Prof G Markets – “Why Trump Wants Greenland”

Podcast: Prof G Markets
Host: Ed Elson
Date: January 8, 2026
Guest: Gracelyn Baskeran, Director of the Critical Mineral Security Program at the Center for Strategic and International Studies
Episode Theme: Analysis of President Trump’s revived interest in acquiring Greenland, the markets' reaction, and the geopolitical and economic stakes—particularly around critical minerals and global power.

Episode Overview

This episode dives deep into the breaking news of President Trump’s renewed push to acquire Greenland, not just diplomatically but with mentioned consideration of military force. Host Ed Elson is joined by expert Gracelyn Baskeran to unpack why Greenland matters geopolitically and economically—especially for critical minerals—and what it might mean for markets, global alliances, and the US's competition with China. The discussion also analyzes growing global anxiety about resource security and the much longer timeframes and challenges behind developing those resources.

Key Discussion Points & Insights

1. Market Response to Policy Volatility (01:23 – 03:00)

• Stocks & Sectors React:

  • The S&P 500 and Dow fell, while NASDAQ rose.
  • Homebuilding and Defense: Big drops (e.g., Blackstone -9%, Lockheed Martin -5%) due to Trump’s proposed bans on institutional single-family home purchases and defense company buybacks/dividends.
  • Bonds: Yield on 10-year Treasuries fell after labor numbers.

• Quote (Ed Elson):
  “Shares in homebuilders fell after President Trump said he’d ban institutional investors from buying single family homes... Trump had a busy day.” [01:31]

2. Why Greenland? - The Mineral Motivation (03:00 – 04:11)

• Resource Nationalism Drives Foreign Policy:

  • Gracelyn Baskeran likens US maneuvering to “a real-life Settlers of Catan.”
  • The quest for critical minerals (especially rare earths) underpins US foreign policy stances in Ukraine, DR Congo, Argentina, and now Greenland.
  • China dominates the processing of "heavy rare earths," essential for US defense and energy needs.

• Quote (Gracelyn Baskeran):
  "It feels a bit like we're playing a real life game of Settlers of Catan… minerals have featured in every one of those discussions.” [03:19]

3. Rare Earths in Greenland: Resource Detail (04:11 – 05:42)

• Rare Earths Reality:

  • 17 elements, not especially rare, but rarely found in concentratable quantities suitable for mining.
  • Vital in defense tech: “permanent magnets used in our missiles, lasers, tanks, fighter jets, submarines.”
  • China has 99% of worldwide processing for heavy rare earths.
  • Greenland holds two of the world’s richest deposits, particularly with heavy rare earths.

• Quote (Baskeran):
  "What we have in Greenland are two of the biggest rare earth deposits in the world, and they are particularly well endowed with those heavy rare earths.” [04:48]

4. Complicated Mining Prospects in Greenland (05:42 – 07:04)

• Mining Challenges:

  • Infrastructure: Greenland has fewer than 200 miles of road.
  • Energy: Mining is energy-intensive; Greenland has low population density and limited grid capacity.
  • Social License: Strong local resistance—past projects canceled due to public and political opposition.
  • Policy Volatility: Uranium, often co-located with rare earths, is controversial; policy swings impact feasibility.

• Quote:
  "Mining is not well loved in Greenland... social license to operate is actually very precarious globally, but particularly in Greenland.” [06:16]

5. Geopolitics and “Can You Just Take Greenland?” (07:04 – 09:21)

• Comparison to Venezuela:

  • Venezuela (oil) = mature extraction sector; Greenland (rare earths) = nascent, zero active extraction.
  • Typical mining project: 18–29 years from identification to production.
  • Hostility or threats of military force unlikely to succeed, both geopolitically and practically.

• Quote:
  "Mining is not an industry that I can go in tomorrow and have a shovel ready project three to six months from now.” [08:35]

  "I don't think it is a good way to go to Greenland... They really want to do it in a way that's collaborative.” [09:21]

6. The Geopolitical Chessboard: Security vs. Minerals (10:33 – 12:21)

• Strategic Location:

  • Greenland is geopolitically vital (US bases; proximity to Europe/Arctic).
  • China has recently shown increased interest—Denmark blocked a PRC move to control airports.
  • Immediate gain isn’t new minerals, but reducing reliance on China and countering its influence.

• Quote:
  "In the near term, I don’t think that there’s an illusion that Greenland is… suddenly going to reduce our reliance on China… It’s not a near term mineral solution.” [11:11]

7. How Could This Play Out? (12:21 – 12:56)

• Prediction:

  • European resistance is strong; “taking” Greenland is not viable.
  • Most likely scenario: push for “a more collaborative and more diplomatic approach,” expanding strategic partnership rather than confrontation.

• Quote:
  "Given the Europeans have made a very clear position… we can find a way to take a more collaborative and more diplomatic approach to Greenland.” [12:28]

8. Memorable Moments & Notable Quotes

• Game of Settlers of Catan Analogy:
  "We're playing a real-life game of Settlers of Catan." — Gracelyn Baskeran [03:19]

• On the Pace of Mining Development:
  “Average from the time that I identify a minerals deposit to extracting it is 18 years. In the US, it's actually 29 years." — Gracelyn Baskeran [08:27]

• On Social License to Mine:
  "Mining is not well loved in Greenland… social license to operate is actually very precarious, globally but particularly in Greenland." — Gracelyn Baskeran [06:16]

• The Two-Front Competition with China:
  "China actually had to be blocked from building the airports of Greenland… national security grounds." — Gracelyn Baskeran [11:11]

9. Listener Takeaway

• The US’s renewed focus on Greenland is about far more than geography or posturing: it is resource security—rare earths are central to next-generation defense and technology.
• Achieving resource independence will take decades and is beset by infrastructure, local politics, and shifting regulation.
• Military threats and confrontational approaches are unlikely to succeed; collaborative, mutually beneficial development is both desired by Greenland and more realistic for the US.
• Another layer: The “game” isn’t only about minerals, but also about keeping strategic rivals like China out of the Western Hemisphere’s sphere of influence.

Timestamps for Key Segments

• [01:23] - Market Reaction and Trump’s Announcements
• [03:00] - Why Trump is Focused on Greenland (Start of Guest Segment)
• [04:11] - Greenland’s Rare Earth Deposits
• [05:42] - Mining Challenges in Greenland
• [07:04] - Venezuela Comparison & Feasibility of “Taking” Greenland
• [09:21] - Collaborating Instead of Confronting
• [11:11] - Near-term Geopolitics vs. Long-term Resource Security
• [12:21] - Predictions on Next Steps with Greenland

Conclusion

This episode of Prof G Markets offers an incisive look at the intersection of markets, minerals, and modern geopolitics. The US's Greenland gambit highlights the complexity and time required to secure the supply of critical minerals in a world increasingly defined by resource competition with China. Any solution will demand alliances, patience, and a far keener appreciation for local and international politics than bullish campaign rhetoric may suggest.