Danish pension fund divesting US Treasuries

Scale and Meaning of the Danish Move

• The fund is selling its entire US Treasury position (~$100m), tiny versus ~$8–9T foreign-held Treasuries, so direct market impact is minimal.
• Many see it as important symbolism: first visible “bow shot” from an allied institution; these decisions can be self-reinforcing as others reassess exposure.
• Others stress this is not “virtue signaling” but standard de‑risking: a liquidity sleeve is being moved away from what is now viewed as a less predictable creditor.

US Dollar, Reserve Status, and Alternatives

• Several comments note the USD share of global reserves has been slowly declining, with no single successor; more likely a basket (USD, EUR, CNY, others) and greater diversification.
• Some argue “reserve currency” is an outdated concept under floating FX; the dollar is mainly a low-friction routing currency that will lose share once it’s no longer cheapest.
• Others think a true USD collapse would mean global chaos because export economies (EU, China, Japan) are structurally tied to a strong dollar.

Debt, Inflation, and Default Risk

• Participants highlight US deficits, growing interest costs, and the political unwillingness to cut spending or raise taxes.
• Strong debate over whether “printing to pay” is functionally a default: one side calls inflation a stealth haircut; the other insists legal default is different from breaking an inflation target—but markets will price both as risk.
• Japan’s experience is cited as a possible “slow heat death” model rather than hyperinflation.

Greenland, NATO, and Credibility

• A major theme: the divestment is less about the debt ceiling and more about geopolitical risk—especially threats to annex Greenland and use tariffs as weapons against allies.
• Many argue US soft power and trust—core to dollar and Treasury safety—are being actively destroyed by threatening invasions, attacking NATO cohesion, and politicizing the Fed.
• Concern that allies are now openly planning joint sanctions/tariffs against the US, and that US bases and force projection could be curtailed if Europe stops seeing America as a benign hegemon.

Shifts Toward China and Multi‑Polar Finance

• Moves by European leaders to seek more Chinese investment, and Canada’s openness to Chinese EVs, are seen as part of a broader slide away from US-centric integration.
• Some welcome a more multipolar, balanced-trade system; others warn Europe is trading dependence on an unreliable US for exposure to an authoritarian China with its own ambitions.

Hedging: Gold, Crypto, and Ex‑US Exposure

• Several commenters report rotating portfolios away from US assets or Treasuries into ex‑US equities, gold, and (for some) crypto, framing it as protection against US political and fiscal risk rather than a short-term trade.