Regional experts speculated that the Saudis may have backed into the $750 billion figure by including a wide array of assets, some of which may not be liquid. It may encompass investments with private equity firms, hedge funds, and ETFs, for example, as well as joint ventures with U.S. businesses.
The Saudis may also be counting assets held by their state-owned enterprises and the royal family at large. That could include U.S. real estate, said Simon Henderson, director of Gulf and energy policy at the Washington Institute for Near East Policy. In that case, the Saudi leadership would essentially have to convince wealthy citizens and royals to divest those assets.
Henderson cautioned that with little transparency into Saudi finances, analysts are operating in a gray area. But the development is nevertheless significant, because it suggests the Saudis are firing back at the White House's criticisms of the kingdom amid a deteriorating relationship between the long-time allies.
"It's a response to those public statements, and we're heading for a diplomatic train wreck," he said.
Saudi Arabia's Al-Jubeir said any sale of U.S. assets would be necessary in order to prevent them from being frozen during a lengthy court battle, according to the Times.
Ambassador Smith said that while the threat is likely empty, it could allow the Saudis an opportunity to kill two birds with one stone: address long-standing criticisms of its ultra-conservative, low-yielding investment policy, and allow the leadership to be seen standing up to the United States.
"I can see a scenario where they might sell off some of their Treasurys in order to fund a different investment strategy with a higher rate of return and, in the process, say that what they're doing is a punitive action against the United States," he said.
There are already signs of a shift. Deputy Crown Prince Mohammed Bin Salman told Bloomberg he aims to transform the kingdom's Public Investment Fund from a $100 billion stakeholder in domestic companies into a $2 trillion investment vehicle.