Musk has money, but Trump has power
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Elon Musk might have hundreds of billions of dollars and a social media megaphone, but President Trump's power over the levers of government may put Musk's business empire at much more immediate risk.
The big picture: Virtually everything Musk does has huge regulatory exposure, from cars to spaceflight to neural implants.
- In a government where norms are already out the window, it would take relatively little for Trump to bring the weight of regulatory burden to bear on Musk's enterprise.
What they're saying: "You just have to understand that if you own Tesla, it will be difficult to sleep at night as investors can scrutinize it from a fundamental standpoint, but also a headline standpoint," said David Wagner, head of equities and portfolio manager at Aptus Capital Advisors, in a commentary Friday.
Zoom out: Trump, thus far, has played the whole thing relatively cool, saying he doesn't really care if Elon turns on him.
- But he's also operating from a position of strength, as he clearly knows — thus, the threat on Truth Social to cancel all of Musk's government contracts. When YouGov polled more than 3,800 Americans on that question Thursday, those with an opinion supported ending Musk's contracts by a 2-1 margin.
- Friday morning, Trump had no hesitation about telling many of Washington's top political reporters he didn't care to speak to Musk — even amid reports Musk very much wanted to speak with him.
- He doubled down Saturday, telling NBC News Musk would face "very serious consequences" if he bankrolled Democrats running against Republicans who vote for the pending tax bill. (He declined to elaborate on what those consequences might be.)
How it works: There's a laundry list of ways Trump could squeeze Musk:
- Terminating contracts for space launches, Starlink Internet access and the like.
- Ending support for electric vehicle purchases, and the charging infrastructure to power those cars.
- More regulatory oversight of everything from Tesla's self-driving algorithms to Neuralink's implants.
- Further housecleaning of the loyalists seeded throughout the government, like the move to withdraw the NASA nominee who was a key Musk ally.
- The ultimate lever: Security clearances, a favorite Trump tool, and a question that has lingered around Musk for years.
What to watch: How Musk's public position evolves in the coming days, given how incendiary his comments were Thursday and how much Trump appreciates deference.
- "[T]he public spat was a bad look and seemed desperate in the moment and the stock reacted as such," Zacks Investment Management portfolio manager Brian Mulberry wrote in a note Friday.
The bottom line: The "first buddy" is about to find out how far friendship actually goes.
Editor's note: This story has been updated with comments by President Trump.
