January 21, 2026, Davos, Switzerland. U.S. President Donald Trump attended the Davos Forum again after several years and delivered a special address. Subsequently, following a meeting with NATO Secretary General Mark Rutte, Trump stated that he would temporarily not proceed with the planned tariffs on eight European countries that opposed the U.S. acquisition of Greenland, as originally scheduled. On the same day, a Yicai reporter visited the Davos office of UBS Group AG and interviewed Mark Haefele, Global Chief Investment Officer at UBS Global Wealth Management. During the Davos Forum, senior representatives of UBS often use this understated building to engage with investors and partners from around the world. Discussions surrounding the United States, Greenland, and other geopolitical situations have been ongoing throughout this year's Davos Forum. The previous day, Denmark's public investment institution, the "Academia Pension Fund," announced it would sell off $100 million worth of U.S. Treasury bonds by the end of the month, sparking considerable discussion both inside and outside the conference halls. In Haefele's view, this single event is not enough to shake the U.S. Treasury market, but it reflects a reality where global investors are starting to reassess their exposure to U.S. assets on the "margin." "In a sense, the United States may become a victim of its own success in the future," Haefele said.
A Speech and an Investment Decision The first context Haefele mentioned did not originate from financial markets, but from political narrative. During the Davos Forum, a speech by Canadian Prime Minister and former Governor of the Bank of England, Mark Carney, was repeatedly mentioned by many attendees. Carney stated bluntly in his speech that the old rules-based international order has ended, and the world is entering an era of great power competition. In this environment, medium-sized powers will struggle to cope with real-world challenges if they remain nostalgic for the past. "I think he articulated something many people are feeling but haven't fully articulated yet," Haefele commented. In his view, this assessment is not merely a political lament but is gradually being reflected in investment decisions. The move by the Danish investment institution is one manifestation of this sentiment at the asset allocation level. Although limited in scale, in the current highly sensitive market environment, any statement about "reducing holdings of U.S. Treasuries" is quickly amplified and interpreted. However, Haefele does not agree with labeling it a landmark event for "de-dollarization." He emphasized that such adjustments are happening more on the "margin" rather than representing a directional reversal. "The United States has attracted a massive amount of global capital to support its domestic economic growth and technology investments. This is a success in itself, but it also means that many investors' allocations to U.S. assets are already at historically high levels," he said. "In this context, reassessing exposure is a natural reaction."
The Reality of "No Alternative" During the interview, Haefele repeatedly mentioned one reality: at least for the foreseeable future, the U.S. Treasury market still lacks a genuine alternative. He pointed out that in terms of liquidity, market depth, and its core function as collateral for the global financial system, U.S. Treasuries remain in a unique position. This is why, even if some institutions choose to reduce their holdings, the U.S. Treasury market as a whole can maintain stable operation. "This is a market where long-term trends and short-term realities coexist," he said. "On one hand, some are indeed rethinking their allocations; but on the other hand, it's difficult to find a market that can fully replace U.S. Treasuries in terms of size, depth, and liquidity." It is within this dynamic balance that the trends of the U.S. dollar, gold, and commodities have gradually become outlets for investors to express uncertainty. Haefele does not believe the biggest risk this year stems from armed conflict in the direct sense. He is more concerned about the sustained impact on capital preferences after the prolongation of geopolitics. "The strong performance of gold and commodities in recent years, to some extent, reflects a process of capital gradually moving away from dollar assets," he said. This change is not abrupt but is closely related to policy uncertainty, the use of sanctions tools, and changes in the global security environment. In his view, these trends will not disappear quickly but are likely to persist for a considerable time.
AI Investment Divergence and Reassessment of Chinese Assets If geopolitics directly influences "where the money goes," then the discussion on Artificial Intelligence (AI) investment is more about "who gets the money." In the interview, Haefele clearly distinguished between two types of AI-related assets. One consists of large technology companies with stable free cash flow that can use their own profits to sustain AI capital expenditures; the other consists of companies that are not yet profitable and are highly dependent on external financing. "We do not believe large tech companies are in an AI bubble," he said. "They have cash flow and can afford the investments. But for those companies without profits, surviving on debt markets, the risks are clearly higher." Against this backdrop, a shift in attitude towards Chinese assets has also become a change he has observed recently. Haefele believes that China's economy is expected to achieve its set targets, and globally, some investors are reassessing their allocation ratios to the Chinese market. He specifically mentioned that renewed interest in China's tech sector is not driven by short-term sentiment but is more related to industrial structure and AI application pathways. "I often feel that China is more inclined to use AI to enhance manufacturing capabilities," he said. In contrast, a significant portion of U.S. AI capability is used in more consumer and entertainment-oriented scenarios. "This difference is something I would focus on." In his view, the trend of Chinese companies "going global" is also difficult to reverse. The decisive factor does not lie entirely in geopolitics itself, but in whether the products have sufficient competitiveness. "If the product itself is competitive, once it finds demand in overseas markets, it is almost very difficult to stop," Haefele said.
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