Trump targets European allies with fresh tariff threats again

U.S. President Donald Trump announced that from Feb. 1, 2026, Denmark, Norway, Sweden, France, Germany, the U.K., the Netherlands and Finland will face a 10% tariff on all goods entering the United States. 

The tariff is set to rise to 25% on June 1 unless a "complete and total purchase of Greenland" is agreed upon.

In a post on Truth Social on Jan. 18, Trump said the taxes would remain "until such time as a deal is reached," claiming the U.S. has "subsidized Denmark, the EU and others for many years."

"World peace is at stake!" Trump said. 

warning that "China and Russia want Greenland, and there is not a thing that Denmark can do about it." He added that only the U.S. "can play in this game" and described European visits to Greenland as "a very dangerous game."

Trump also referenced the so-called "Golden Dome" defense system, claiming it "can only work at its maximum potential and efficiency if this land is included in it."

Related: Analyst offers fix to Trump's $5.7B Greenland gambit

Market reacts to tariff threats

The announcement sent ripples through the market. CNBC host Jim Cramer suggested Trump may have acted prematurely, saying, 

"If I were Trump I would have waited to see if the Supreme Court backs him on tariffs. Could be very awkward if they don't." 

He warned that markets were "too overbought to bounce."

However, traders reacted positively in what some dubbed the "Inverse Cramer effect," where markets often move opposite to his forecasts.

Meanwhile, Bitcoin bull and former White House communications director Anthony Scaramucci  laid out five potential geopolitical risks if Trump's rhetoric escalates into action, including a fracturing of NATO, European realignment toward China, and a protracted Arctic insurgency. 

He warned that seizing Greenland could "legitimize Russian and Chinese territorial revisionism" and "damage American interests for decades."

"Hopefully Trump will be impeached and removed from office if he tries this. It is no longer a zero probability," Scaramucci added.

The Kobeissi Letter newsletter added that the next 48 hours are "critical" when European Union is expected to adopt an "aggressive, but open approach."

"President Trump ALWAYS leads with a punishing and threatening message, it's part of his negotiation tactic,"the newsletter added.

The team cited the October standoff with China, when a similar tactic resulted in a new trade agreement and Beijing lifting its restrictions on rare earth exports that Washington had criticized.

This time, the announcement's Saturday timing means markets will only reopen Monday night, giving investors time to absorb the news and potentially softening the initial selloff.