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A Clash of Titans: Trump and Musk’s Feud Ignites Reactions Across Business, Politics, and Markets

What started as a mutual admiration between former U.S. President Donald Trump and tech magnate Elon Musk has spiraled into a high-stakes public feud—one that’s sending shockwaves through Wall Street and Washington alike. With threats of canceled federal contracts, massive market losses, and political interventions, the escalating spat is more than a social media skirmish—it’s a headline-grabbing showdown with real-world consequences.

Trump’s Threats and Musk’s Provocations

The tensions flared after Trump criticized Musk’s vocal opposition to a Republican tax-cut and spending bill, calling it “disloyal and short-sighted.” In retaliation, Trump publicly threatened to revoke billions in federal contracts awarded to Musk's companies, including SpaceX and Tesla, citing national security concerns.

Musk didn’t hold back. The Tesla CEO responded on his platform, X (formerly Twitter), suggesting that Trump wouldn’t have won the 2016 election without his influence, particularly across the tech-savvy voter base. The online exchange triggered a cascade of reactions from political allies, tech investors, and market analysts.

Billionaire Voices Call for Peace

Notable billionaire and hedge fund manager Bill Ackman attempted to calm tensions, urging both men to “make peace for the benefit of the country.” Ackman, who endorsed Trump months before the November election, emphasized unity in a time of political division. Musk replied simply, “You’re not wrong.”

Mark Cuban jumped into the discussion, backing Musk’s suggestion of forming a new centrist political party representing the 80% of Americans who feel politically homeless. Andrew Yang even floated the idea of an “Independent ’28 Presidential Primary,” name-dropping potential candidates like Cuban, JPMorgan Chase CEO Jamie Dimon, and actor Matthew McConaughey.

Inside the Political Fallout

Congressman Jim Jordan, appearing on Fox News, expressed hope for reconciliation, while Steve Bannon, former White House chief strategist, called for aggressive measures against Musk. Bannon proposed using the Defense Production Act to nationalize SpaceX, suspend Musk’s security clearance, and investigate his political influence.

Congressman Thomas Massie offered a sharp take, writing on X: “You don’t land rockets backwards or get cars to drive themselves by suffering fools gladly,” hinting at the inevitable fallout between two powerful egos.

Meanwhile, Eurasia Group president Ian Bremmer remarked, “Trump is more powerful than Elon, but far less competent,” summing up the imbalance between influence and ability in this feud.

Wall Street Reacts: Tesla Shares in Freefall

The market response was immediate and brutal. Tesla stock dropped over 14%, erasing a staggering $152 billion from its market capitalization in just 48 hours.

Dan Ives, tech analyst at Wedbush Securities, described the clash as “a jaw-dropping event that rattled Tesla investors.” While Ives reaffirmed his long-term bullish stance on Tesla, he acknowledged that this feud could reshape the regulatory landscape, especially regarding autonomous vehicle approvals under a Trump administration.

Ross Gerber, CEO of Gerber Kawasaki, voiced concerns that Musk is “attacking the very people he helped empower.” He warned that such erratic behavior might alienate both investors and policymakers, potentially costing Tesla crucial government support.

Gary Black of the Future Fund, which recently divested from Tesla, argued the rift "destroys any chance of regulatory fast-tracking for Tesla’s autonomous ambitions." He predicted continued stock pressure as confidence in Musk's political alliances dwindles.

SpaceX’s Strategic Value—and Political Risks

Beyond Tesla, experts are raising red flags about the potential impact on SpaceX, Musk’s space technology firm responsible for nearly 70% of U.S. government satellite launches. David Rosenberg, founder of Rosenberg Research, noted that any disruption in SpaceX’s role could set the U.S. back in its technological lead.

“There’s growing discomfort among Republicans about Musk’s political moves,” Rosenberg said. “If he continues to criticize spending bills and challenge establishment figures, SpaceX might find itself entangled in the same web Tesla now faces.”

Looking Ahead: Fallout or Reconciliation?

While the Musk-Trump fallout might seem like a personal vendetta, the implications are anything but. With billions in contracts at stake, investor trust on the line, and political dynamics shifting rapidly, this feud could shape the future of U.S. tech, space exploration, and market regulation.

Whether the two titans reconcile or go their separate ways, the ripple effects will be felt across boardrooms and ballots—and shareholders are watching every move.