The breakdown of the relationship between Elon Musk and President Trump has raised many questions for investors.
In case you’ve been living under a rock, the relationship between the world’s wealthiest man, Elon Musk and the world’s most powerful man, President Donald Trump has imploded in spectacular fashion.
In the last five days…
- Musk criticized the President’s Big Beautiful Bill publicly, saying it would lead Americans to “debt slavery.”
- The President suggested that the U.S. government terminate contracts and subsidies with Musk’s companies.
- Musk advocate for the President to be impeached, thereby installing Vice President JD Vance as President.
- The President call Musk a “big time drug addict.”
- Musk retweet social media posts suggesting the President was a friend of Jeffrey Epstein
And more.
It is not unusual for wealthy, powerful people to get into feuds with other wealthy, powerful people. However, the speed and intensity of the collapse in relations between Musk and Trump is jaw-dropping, especially when you consider just how close the two were prior to this.
Musk openly endorsed Trump, campaigned with him, got him on the Joe Rogan podcast which allowed Trump access to millions of people who might not have listened to him seriously. Musk also spent tens of millions of dollars getting Trump elected. And most importantly, Musk connected the President to numerous Silicon Valley heavy hitters, allowing him (Trump) to get establishment backing from some of the deepest pockets and most connected insiders in the world.
In return, Trump made Musk one of his closest confidants and advisors, installed Musk as the head of the Department of Government Efficiency (DOGE), and gave him the proverbial keys to the entire bureaucracy, granting Musk access to data, power, and entities that few if any humans have ever had.
And somehow all of this went down the toilet in the span of a single week. And while Musk has expressed an interest in patching things up, the President has made it clear he wants nothing to do with Musk and has moved on.
This raises the question…was the friendship ever really genuine, or did Trump use Musk to get into office?
The reality is that in order to become President of the U.S. today, a candidate MUST have a relationship to big business, specifically Big Tech. Big Tech, more than any other segment of the economy holds the keys to power. It was Big Tech that hurt Trump the most during the 2020 election, deplatforming Trump and his supporters while suppressing stories that were damaging to the Biden candidacy.
In this context, the friendship with Musk gave Trump the opportunity to get into Big Tech’s graces. And boy did he. One of the most telling photos of the second Trump inauguration was the President being sworn into office while the CEOs of Google, Facebook, Amazon, and other big tech firms sitting in a row just a few feet behind him next to the President’s family and closest cabinet members.
Did Trump play these guys for suckers?
Put another way, was the friendship with Musk real… or was Musk used by Trump to get access to Big Tech, their checkbooks, and their support?
Time will tell. And depending on how this plays out, it could have a dramatic impact on the stock market.
The S&P 500 is HEAVILY weighted towards Tech. Not only is Tech most heavily weighted sector, but it is in more important than the 2nd and 3rd heaviest weighted sectors combined!
Big Tech (companies like Microsoft, Apple, Nvidia, etc.) accounts for almost 25% of the S&P 500’s weighting. These are the largest, most profitable companies in history. And to be blunt, it is VERY difficult for the stock market to rally without these companies participating.
So… if the Trump/ Elon feud spills over into the rest of Silicon Valley, it could very well decide how the rest of 2025 plays out as far as stock are concerned. The President was already on shaky ground with some of these companies (Apple, Amazon) due to the trade war/ tariff issues.
Having said that, while Big Tech might struggle there are truly spectacular opportunities in tech right, specifically in the AI space. While most of the world focuses on Nvidia, the biggest investment opportunities (and potentially the largest gains) are actually in off the beaten path, unique AI plays few if any investors know about.
On that note, we just published a new special investment report The AI Plays Your Broker Doesn’t Know About that details three unique investments designed to profit from the revolution in physical AI. Best of all, Wall Street has little to no idea these companies even exist, let alone their potential.
We are making just 99 copies available to the general public. To pick up yours…
Best Regards
Graham Summers, MBA
Chief Market Strategist
Phoenix Capital Research
