Katie Martin

I think the evidence for the fact that Europe does have some clout and does have some leverage here is that Scott Besson was extremely pissed off at this notion that European pensions could start selling down.

their treasuries.

You'll recall there was a note from Deutsche Bank not saying that Europe is going to sell all of its treasuries, but saying, huh, Europe owns an awful lot of treasuries.

Maybe it's not going to carry on accumulating treasuries at the pace that we've been used to for the past few decades in future.

You know, Scott Besson had a word with the chief executive of Deutsche Bank.

All of a sudden, they're distancing themselves from this analysis.

And it's very clear that the U.S.

administration is very sensitive to the idea that it could lose a pocket of very reliable buyers for the U.S.

treasury market, you know.

Stocks do what stocks do.

They're typically very flighty, but Scott Besson is very focused on keeping that 10-year US Treasury yield at or about 4%.

He does not want it to spiral higher.

He doesn't want higher borrowing costs either for the government or for anybody else.

It's not in the US's rational self-interest to scare off buyers of US treasuries.

So we've had a couple of quite small Nordic pension funds that have said, we've got out of our treasuries, not necessarily because of Greenland, but because of a bunch of other issues, debt sustainability, fiscal dynamics, the Fed.

you know, all of that stuff.

But it clearly leaves a mark.

You know, I don't think Europe is going to just one day, you know, press a button and sell all of its treasuries.

That would do us just as much harm as it would do the States.

It's not plausible.