EU readies €93B tariffs in retaliation for Trump's Greenland threat

They're devastating for the less diversified side.

The EU just signed a giant trade deal with Mercosur, creating the world's largest free market.

Tariffs are devastating for the smaller market and highly dependent on whether you can sell the stuff that is tariffed elsewhere in the world and whether the other side can buy the stuff that is getting tariffed elsewhere in the world. The stuff the US gets from Europe is pretty specialized and given the US tendency to continuously isolating itself while others are making trade deals, the others could just decide to do world economy without the US at some point.

If the US didn't had the singular role of the USD it would have been in dire trouble a while ago. Now the incentives for keeping the USD are getting less and less.

If Trump was an agent to hurt the US position in the world, he wouldn't do anything differently.

You must be thinking of 2008. And the EU economy was not bigger than the US back then. There was a temporary distortion in currency exchange rates, as people saw a significant risk that the financial crisis would cause serious long-term damage to the US economy. It didn't, the exchange rates normalized, and the illusion that the EU economy was bigger vanished.

Currencies are speculative instruments, not reliable measures. If you measure the economy of one entity in the currency of another entity, you should never accept the numbers at face value.

And then USA will impose total blackout on services to EU for 1 week and we will lose 200B in productivity.

Right now EU is just in the bent over position and waiting to be fucked. By everyone. And Brussels don't have the vaguest idea how to get out of it.

Assuming that still does not lead to impeachment and conviction that's on the US, and I'm pretty sure that the EU will stand united against such pressure. The temperature in the room has changed considerably in the last 90 days.