Davos Braces for Greenland Showdown After Trump Posts

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0:33President Trump doubles down on his plans to acquire Greenland ahead of expected meetings at the World Economic Forum in Davos. Even if a compromise is found on the Greenland issue, things will never be the same. A line has been crossed here because of Trump's willingness really to consider all options, including force, against the U.S.'s own allies. Plus, we take a look at why Trump's Greenland-inspired tariff salvo isn't fully rattling markets. And what time should you be waking up in the morning? It's not quite as straightforward as you think. It's Tuesday, January 20th. I'm Caitlin McCabe for The Wall Street Journal, and here's the AM edition of What's News, the top headlines and business stories moving your world today.

1:19President Trump has fired off a series of true social posts reiterating his plans for Greenland and telling reporters that the U.S. is the only country that can ensure peace. Well, I don't think they're going to push back too much. Look, we have to have it. They have to have this done. They can't protect it. The Post followed days of escalating tensions over the territory and with a subject set to take center stage as world leaders gather in Davos, Switzerland. There, the president has agreed to meet with Margreta, the secretary general of NATO, and other parties to discuss Greenland. Trump also shared a screenshot of what appeared to be a text message with French President Emmanuel Macron, which read, quote, We are totally in line on Syria.

2:01We can do great things on Iran. I do not understand what you are doing on Greenland. It comes after a French government spokesperson yesterday said the U.S. was crossing a new threshold of coercion. That punctuated a day of hectic diplomacy, with Danish and Greenlandic officials meeting with Ruta and the U.K. government. Here's Danish Foreign Minister Lars Luka Rasmussen. It's so important that all our allies in the NATO alliance and the European Union stand up for these principles to show the American president. You have a desire, you have a vision, you have a request, but you will never be able to achieve that by putting pressure on us.

2:44That signal is of crucial importance in order to, I would say, to push the Americans back into the meeting room as we agreed last week. For more, we're joined by Journal editor Marcus Walker. Marcus, you've been on the Greenland beat for a few days now. This is a fast developing story. Bring us up to speed on where we are this morning. Well, there has been a flurry of diplomacy both in public and in private between Trump and other White House officials and the European side. The Europeans are planning an emergency summit of European Union leaders on Thursday in Brussels. Before that, it's likely that Trump will meet some European leaders in Davos.

3:22Trump has said he will meet various parties without specifying whom at the World Economic Forum. After which, it remains completely unclear whether Trump will go ahead with his threat to impose tariffs on some European countries from the 1st of February, and whether it will escalate or whether some solution will be found in the meantime. It's clear from the communications in the last few hours or overnight that Trump is not backing down from his demand that the US should own Greenland and should take it over completely. Even though Trump said that he had a good conversation with NATO Secretary General Mark Ritter, he emphasized that he needs to own Greenland in his view.

3:57And at the same time, Trump has said further critical things about other European allies. He criticized the UK for giving away Chagos, even though Trump had previously approved that move. And he threatened France with 200 % tariffs on French wine and champagne unless Macron agrees to join Trump's board of peace for Gaza. So the tensions and the mixed messages are continuing. On the one hand, conversations are happening. On the other hand, he continues to take a very dim view of European allies and maintain his demand about Greenland. Marcus, you've got a great story out along with the journal's David Luno about the collapse of trust between European leaders and the U.S.

4:37and how that's now forcing Europe to reassess its reliance on Washington. Yes, indeed. So the Atlantic Alliance, NATO as the military core of that alliance, has always relied as much on trust and on a belief in common commitment as on its military infrastructure. And that part of it is what is really coming under fire and into increasing doubt because Trump has long been a skeptic about NATO and has made no secret about that. during the past year has not only stepped up the rhetoric against European allies in various ways, but in the clash over Greenland, he seems to be communicating that for the US, it's more important to control the Western hemisphere, including owning Greenland, and that if NATO is a casualty of that, then so be it.

5:22So the fear on the European side is that the commitment that's needed as the glue is simply no longer there. Even if a compromise is found on the Greenland issue, things will never be the same. A line has been crossed here because of Trump's willingness really to consider all options, including force against the U.S.'s own allies. That red line that you mentioned, Marcus, has serious consequences, right? We're talking about a dispute with NATO powers over trade, military force, and the norms that underpin transatlantic cooperation. Indeed, this Greenland issue has brought together both of the areas where the Trump administration and the Europeans have been in conflict.

5:59Security on the one hand and trade and tariffs on the other, with Trump threatening tariffs from the 1st of February and later escalating from June, unless he is allowed to buy and own Greenland. So we see these two fields of dispute coming together and calling the entire relationship into question. Now, for Europe, this poses a very awkward question of whether there really is a partnership with the US anymore, and if there isn't, whether Europe can actually afford to decouple from the US in both the economic sphere, because the US is an extremely important export market for Europe, and in the sphere of military security, because Europe would have to invest and rearm much, much more than it's currently planning to do if there is no military alliance with the US.

6:42So at the moment, Europe is at a point where the relationship is really teetering on the brink, but the prospect of a divorce looks horrendously expensive and costly to the Europeans. Of course, there would be costs for the United States too on both the economic front, And because the economic ties are deep in both directions and on the military front, because Europe also offers the U.S. bases that allow it to project power worldwide. And also, of course, NATO has been the foundation of U.S. influence in Europe and the wider region. Yeah, those economic ties run quite deep, Marcus. Can you just lay out for us what a potential trade war between the U.S.

