What’s Behind Elon Musk’s Bromance with Donald Trump


For much of President Biden’s time in the White House, his relations with Elon Musk have been tense. They may be about to plunge to a new low after Biden’s re-election campaign hit out at reports that Donald Trump could make Musk an adviser if the Republican were to win in November.

The president’s campaign sees mileage in targeting Trump’s ties to moguls. Despite what Donald Trump thinks, America is not for sale to billionaires, oil and gas executives, or even Elon Musk,” James Singer, a spokesman for the campaign, told DealBook, in its first comments on Musk.

What we know about the Musk and Trump’s warming ties, according to The Wall Street Journal:

  • The two talk often: Musk and Trump speak on the phone several times a month.

  • The relationship is about influence rather than money: Musk doesn’t simply want to write a check for Trump’s campaign; he’s offered to use his sway with business leaders to help fight Biden’s re-election bid. Musk co-hosted a dinner at the Los Angeles home of the investor David Sacks last month that included Peter Thiel, Steven Mnuchin and Rupert Murdoch.

  • Nelson Peltz has played a central role. Musk and Trump met in March at the billionaire investor’s Palm Beach, Fla., estate, where the advisory role discussions took place. Peltz and Musk have also briefed Trump on a plan to invest in a project to prevent the possibility of voter fraud.

Musk hasn’t commented on The Journal report. In an interview earlier this year with Don Lemon, he downplayed the meeting. “Let’s just say he did most of the talking,” he said.

Musk voted for Biden in 2020 but has turned to the right. He has increasingly used X, his social media platform, to berate the president on migration and health care policies, and has criticized diversity, equity and inclusion programs that the political left has embraced. Musk was also miffed that the White House didn’t invite Tesla to an electric vehicle event in 2021.

Biden has seemingly been keen to fuel the feud. The president has had a habit of dismissing Musk’s views, a tactic that could backfire. As Andrew has pointed out, whether you like him or not, Musk is a natural ally on issues like tackling climate change. The Biden campaign’s latest comments suggest that it sees political mileages in distancing itself from the billionaire class (its pitching hard for working-class votes in battleground states.)

For Trump, Musk’s backing would be the latest billionaire to come to his side. Musk has indicated that he’s not ready to endorse a candidate and has said he won’t donate to either of them. But reports of their warming ties are surely a boost for the Republican just days after Steve Schwarzman, the Blackstone C.E.O., threw his weight behind Trump.

Jury deliberations in Donald Trump’s hush-money trial enter a second day. The panel of seven men and five women on Wednesday asked to hear more pieces of testimony from two witnesses, including that of David Pecker, the former publisher of The National Enquirer. The jurors will reconvene at 9:30 a.m. Eastern on Thursday, with no clear sign on when they might reach a verdict.

Nelson Peltz sells his Disney shares. The hedge fund billionaire divested the roughly $3.5 billion stake in the entertainment giant he controlled. Last month, Peltz’s campaign to appoint directors to Disney’s board failed, effectively ending one of the most expensive proxy battles ever waged.

A Goldman Sachs veteran is tapped to run the Cleveland Fed. Beth Hammack will replace Loretta Mester, who steps down as president on June 30. Hammack, the Wall Street giant’s former co-head of global financing, has decades of experience in finance and capital markets. Her first vote on interest rates could come as soon as the September meeting.

The S&P 500 has edged lower in premarket trading on Thursday, and is on track to snap its five-week winning streak as inflation and interest rate jitters again grip the markets.

Investors are expected to get little relief from Friday’s Personal Consumption Expenditures index. Economists forecast only a slight improvement in the Fed’s preferred inflation measure.

Here’s what to watch for:

  • April’s core P.C.E., which excludes volatile food and fuel prices, is forecast to come in at 2.8 percent on an annualized basis, in line with the previous month but still above the Fed’s 2 percent target.

  • Analysts will be watching for signs that so-called shelter inflation has begun to ease. Pricing on consumer goods has fallen over the past year. The same cannot be said of what households spend on rents and the homes they own. One example: skyrocketing home insurance premiums. This inflation gauge doesn’t put a large weighting on this category of expenditures, but homeowners are feeling the pinch.

“It is the housing crisis that nobody is talking about,” Holly Meyer Lucas, a Florida realtor told The Times.

The renewed focus on inflation follows a strong earnings season. Over the past month, stocks rallied as investors grew more optimistic about the health of corporate America after a string of better-than-expected results. Attention is now shifting back to inflation, the Fed and interest rates.

