Trump's classic negotiating technique has reappeared, NATO allies have collectively panicked, US stocks have plummeted, and the Davos summit has become the focus

Just a year into his second term, Trump has once again put Greenland on the cusp of a trend. From a "buy island" joke to a tariff stick, he named eight NATO allies, and threats of 10% in February and 25% in June have made Europe collectively nervous.

The hard-core argument for the strategic choke point of the Arctic, the "Golden Dome" missile defence and mineral resources, and the soft words "I believe we can find a solution that satisfies both Nato and us". The Icelandic game has pushed the transatlantic alliance to the brink: capitulate, or take it hard? The answer may lie at the upcoming Davos meeting.

Trump's classic negotiating technique reappears: bold offer, tariff threat, waiting for opponents to bow down

For months, European leaders have responded to US President Donald Trump's vehemently expressed intention to buy Greenland with a firm but succinct "not for sale". However, this firm stance quickly took a dramatic turn after Trump's threat of high tariffs.

European leaders have scrambled to arrange an emergency meeting with Mr. Trump to negotiate the future of the giant Arctic island. The abrupt turn of events is typical of Mr. Trump's usual negotiating strategy of making an extremely bold, even shocking, demand. If the other side refuses to meet it, it will immediately use economic pressure and even military threats, and then patiently wait for the opponent to gradually compromise under pressure. This tactic of "maximum pressure" has become the core of Trump's handling of international affairs.

Trump's words "wait and see" also revealed signs of reconciliation

At a White House press conference on Tuesday (January 20), when pressed by reporters on how much Mr. Trump was willing to pay to get Greenland, he responded mysteriously and confidently: "You'll find out." This ambiguity left room for further escalation without ruling out the possibility of more aggressive action. However, Trump also occasionally expressed a more peaceful posture on the same occasion.

Speaking at the White House, he said: "I believe we can find a solution that is very satisfactory to Nato and to ourselves."

The twin signals reflect the caution of some advisers within Mr. Trump's team who want to reach some sort of compromise with Denmark, which controls the roughly 800,000-square-mile island, while easing the growing tensions with European leaders.

This is not the first time Trump has used economic weapons to force allies into submission

Indeed, Mr. Trump's frequent use of economic pressure to force adversaries back to the negotiating table has long been a central part of his trade policy agenda. In posts on his Truth Social platform and in public speeches, Mr. Trump has repeatedly warned allies and adversaries of devastating tariffs if they do not comply with US demands.

The hardline stance has succeeded in prompting a series of emergency talks with Washington to reduce or avoid steep tariffs, while Mr. Trump's longstanding criticism of Nato and threats to undermine the transatlantic alliance have forced members to sharply increase defence spending in return for continued US security commitments.

The advisory team urgently called for calm to avoid a full-blown trade war

Faced with the grim situation of possible retaliatory tariffs by European countries, some of Mr. Trump's core advisers, including Scott Bessant, the US Treasury secretary, have publicly called for calm this week.

Speaking on the sidelines of the World Economic Forum in Davos, Switzerland, Mr. Bescent made clear on Tuesday: "Please remain calm, take a deep breath and do not retaliate. The president will be here tomorrow and he will clearly communicate his position."

The advisers' remarks are designed to buy more time for Trump's hardline tactics while preventing the situation from escalating into a highly damaging all-out trade war.

The threat of tariffs triggered a global market shock, with U.S. stocks posting their worst one-day performance since October last year

Mr. Trump's threat to tighten his grip on Greenland led directly to a sharp sell-off in US stocks on Tuesday, with the Dow plunging 871 points, or 1.8 per cent, its worst one-day performance since October.

At the same time, the dollar weakened, recording its biggest one-day decline in more than a month and hitting a new low in more than two weeks. US Treasury yields rose significantly, and the 10-year yield hit its highest level since August last year. Mr. Trump is known to be extremely sensitive to market reactions to policy moves, having temporarily suspended plans to impose tariffs after the market rout in April last year.

