Tesla, Musk, and the Politics of Power

Unfortunately, Tesla’s market cap just dropped by more than $150 billion in a single day because of the "Musk Trump Break-up". I guess that’s what happens when investors realize that government contracts and political proximity are not guaranteed commodities.

I generated this image using AI

Some people act as if this was a surprise, but it's always risky to price any company based on someone’s access to the White House.

Well, Chinese EV company BYD benefited from this.

Classic story, Tesla loses ground, the market reallocates attention and capital and competitors fill that vacuum. It's definitely a predictable turn of event, but watching it in real time still looks painful, at least to me. Same goes for OpenAI and Blue Origin, when one player stumbles the others are given new opportunities.

There’s a cold mathematical logic to it but it’s also kind of brutal.

Some people will insist Musk’s personal wealth still insulates him, and yeah there’s truth there, but the idea that private relationships with power can be an enduring asset has clearly shown its limits in this instance. The repricing of Musk’s empire isn’t just a single day’s stock price, it’s a whole "recalibration" of what counts as value when political ties start to look like a toxic relationship.

Posted Using INLEO