The Art of the Deal comes to Davos

In remarks at the World Economic Forum in Davos today, President Trump called for “immediate negotiations” over his latest hyperfixation—taking over Greenland—and said he won’t use the military to take over the territory.

“People thought I would use force. I don’t have to use force. I don’t want to use force. I won’t use force,” he promised the group of CEOs and political leaders.

Stocks immediately rebounded after those comments, which gave investors a sense of assurance that at least some diplomatic normalcy was still in place after the double-whammy of Nicolas Maduro’s ousting and the president’s heated rhetoric about Greenland.

Keeping Davos on its toes

Then, that normalcy was shattered by the president’s stunning announcement that he had reached an agreement with NATO Secretary-General Mark Rutte about the future of Greenland.

“We have formed the framework of a future deal with respect to Greenland and, in fact, the entire Arctic Region,” Trump posted on Truth Social this afternoon. “Based on this understanding, I will not be imposing the Tariffs that were scheduled to go into effect on February 1st.”

US stocks jumped even higher as investors breathed a sigh of relief that the threat of military conflict was temporarily quelled.

But it's still unclear what the details of that “framework” would be, or what long-term diplomatic damage has been done after this whole fiasco. Although the president declared he would back off of his recent threats of higher tariffs on European nations that resist the acquisition of Greenland, the European Union’s parliament had already decided to freeze a ratification vote of the previous trade deal it made with the US earlier this afternoon.

TACO traders are seeing green

How should investors approach today’s latest edition of market madness? One investment that’s consistently worked out over the past two years is betting that Trump chickens out, and today’s news is just the latest example of how anyone who buys the dip after the president promises global upheaval can make some serious profits when he backs down.

Then again, while gambling on the president’s whims has been a winning wager, making rash investment decisions based on the headlines isn’t the long-term path to profits. Instead, try to ignore the noise and find great stocks worth sticking with through thick and thin.—LB