Donald Trump’s decision to slap tariffs on countries that have shown support for Greenland is pushing transatlantic relations to a breaking point as EU leaders contemplate ways of retaliating against Washington that until now have been unthinkable.
One option being floated by centrist and left-wing politicians is for Europe to wheel out its Anti-Coercion Instrument, the EU’s so-called trade “bazooka” — a powerful retaliation tool that was originally conceived to fend off bullying from China, which would allow Europe to impose tariffs and investment limits against offending nations.
French President Emmanuel Macron has joined those calling for the instrument to be deployed against the U.S.
https://ticdata.treasury.gov/resource-center/data-chart-center/tic/Documents/slt_table5.html
Japan and China hold a boatload of US Treasuries, but European countries hold a bunch, too. If they dump them all at once, the market implodes, US interest rates spike, and we’re in a world of hurt.
Yes, those countries suffer a financial hit, too, but in the long run it might be cheaper than fighting a conventional war with the US over Greenland.