President Donald Trump's threat of new tariffs against eight NATO countries opposing his push to acquire Greenland roiled global markets. Asset manager Katie Koch thinks Trump can still soothe investor anxiety. The S & P 500 , Dow Jones Industrial Average and Nasdaq Composite suffered their biggest one-day declines on Tuesday since October following posts from Trump over the weekend. European equities fell on both Monday and Tuesday. What's more, U.S. Treasury yields rose across the curve, with the benchmark 10-year rate hitting its highest level since Aug. 22. That push higher in yields could lead Trump to ease his rhetoric around Greenland, according to Koch. "Yes, [Tuesday] was a 'Sell USA' day," Koch told CNBC's " Squawk Box " at the World Economic Forum in Davos, Switzerland. "Now, if that continues, … they will take an off-ramp, like they did previously." "U.S. voters care more about rates than arctic security," the money manager added. TCW manages more than $200 billion in assets. .SPX 5D mountain S & P 500 5-day chart But even if the White House finds a ladder to climb down, that may only temper short-term volatility. "Long term, I think we're going to see some quiet quitting of the U.S. bond market," she said. "Every asset owner that I'm talking to in Davos … they are looking to diversify away from the U.S." The move away from the U.S. is already under way in some markets. The dollar index, which tracks the U.S. currency's performance against six other major currencies, from the euro to the Japanese yen, is down more than 8% in the past year. On top of that, the gap between foreign gold reserves and foreign Treasury holdings has shrunk dramatically in less than a year.