Kush Desai, White House spokesperson, was upbeat about market confidence, stressing: "Accelerating GDP growth, cooling inflation, and more than a dozen historic trade deals are evidence that this administration continues to deliver results for American workers and businesses."

The Davos summit has become the focus, and Trump is about to face off with leaders of many countries

Trump is scheduled to arrive in Davos early on Wednesday for a series of meetings with world leaders, with Greenland expected to be one of the central issues at the meeting.

There are no immediate plans for Denmark to attend these meetings, according to Danish officials. Mr. Trump's keen interest in Greenland, which dates back to his first term as president, has had its ups and downs but never really faded. Until late last year, Danish officials were under the illusion that Mr. Trump's acquisition intentions had been shelved.

However, when Trump suddenly appointed Jeff Landry, the governor of Louisiana, as special envoy for Greenland, and declared on social media that Landry "deeply understands the importance of Greenland to US national security", the move completely upset Denmark's calculus.

The European unity countermeasure is counterproductive, and Trump directly resorts to the 10% tariff stick

Weeks later, senior officials from Greenland and Denmark held discussions with Vice President JD Vance and Secretary of State Marco Rubio, but there was little agreement on the way forward.

European officials had expected that public displays of solidarity would prevent further escalation, but this strategy has had the opposite effect.

Last week, a small group of military and diplomatic personnel from France, Germany, Norway, Sweden, the Netherlands, Finland, and the United Kingdom were dispatched to Greenland to show their support for Denmark and demonstrate their commitment to maintaining the security of the Arctic islands.

But according to people close to Trump, Trump saw this as a direct provocation to his acquisition intentions, and on Saturday (January 17) quickly announced retaliatory measures: imposing 10% tariffs on these countries since February and threatening to raise the rate to 25% in June.

Trump advisor is confident: The president is best at "The Art of Doing Business"

Kevin Hassett, director of the National Economic Council, believes that Trump's tariff threats are just part of his negotiating strategy, and he is confident that the president will eventually reach a deal that benefits both the United States and its allies.

In an interview with Fox News on Sunday (January 18), Hassett said: "When you negotiate with any country and with President Trump, you see very tough and extreme positions on both sides, but after all, the president is the author of'The Art of Doing Business' because he is very good at making deals." He further called on all parties to calm down, put aside heated rhetoric and return to the negotiating table for a win-win solution.

Trump's Strategic Considerations: Arctic Dominance, Missile Defense, and Mineral Resources

Mr. Trump is expected to detail his economic agenda, housing policy and the past year's record in a speech in Davos, and he will also focus on his national security goals of mastering the western hemisphere, according to senior administration officials.

Trump has repeatedly stressed that taking Greenland is a key move to prevent China and Russia from taking control of the strategic Arctic region, and that the island is irreplaceable in advancing his "Golden Dome" missile defense plan.

Moreover, Mr. Trump's advisers have delved into the vast potential of developing Greenland's rich mineral resources, and on a personal level, Mr. Trump even confessed to the Norwegian prime minister that one of the reasons he is so obsessed with Greenland is his failure to win the Nobel Peace Prize.

A year into his second term, Trump is still going his own way, and few dare to challenge his instincts

A year into his second term, Mr. Trump's decision-making style remains largely unchecked, and his advisers rarely publicly question his gut instincts. In a nearly two-hour White House press conference on Tuesday, he even joked that the Gulf of Mexico should have been renamed after him, then clarified that it was a joke and humorously said that headlines such as "staff rejects presidential whims" could be expected. When he looked at Carolyn Levitt, the White House press secretary, and said: "People around me don't refute me very much," the other party smiled knowingly. In a scene that vividly demonstrated Trump's absolute authority in the White House.

Mr. Trump's Greenland offensive is not just a game of geopolitics. It is the ultimate embodiment of his "America First" philosophy. It remains to be seen whether Europe can hold the line and the Nato alliance can withstand this unprecedented test in the global spotlight contest in Davos. This thrilling game of great powers over an icy island is pushing the entire Western world to an unknown crossroads.