Worlds' richest man vs. US President was the drama we didn’t know we needed
When two people fall out, it can be unpleasant, vicious even, but outside of financial disputes it’s not usually costly.
But when the president of the United States and the world’s richest man fall out, very publicly, it can mean a huge financial loss, as we found out this week in a drama that ignited like a wildfire and very quickly seemed out of control.
Elon Musk and Donald Trump, taking to their respective social media platforms, exchanged blows that included Musk calling for the president’s impeachment and Trump threatened to end government contracts for SpaceX and Tesla.
Tesla shares suffered their worst fall in the company’s history, down 14% to $284.70 and wiping $150 billion of the firm’s market value, shocking investors in the EV maker who were collateral damage in a bitter battle.
Musk’s personal fortune dropped $34 billion Thursday and even when you have a $334 billion fortune, losing that kind of money is painful, especially when just a few months back your net worth was $500 billion. Musk eased back on his allegations against the president, which includes suggesting he is named in documents relating to disgraced financier Jeffrey Epstein.
Earlier in the week, Musk tore into the president’s signature tax bill calling it a “disgusting abomination.”
The spat brought comment from many, including veteran fund manager Bill Ackman, founder of Pershing Square Capital Management, who posted on social media: “I support @realDonaldTrump and @elonmusk and they should make peace for the benefit of our great country. We are much stronger together than apart.” Musk replied: “You’re not wrong.”
It’s understood that Trump and Musk will speak Friday to try to clear the air and as of 5am ET Friday, US stock futures are up slightly on optimism that the dispute will be concluded. The three main indexes all closed lower Thursday led by a 0.83% decline for the Nasdaq while the S&P 500 (-0.53%) and Dow Jones (-25%) saw smaller losses.
“Futures are edging higher, perhaps as Musk has started to suggest on X that he would be open to a cooling-off period in his war of words with the President,” Jim Reid, global head of macro research and thematic strategy at Deutsche Bank, commented.