7:19and Europe would look like? Well, if it comes to this, and the Europeans at least hope that it won't and that Trump will back down from his tariff threat, then this would be an economic break on both sides of the Atlantic. If Trump effectively tears up the trade agreement that he reached with the European Union last year by imposing further tariffs, that will take away the promised tariff reductions that Europe was about to ratify and is now suspended, thereby harming American businesses in Europe too. for European exporters to the US. But research does indeed show that tariffs are overwhelmingly paid by Americans.

7:55That is what the evidence shows. That is, tariffs are effectively a tax on American import businesses and consumers. Mostly, they're not money paid by foreign exporters to the United States. Rather, they are a tax on Americans. However, they also harm exporters from other countries because as the price of imported goods go up, so sales go down. And the evidence does show that tariffs, while being paid by Americans, also depress other countries' exports to the United States. But beyond that, the European Union also has this so-called bazooka known as the anti-coercion mechanism or instrument, which would be a whole load of further tariffs and restrictions on American businesses in Europe.

8:37That, however, would need active support from a majority of European countries, which currently is not there because most European governments still want to de-escalate this dispute with the U.S. that they don't want to raise the stakes even further. Certainly lots to watch in the coming days, Marcus. Thanks for the update. Thank you. Coming up, what does all this mean for financial markets? We dive into that. Plus, what time should you be waking up? We look at the latest sleep science after the break.

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9:40The restart of the trade war with Europe would present a renewed test of whether the global economy and markets can handle more disruption. This morning, stocks in Europe and Asia have sold off, and the prices for gold and silver have reached new highs. And we'll get even more direction when U.S. markets reopen after the holiday weekend. So we saw a chunky but not outrageous fall in stock futures yesterday, and we saw another chunky but not outrageous fall in stock futures overnight. But when you put those together, we're probably going to see a very large drop in US stocks this morning because the market was closed yesterday.

10:20That's Journal Senior Markets columnist James McIntosh, who says so far there could be a few reasons why investors are not putting a high probability on an extreme outcome between the US and Europe. One is that, you know, last year we had this major trade war. Stocks did really well. Volatility didn't really go up. The economy was fine. Corporate investment actually went up. These are things that are not what you'd expect from a major trade war. Of course, it's also possible that investors just think there's a decent chance that Trump is bluffing or that even if he's not bluffing, he doesn't have the power to push through with this.

10:57quite a lot of Congress is not supportive of the idea of taking Greenland and his tariffs might end up being ruled illegal and of course if they are then all this goes away at least temporarily and then of course one of the reasons that stocks did well last year is that Europe is planning to spend vast amounts of money on its military which is very very good for European defence stocks. I guess the worst case is that the U.S. actually invades. At the moment, that's not on the cards. President Trump says he wants to buy it. But if the U.S. started sending troops there, that would be an absolute sort of end of NATO moment.

11:38And, you know, investors would suddenly have to wake up and say, this is what we need to address. This is what we need to be thinking about. As James mentioned, investors will also be watching the U.S. Supreme Court today, which is expected to hand down opinions around 10 a.m. Eastern, including possibly on whether Trump's sweeping tariffs are in fact legal. An hour later, Anthropix CEO Dario Amadei speaks to Journal Editor-in-Chief Emma Tucker at Davos. And after the U.S. closing bell today, Netflix earnings, where the streamer may comment on reports that it plans to make its bid for Warner Brothers' discovery all cash.

12:18And finally, what is the optimal wake-up time to get the most out of your day? If you listen to social media, that would be 5 a.m. to keep up with all the high-flying CEOs and elite athletes. But if you want to boost productivity, waking up before sunrise might not be for you. A recent Gallup poll showed that more than half of Americans said they're sleep deprived, an increase from previous years. Journal family and tech columnist Julie Jargon says the ideal time to wake up really comes down to our genetic predisposition. In my research, I came across that people fit into typically three categories, lark, bear, or owl.

12:58And so those who wake up naturally early in the morning between, you know, 6 and 6.30 a.m. are considered the early birds or larks. That represents about 15 to 20 percent of the population. And then a small subset of those early birds are those who do naturally wake up at 5 a.m. The other 15 to 20 percent are night owls, people who, you know, like to sleep in. But the largest percentage comprise 55 to 65 percent of the population. Some sleep experts call them bears. We wake up sort of when the sun rises and go to bed earlier in the evening. And we feel that we're at our peak productivity wise between the hours of 10 a.m.

13:36and 2 p.m. Julie writes that morning sunlight, avoiding evening workouts, and limiting caffeine and alcohol before bed will also help you feel rested and ready to take on the day. But most importantly, stick to a regular wake-up time. So one of the key things is no matter what time you need to wake up in the morning, the goal is to be consistent about it. So, for example, if you do want to be on the 5 a.m. bandwagon, it's only going to work if you wake up at 5 a.m. on weekdays and weekends. because if you sleep in on the weekends, you end up feeling jet lagged. Follow the link in our show notes to Julie's story, where you can find a quiz which will help you determine if you're a lark, bear or owl.

14:16And that's it for What's News for this Tuesday morning. Today's show is produced by Daniel Bach and Hattie Moyer. Our supervising producer was Sondra Kilhoff. And I'm Caitlin McCabe for The Wall Street Journal. We'll be back tonight with a new show. Until then, thanks for listening.

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