Billionaire tech mogul Elon Musk is feeling the heat on Wall Street and in Washington.

On Thursday, Tesla’s stock took a sharp 14% dive, slashing Musk’s wealth by a staggering $26.7 billion (KSh 3.5 trillion). The drop sent his net worth down to $388 billion (KSh 50.2 trillion), pushing it below the $400 billion mark and rattling investors across global markets.

Billionaire Feud Goes Public

At the centre of the storm? A fiery online feud between Musk and former U.S. President Donald Trump. Musk didn’t hold back when criticizing Trump’s recently unveiled tax and immigration reforms, dubbed the “big beautiful bill”, sparking a political showdown that quickly spiraled out of control.

Trump fired back, accusing Musk of suffering from “Trump Derangement Syndrome.” Musk, not one to back down, hit back by claiming that Trump wouldn’t have secured his second term in office without his influential backing.

Stock Slide Sends Shockwaves

Tesla’s shares fell by $47 (KSh 6,073), closing at $285 (KSh 36,823) and marking the company’s lowest price point in a month. Analysts at Wedbush Securities cautioned that the Musk-Trump rift might negatively impact Tesla’s regulatory environment especially its self-driving car initiatives which rely heavily on favorable federal policies.

“This political drama could shake up Tesla’s future in a big way,” noted Wedbush analyst Dan Ives. “There’s real concern about how Trump’s influence on regulations could hit Tesla’s core innovations.”

Government Contracts on the Chopping Block

Things escalated further when Trump proposed slashing federal subsidies and contracts with Musk’s companies. Writing on his Truth Social platform, Trump said, “Cutting ties with Elon’s firms is the easiest way to save taxpayers billions.”

If implemented, the move could cripple SpaceX and Tesla, both of which benefit immensely from U.S. government support ranging from electric vehicle tax incentives to space exploration contracts.

Musk didn’t take the threat lightly. He retaliated by hinting at freezing SpaceX’s human spaceflight missions and warned that Trump’s aggressive trade policies could tip the U.S. into a recession by the end of 2025.

Tensions Spill Over to Global Markets

Meanwhile, Asian markets wobbled on Friday, June 6, as the Musk-Trump spat cast doubt on a planned diplomatic meeting between Trump and Chinese President Xi Jinping. Investors had been hopeful that the summit would cool rising tensions following Trump’s recent tariff surge targeting Chinese goods.

But with the world’s most powerful businessman and the world’s most outspoken politician at loggerheads, investor confidence is clearly shaken.

---

Bottom Line:
What began as a policy critique has turned into a full-scale political and financial standoff one that’s denting Musk’s empire and spooking investors. Whether this is a passing storm or the beginning of a deeper split between politics and Big Tech remains to be seen.