Trump threatens to deport Musk, cut funding over spending bill row
The world's richest person was Trump's biggest political donor in the 2024 election, and became his inseparable ally during his first months back in the White House as head of the Department of Government Efficiency (DOGE).
But the Space X and Tesla boss is now threatening to turn his riches against Trump, mulling a rival political party to challenge Republican lawmakers who vote for the president's 'One Big Beautiful Bill.'
Trump, 79, reacted vengefully on Tuesday as he headed to the opening of a new migrant detention centre in Florida dubbed 'Alligator Alcatraz.'
'We'll have to take a look,' he told reporters when asked if he would consider deporting Musk, who has held US citizenship since 2002.
Trump also signalled that he could take aim at the huge contracts and subsidies that Musk's Space X rocket and Starlink satellite internet businesses receive from the US government.
'We might have to put DOGE on Elon. You know what DOGE is? DOGE is the monster that might have to go back and eat Elon,' Trump said.
Trump added later in Florida: 'I don't think he should be playing that game with me.'
'Head back home'
In reply to a post on his X social network featuring Trump's deportation comments, Musk said on Tuesday: 'So tempting to escalate this. So, so tempting. But I will refrain for now.'
Shares of Tesla sank around five per cent Tuesday after Trump's threats.
Trump had made similar comments on Monday, saying Musk was attacking the bill because he was annoyed that it had dropped measures to support the electric vehicles (EV) industry.
'Without subsidies, Elon would probably have to close up shop and head back home to South Africa,' Trump said on his Truth Social network.
The tycoon and the president shared a brief but intense bromance after Trump's return to power in January.
Wearing MAGA baseball hats, Musk was an almost constant presence at Trump's side. Trump returned the favor by promoting Tesla electric vehicles when protesters targeted them for Musk's cost-cutting drive at DOGE.
But they had a huge public blow-up in May as Musk criticized the spending bill and then left the government.
'Don't bankrupt America'
Musk had kept a low profile in recent weeks but returned to the fray as the bill began its difficult path through Congress.
He has since posted a steady stream of posts against the bill on the X social network that he owns.
The billionaire's criticisms centre on claims that the bill would increase the US deficit. He also accuses Republicans of abandoning efforts to place the United States at the front of the EV and clean energy revolution.
'All I'm asking is that we don't bankrupt America,' he said on social media Tuesday, accusing Republicans of supporting 'debt slavery.'
More worrying perhaps for Trump is the way that Musk is seeking to target vulnerable Republican lawmakers ahead of the 2026 US midterm elections.
Musk has said he will set up his own political movement called the 'America Party' if Trump's bill passes.
And he has pledged to fund challengers against lawmakers who campaigned on reduced federal spending only to vote for the bill.
'VOX POPULI VOX DEI 80% voted for a new party,' he said after launching a poll on the idea on X. — AFP
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The Star
2 hours ago
- The Star
Bonded to interest rates
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'Moreover, with growing expectations that Bank Negara may cut the OPR in the second half of the year, yield differentials could widen further, potentially dampening foreign appetite for ringgit-denominated bonds. 'If the Fed maintains the current interest rates while Bank Negara cuts its OPR, the widening yield between the UST and MGS differential could reduce the attractiveness of Malaysian bonds to foreign investors and put pressure on the local ringgit,' he added. Meor Amri said another challenge lies in geopolitical uncertainties, especially around US trade policies under President Trump's administration, which could trigger market volatility and risk-off sentiment. He said the recent surge in foreign demand for ringgit bonds in March and April 2025 was driven by uncertainty surrounding President Trump's flip-flopping tariff policies and his proposed 'One Big Beautiful Bill'. These developments have prompted some bond investors to reduce their exposure to UST and seek diversification in emerging market assets such as MGS, he noted. Foreign net buying of Malaysian bonds surged to RM10.2bil in April this year compared to RM3.2bil in March, marking the second consecutive month of net inflows, despite 'Liberation Day' tariffs announced on April 2, 2025. The increase was primarily driven by strong demand for MGS and government investment issues (GII), which attracted RM9.7bil of inflows (March inflow: RM3bil), as well as the shorter-term Malaysian Treasury Bills (MTB) and Malaysian Islamic Treasury Bills (MITB). OCBC Bank (M) Bhd head of global markets Stantley Tan said the future demand from foreign investors for ringgit-denominated bonds would largely depend on a variety of macroeconomic and domestic factors. Since the onset of 2025, he said global economic uncertainties have escalated, primarily due to rising geopolitical risks and inconsistencies in US tariff policies. He said the imposition of substantial trade tariffs by the United States on its trading partners has disrupted global trade flows and increased the risk of a recession, particularly within the United States. As trade negotiations continue, investors have also rebalanced their portfolios, reallocating investments towards emerging markets and economies less impacted by the tariff conflicts. 'On the domestic front, Bank Negara has reiterated its confidence in the resilience of Malaysia's economy, which is fundamentally supported by robust domestic demand. 'However, the tone of the monetary policy committee (MPC) statement has shifted from cautious optimism to a neutral-dovish stance, reflecting the heightened external risks. 'In its latest meeting, the MPC reduced the SRR by 1% to provide additional liquidity support to the economy,' Tan said. He said the ringgit bond market has started to price in the possibility of a policy rate cut in the coming months following the central bank's slightly dovish tone. However, he said the risks to the current bond valuations remain, particularly if the economy proves resilient, prompting Bank Negara to hold policy rate steady, which could lead to a repricing of the bond market. 'A significant fiscal improvement by the government could mitigate the risk of a sell-off by easing the supply of MGS and GII in future issuances. Additionally, external risks may arise from the potential resolution of the US fiscal situation, which is currently under intense scrutiny by global investors. 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'The continued easing of market volatility recently may help support investor appetite for risker emerging market bonds in the short term, but it may be capped by the still-elevated uncertainties, especially as the 90-day pause on higher reciprocal tariffs is nearing its end. 'The potential future volatility from other proposed tariffs will likely leave foreign investors teetering on the edge,' she said. However, she said a tapering yield differential between the UST and MGS may help buoy some foreign demand for domestic bonds this year. 'With the Fed widely expected to reduce the federal funds rate in the face of slower economic growth, Bank Negara is expected to keep its OPR at 3%. This could help compress the UST-MGS yield spread, which should increase the appeal of Malaysian bonds and strengthen the ringgit this year. 'The country's strong economic fundamentals and prudent fiscal discipline also play important roles in making the country an attractive investment destination. 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The Star
2 hours ago
- The Star
Trump's 35% tariff threat feeds Japan's worst-case scenario fear
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Japan has so far stood firm in negotiations over across-the-board reciprocal tariffs, insisting that they be removed along with additional sectoral tariffs on autos, steel and aluminum. The car duties are particularly painful for Japan as the industry contributes the equivalent of almost 10% of gross domestic product and employs around 8% of the workforce. Tokyo has insisted that a "win-win' deal must encompass all the tariffs in one go with Ishiba preferring no deal to a bad deal ahead of a July 20 upper house election. The prime minister on Wednesday reiterated his view that focusing on jobs and investment in the US was the way forward, just like it was for Nippon Steel as it patiently sought to change Trump's view and take over US Steel. "Japan is the biggest global investor in the US and the world's biggest contributor to US jobs,' Ishiba said in Tokyo on Wednesday. "That means Japan is different from other countries.' 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The Sun
2 hours ago
- The Sun
Gaza rescuers say Israeli strikes kill 14 as Trump teases ceasefire push
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