There are signs that the economy is beginning to slow. On Wednesday, the Fed issued its latest Beige Book report, which showed that consumers were pulling back on spending and showed only “slight or modest” economic growth across much of the country.

Hopes for a near-term interest rate cut are fading. Raphael Bostic, the Atlanta Fed president, said Wednesday that “we still have a ways to go” to tame the “explosive” inflation that emerged after coronavirus-related lockdowns measures were eased. Other Fed inflation hawks have made similar comments lately.

The markets appear to be getting the message. Futures traders on Thursday expect the Fed to lower its prime lending just once this year, most likely in November. Two weeks ago, the consensus call was for two rate cuts.


Senate Democrats want the Biden administration to keep the pressure on Big Oil. Chuck Schumer, the majority leader, and nearly two dozen colleagues have asked the Justice Department to investigate collusion and price-fixing in the sector weeks after the F.T.C. approved Exxon Mobil’s $60 billion deal for Pioneer Natural Resources.

The lawmakers want to broaden scrutiny of the sector. They say their suspicions were raised after the F.T.C. gave the green light to the Exxon-Pioneer deal but also accused Scott Sheffield, the former Pioneer C.E.O., of colluding with OPEC to manipulate prices and barred him from sitting on Exxon’s board.

Sheffield has hit back against the accusations. “They couldn’t find anything wrong with the merger — because the merger only represents 11 percent of the oil in the Permian Basin — so they scapegoated me,” Sheffield told The Financial Times.

“The F.T.C. stands by our allegations,” said Doug Farrar, a spokesman for the agency.

The senators have deeper concerns. The F.T.C. findings “lend credence to the fear that corporate avarice is keeping prices artificially high,” they wrote in a letter to Merrick Garland, the attorney general, and Jonathan Kanter, the Justice Department’s antitrust chief.

Potential collusion “may have cost the average American household up to $500 per car in increased annual fuel costs” they added, and noted that “only the D.O.J. can prosecute and fully redress the alleged anticompetitive behavior.” The Justice Department declined to comment.

The calls come amid a wave of industry consolidation. ConocoPhillips agreed Wednesday to buy Marathon Oil in an all-stock deal worth $22.5 billion, a day after Hess shareholders approved Chevron’s $53 billion takeover of the company.

The U.S. last year set a record for oil production, potentially helping to offset predictions of $100 crude.


Samuel Alito. The Supreme Court justice said he would not recuse himself from two cases arising from the Jan. 6, 2021, attack on the Capitol after reports that flags appearing to support the “Stop the Steal” movement were displayed outside his houses.


In recent months, a barrage of cyberattacks have hobbled companies, with intruders breaking into the digital vaults of UnitedHealth Group, the auction house Christie’s and MGM Resorts in Las Vegas. In each case, the hackers demand big ransoms or threaten to inflict bigger damage.

The latest target appears to be Live Nation’s Ticketmaster, after reports that the hacking group ShinyHunters apparently breached the company’s computer systems and pilfered the account details of more than 500 million customers.

Live Nation has not confirmed the reports, and didn’t respond to a request for comment.

The groups behind these intrusions may change, but the modus operandi is similar. After gaining access, they typically look for sensitive information — customer names, addresses and credit card details — and then demand a ransom.

ShinyHunters is reportedly seeking $500,000 to prevent the information from being sold on the dark web. (One hacker watcher website says it may already be too late for that.)

The payments can be steep. This month, Andrew Witty, the C.E.O. of UnitedHealth, testified before the Senate that the health care giant was forced to pay a different group of hackers a $22 million ransom. “This was one of the hardest decisions I’ve ever had to make, and I wouldn’t wish it on anyone,” Witty said during a contentious hearing.

With hack attacks on the rise, Washington is taking notice. The S.E.C. in December introduced new cyberattack disclosure rules for listed companies that some Republican lawmakers had fought to kill. Compliance has been patchy, however.

The apparent hack has added to Ticketmaster’s woes. The Justice Department sued Live Nation last week claiming it has an illegal monopoly on the live entertainment industry and could force it to break up.

The authorities worldwide are investigating. Australian officials are working with Ticketmaster on the breach, the BBC reports, and the F.B.I. is said to be offering assistance.

Deals

  • Goldman Sachs has amassed a roughly $20 billion war chest to expand into private credit lending — a growing market that JPMorgan Chase’s Jamie Dimon says could sour. (FT, Bloomberg)

  • Saudi Arabia could reportedly start selling more shares in the energy giant Saudi Aramco as soon as Sunday in a deal that may raise at least $10 billion. (Bloomberg)

Policy

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