Could Europe start cutting its exposure to U.S. assets in response to Trump’s tariff threats?

According to Bloomberg, analysts warn that escalating trade pressure from Donald Trump—including tariffs tied to disputes over Greenland—may push the EU to reconsider its massive holdings of U.S. securities. Europe currently owns about $8 trillion in U.S. stocks and bonds, making it Washington’s largest creditor. Deutsche Bank strategist George Saravelos argues that in a world of rising geopolitical friction, capital flows—not trade—could become the main weapon. Any meaningful European rebalancing away from U.S. assets could weaken the dollar, support the euro, and trigger volatility across global markets.