The tensions between Donald Trump and Elon Musk appear to be escalating. All started with some background noise. Trump is reportedly frustrated with Musk's growing political influence and refusal to fully endorse him. According to U.S. media reports, Trump has privately criticized Musk’s ambitions. In return, Musk has amplified posts mocking Trump and reiterated that X (formerly Twitter) will not be used as a campaign mouthpiece for any candidate.

Musk used the platform to criticize US debt levels and fiscal mismanagement, topics that intersect with Trump’s legacy and current campaign talking points. “Bankrupting America is NOT ok! KILL the BILL.” Musk posted on X last Wednesday. And added “If the massive deficit spending continues, there will only be money for interest payments and nothing else!”

Markets: Tesla stock slumped, losing 17% in two days, dragging down Nasdaq index yesterday - this morning with a shy rebound

My view: Frankly, I am not surprised to see Trump and Musk clashing. It is a confrontation I anticipated from the very beginning of their brief “collaboration” around the White House. Their egos, ambitions, and platforms were bound to collide.

I have been short Tesla since 20 May 2025, selling the stock at USD 353.63. A move I communicated to ETFMandate Premium Members via the Premium Newsletter.

Tesla’s fundamentals remain weak at this stage, and now political headwinds are intensifying. I am following this feud closely, as it could impact the stock sharply in either direction in the short term.

However, if tensions escalate further, the fallout could extend beyond Tesla, dragging down parts of the broader market, especially if Trump directly targets Musk-led businesses.

Markets continue to ignore the mounting debt challenges the US may face sooner or later, along with the growing warning signs. The latest USD 1.5 trillion spending plan only adds fuel to the fire. This complacency will not last forever. When the sentiment shifts, it could trigger a far deeper market correction.

This feud is more than just a personal spat. It has the potential to reshape also the political landscape. The next flashpoint? The unfolding battle over control of the social media narrative. What’s next in the battle between the Trump and Musk over the social media platforms? This story is far from over.

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06.06.25 - Trump vs. Musk

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