June 6th, 2025

The Trump-Musk feud and its impact to the global markets

The tensions between President Donald Trump and Elon Musk have sent shockwaves through global financial markets, igniting debates about their implications for risk sentiment, the cryptocurrency ecosystem, and the broader economy.

I will be dissecting this complex 18-hour blowup between two influential figures. I aim to provide a comprehensive, fact-based analysis of this feud’s fallout, weaving together data and insights to offer a clear picture of its ramifications.

This feud, which erupted over Musk’s criticism of Trump’s tax-policy bill and Trump’s retaliatory threats to terminate Musk’s government contracts, has tangible economic and political consequences that extend far beyond their personal rivalry.

Below, I’ll explore how this dispute is shaping investor sentiment, market performance, and the future of key industries, while also considering parallel developments like US-China trade talks and upcoming economic data.

The Feud’s immediate market impact

The public spat between Trump and Musk has undeniably rattled investors, as evidenced by the overnight performance of major US stock indices. The S&P 500 declined by 0.5 per cent, the Dow Jones Industrial Average by 0.3 per cent, and the Nasdaq Composite by a steeper 0.8 per cent. These drops reflect a broader pullback in global risk sentiment, a term that describes investors’ willingness to engage with riskier assets amid uncertainty.

The heavier decline in the tech-heavy Nasdaq suggests particular concern about the tech sector, where Musk’s Tesla is a prominent player. Tesla’s market capitalisation took a staggering US$152 billion hit in mere hours, underscoring the market’s sensitivity to Musk’s influence and the potential threat to his government-backed contracts and subsidies.

This feud’s financial toll wasn’t limited to traditional markets. The cryptocurrency space also felt the sting, with Ethereum dropping seven per cent on Thursday, slipping below the critical US$2,500 level and risking a further decline to US$2,260 after breaching a technical support threshold known as a rising wedge. TrumpCoin, a cryptocurrency tied to the former president’s brand, shed over US$100 million in value, highlighting how quickly sentiment can shift in the volatile crypto market.

These declines occurred despite robust activity in Ethereum’s ecosystem, where stablecoin volume across its Layer 1 and Layer 2 networks surpassed US$11 trillion in 2025, and bot-driven stablecoin transactions hit US$480 billion in May alone. The juxtaposition of this underlying strength with the feud-driven sell-off suggests that while fundamentals remain solid, short-term confidence has been shaken.

Why the feud matters: Economic and political stakes

At its core, this conflict pits two titans with outsized economic footprints against each other. Elon Musk, as CEO of Tesla and SpaceX, oversees companies that rely heavily on government contracts—SpaceX alone has secured billions in NASA and Department of Defense deals—and tax incentives for electric vehicles that bolster Tesla’s bottom line.

Trump’s threat to sever these lifelines could jeopardise Tesla’s profitability and SpaceX’s ambitious projects, potentially leading to job losses and ripple effects across the US economy. Tesla employs tens of thousands, and its supply chain supports countless more, while SpaceX is a linchpin in America’s space infrastructure. Any disruption could dampen economic growth at a time when the labor market, though resilient, faces mounting uncertainty from Trump’s tariff policies.

Politically, the feud escalates with Musk’s explosive accusation that Trump is implicated in the Jeffrey Epstein files, a claim that, while unproven, carries seismic implications. If substantiated, it could trigger investigations, destabilise Trump’s presidency, and fracture the Republican Party, especially if business leaders rally behind Musk in response to Trump’s contract threats.

This personal animosity has morphed into a broader ideological clash—Trump’s “One Big Beautiful Bill” pushes restrictive immigration and reduced green energy support, clashing with Musk’s innovation-driven, sustainability-focused vision. The stakes are high, and the fallout could reshape political alignments and policy priorities.

A glimmer of stability: US-China trade talks

Amid this chaos, investors may find solace in a parallel development: Presidents Trump and Xi Jinping have agreed to further trade talks to address disputes over tariffs and rare earth minerals. These negotiations, while not guaranteed to yield a breakthrough, signal a willingness to de-escalate tensions that have weighed on markets for weeks.

The easing of tariff fears has already nudged commodity prices, with gold falling 0.6 per cent to US$3,352.65 per ounce as safe-haven demand waned, and Brent crude rising 0.7 per cent above US$65 per barrel, buoyed by the Trump-Xi call and an ECB rate cut. Asian shares climbed in early trading, and US equity futures point to a higher open, suggesting that this diplomatic overture could offset some of the feud’s negative sentiment—provided it delivers tangible progress.

