A jarring comment from NATO secretary general, Mark Rutte, is doing the rounds this morning where it is said he did not discuss with Trump on whether Greenland would remain part of Denmark under a newly announced framework for a future deal. In other words, there was no proposal of the sovereignty of Greenland in talks with Trump.
And the situation is made worse than this supposed “framework deal” is one that is based on a short conversation between Rutte and Trump. Neither Denmark nor Greenland were consulted on the whole thing.
The deal that is being floated by the New York Times here pretty much covers most, if not all, of the things the US can already do with Greenland. And that is to keep military presence and invest in the resources of the island. So, what gives?
It’s certainly interesting to say the least. Rutte adds that he and Trump had a “productive discussion to ensure security in the Arctic region” while also saying that Russia and China will be prevented from having economic or military access to China. Is this really all just to put pen to paper and formalise the status quo? Hmm.
There is definitely still some uncertainty up in the air but perhaps the most important thing for the geopolitical climate and for markets is that Trump has turned it all into a show that he has stepped back. It definitely lowered the temperature in the room even if the overall landscape remains heated.
For now, markets are taking it as a TACO situation. That especially since Trump continues to reaffirm that the stock market is and always has been his number one benchmark in which he pins his presidential performance to. So, that’s providing much relief for equities and we’re seeing a light bounce continuing today after the strong rebound yesterday.
Make what you will of the situation above. This won’t be the last of it but given the fact Trump has said he will not take Greenland by force, that will at least brush aside much geopolitical concerns in the near-term.
And even Rutte was already looking to move on from all this drama as he says that Greenland shouldn’t be the priority right now, “our main adversary is Russia”. Geez.
In any case, tariffs and a show of force by the US is now being ruled out. So, that’s reason enough for markets to be happy and slowly put this in the rearview mirror.
This article was written by Justin Low at investinglive.com.