fund SISA has also indicated it is evaluating whether to maintain its investments in US securities. Trump's now-abandoned previous threat to increase customs duties on goods from eight European countries, while seeking influence in Greenland, sparked speculation about the possibility of Europe liquidating trillions in US bonds and stocks as a response. However, implementing this strategy would likely involve difficulties. Most of these assets are held by private funds outside state control, although some major investors, such as Norway's sovereign wealth fund, could impact US capital markets with a coordinated large-scale sale. US Treasury Secretary Scott Bessent downplayed the Danish fund's planned sale earlier this week, commenting that he "was not concerned at all."