Patrick L. Young, Chairman & Founder of Exchange Invest, joins Remy Blaire to discuss the escalating feud between Elon Musk and President Trump, sparked by Musk’s criticism of Trump’s government spending and his controversial accusations regarding Trump’s ties to the Epstein files.
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One big ugly spat the rift between Elon Musk and President Trump over the GOP's budget bill escalated last Thursday.
Musk dug up Trump tweets from 2012 that railed against big government spending.
Musk also accused Trump of being named in the Epstein Files, a post he has since deleted.
Trump threatened SpaceX's government contracts and has warned Elo of serious consequences if he funds Democrats in next year's midterms.
The shocking squabble tanked at Tesla and Trump's true social stocks on Thursday.
The crypto market also briefly fell as Musk hurled more severe accusations.
Well, joining me this morning to weigh in is Patrick Gal Young, chairman and founder of Exchange Invest.
Patrick, good morning.
Happy Monday.
Thank you so much for joining us.
So a lot of drama unfolding on social media.
So what do you make of the sudden as well as dramatic rift between Musk and Trump?
Well, Remy, good morning.
In some ways, isn't it a little bit like listening to Real Housewives of Washington DC Capital Edition?
I don't think either party has come out of this particularly brilliantly well, although at the same time it has to be said.
Elon Musk fundamentally transparently failed at Doe.
She was going to cut $1 trillion if not $2 trillion he said.
Managed to get a couple 100 million, a couple $100 billion something like that, essentially peanuts.
Then to come back and attack Trump seemed quite odd, saying Trump's spending too much in his big beautiful bill because of course actually Trump was relying on these cuts that Musk was going to make.
Overall, actually the thing that a lot of people have not said while every never Trumper has come out of would work to damn the president is actually Trump is behaving remarkably well here.
He's been incredibly mature by the standards of Donald Trump.
He hasn't got into the swamp in the same way that Musk has, and that actually bodes rather well for, for example, the Chinese trade negotiations that are starting today in London.
Yeah, and I'm glad you mentioned that, Patrick, because there's been a lot of drama on social media, but there's still a lot of unanswered questions.
So for now I do want to talk about Tesla because we saw that stock drop in the on Thursday and then Friday partially recover.
So tell us your take on what we saw with that stock, especially as we are kicking off the week with some downgrades on that name.
Well, Tesla finds itself in the middle of the perfect storm, albeit bad news for Tesla from every direction.
I was in Shenzhen just a month and a half ago.
People drive around in Teslas.
They love them.
They pat the bonnet and they say Made in China.
Where does that leave ultimately the Tesla company in the midst of this?
Of course they produce cars in the USA, but they've got a huge reliance.
On what comes out of China, so they're directly related to what's going on in the trade war.
They're being hit by the fact that Donald Trump is eager to drill baby drill, and therefore we've got a fundamental problem because Tesla's looking very, very exposed here because the liberal kind of fraternity that traditionally bought Teslas now can't stand Elon Musk and say unspeakable.
Things about him that we're not going to discuss at this time of the morning on live television.
So therefore he's lost a huge amount of his potential client base.
His cars are quite a lot produced in China, which is bad news in America, and equally, therefore, he's incurred the wrath of the president.
Hardly surprising that a very, very, very high multiple stock would be looking not so puffy this week.
And Patrick, as we are speaking, we know that US officials, including Bessan Lutnick and Greer are in London meeting with Chinese officials.
Last week, Trump did speak to Xi Jinping and the US and China trade reps meeting in London.
So where are we at when it actually comes to US-China relations and it's very interesting that we also heard from Johnson Huang this morning, isn't it?
Look, it's fascinating what we're hearing because ultimately while China initially raised the temperature up to pretty much thermonuclear levels, they've walked that down incredibly an hour and a half telephone conversation, I have to say it beggars belief what you say between President Xi and Donald Trump over an hour and a half, but it certainly must have been wide ranging and quite detailed.
Now you've got a lot of big guns that are.
Trusted by Trump, Bessant and Lutnick amongst them in London for these talks.
They're on third party ground.
I think there's a lot of optimism in the air and certainly reading things like the South China Morning Post this morning from Hong Kong, they're cautiously optimistic that we're going to manage to see the world trade moving forward, but it's going to be under different terms, which, let's face it, was what Trump was seeking in the first place.
And Patrick, speaking of conversations that Trump is having with leaders, Trump also spoke to Putin and noted he might help Iran agree to some form of a nuclear deal.
So how do you see the evolving situation unfolding when it comes to Iran and also with the war between Russia and Ukraine?
Well, Iran is a dreadful situation.
Obviously remains under a hideous government.
The nuclear program is a worry for many, particularly Israel and the USA.
It seems to me that Putin is trying to find a way to take himself off the naughty step in Trump's viewpoint.
He's also trying to recover from this very, very embarrassing drone attack where the Ukrainians took out a third of his nuclear bombers just in the course of.
Last two weeks and thus he needs to find a way forward.
At the same time, I think a deal is there to be done with Iran.
So Putin trying to nudge that forward is a very clever piece of politics by Putin as he tries to make himself relevant because ultimately the problem is the Russian economy is just not the relevant superpower it was in the 1950s, 1960s, and 1970s when we worried what the communists were going to do.
And finally, Patrick, before I let you go, here in the US, all eyes are on inflation figures this week, CPI figures, not to mention PPI, and this does come on the heels of that jobs report we got last week.
So what do you expect the Fed to do, not just at the upcoming meeting next week, but for the rest of this year?
There's a very interesting dichotomy at the moment.
Europe has been cutting rates.
The most concerning thing to me is not actually the numbers coming out of the USA.
It's what we're seeing in parts of Asia.
Look at Taiwan.
The currency is depreciating.
That actually could have a big impact on the US bond market following through, because ultimately, therefore, they're going to have to sell bonds in order to manage to meet their liabilities.
If you look at Hong Kong, where the currency.
Pegged to the US dollar, interest rates are at one basis point.
US interest rates are at 4%.
I think what we're going to see is pressure on rates to come down in the USA in the near future because hopefully we're not going to see a huge amount of inflationary uptake in the near term.
But obviously it remains open to be seen what's happening because this has been a very, very volatile period thanks to trade uncertainty.
Well, thank you so much, Patrick, for joining us here in the US.
We'll keep an eye on that 30-year bond auction that's coming up on Thursday.
So, thank you so much for joining us and we look forward to having you back on shortly.
Thank you.