The labour market and monetary policy context

Friday’s upcoming US nonfarm payroll report offers another lens into the feud’s economic backdrop. Bloomberg estimates project payroll growth slowing to 125,000 in May from 177,000 in April, with the unemployment rate steady at 4.2 per cent. These figures indicate a labor market that’s holding firm despite Trump’s tariff unpredictability, a testament to its underlying strength.

Yet, a surprise jump in initial jobless claims recently prompted traders to briefly price in an earlier Federal Reserve rate cut, hinting at latent fragility. Rising US Treasury yields—2-year notes up 5.4 basis points and 10-year notes up 3.5 basis points—reflect lingering inflation concerns tied to tariffs, even as the US Dollar Index remained stable at a 0.1 per cent dip. This mixed data suggests that while the economy isn’t buckling, the feud’s uncertainty could amplify any weaknesses the report reveals.

Broader implications for the crypto market

The crypto market’s reaction to the Trump-Musk feud underscores its susceptibility to high-profile narratives. Ethereum’s seven per cent plunge isn’t just a technical correction; it’s a barometer of shaken confidence in a sector where Musk’s endorsements—like his past tweets boosting Dogecoin—have historically driven rallies.

TrumpCoin’s US$100 million wipeout ties directly to Trump’s tarnished image in this spat, illustrating how personality-driven assets can falter when their namesakes stumble. Yet, Ethereum’s US$11 trillion stablecoin milestone and May’s bot-driven surge to 4.84 million transactions show a resilient ecosystem. If the feud escalates, further crypto declines are possible, but the market’s fundamentals suggest it could rebound once the dust settles.

Long-term risks and opportunities

Looking ahead, the Trump-Musk feud poses significant risks. If Trump follows through on his threats, Tesla and SpaceX could face financial strain, curbing innovation in electric vehicles and space exploration—sectors vital to US competitiveness.

Job losses could erode consumer spending, a key economic driver, while a prolonged trade war with China, should talks falter, could disrupt rare earth supplies critical to tech manufacturing. Politically, Musk’s Epstein allegations, if proven, could upend Trump’s administration, reshaping the 2024 election landscape and fracturing GOP unity if business elites back Musk.

Yet, there’s potential upside. A successful Trump-Xi resolution could stabilise markets, boosting equities and commodities further. The feud might also spur Musk to diversify Tesla and SpaceX’s revenue, reducing reliance on government support and fostering resilience. In crypto, a post-feud recovery could draw new investors, especially if Ethereum’s fundamentals shine through the noise. For now, though, uncertainty reigns, and markets remain on edge.

Conclusion

The Trump-Musk feud is more than a headline-grabbing spat—it’s a multifaceted crisis with profound implications for global risk sentiment, cryptocurrencies, and the US economy.

Its immediate toll is clear: US$152 billion erased from Tesla, US$100 million from TrumpCoin, and declines across stocks and crypto. Yet, counterweights like US-China trade talks and a sturdy labor market offer hope, while bond, currency, and commodity movements reflect a complex investor calculus.

Long-term, the stakes involve jobs, innovation, and political stability, with outcomes hinging on whether Trump’s threats materialise, Musk’s allegations hold weight, and trade tensions ease. As this saga unfolds, the world watches, weighing risks against the faint promise of resolution.

Source: https://e27.co/the-trump-musk-feud-and-its-impact-to-the-global-markets-20250606/

Anndy Lian

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com

j j j

May 24th, 2025

Global markets react to Trump’s crypto dinner and Bitcoin’s record high

Global markets are navigating a labyrinth of economic, political, and monetary challenges, each influencing investor sentiment and market dynamics profoundly. Following a rally across the curve on Thursday driven by moderating fiscal concerns, the recent stabilisation of US Treasuries suggests a tentative calm amidst a broader storm.

US equity indices reflected this cautious mood, with the S&P 500 and Dow Jones remaining flat, while the Nasdaq Composite eked out a modest gain of 0.3 per cent. Asian equity indices were mostly higher in early trading, and US equity futures hinted at a slight opening increase of 0.1 per cent, signalling a fragile optimism.

However, beneath this surface calm lies a web of anxieties, centred primarily on the fiscal health of the United States, the world’s largest economy. Moody’s Ratings’ downgrade of the US credit rating last week has intensified these concerns, serving as a stark warning about the nation’s mounting debt. Adding fuel to the fire, President Donald Trump’s tax bill, narrowly passed by the House, has raised fears of ballooning deficits.

Meanwhile, the Federal Reserve’s potential policy shifts and a dramatic surge in Bitcoin trading volumes introduce additional layers of complexity. This article explores these interconnected developments, offering a detailed examination of their implications for global markets and a perspective on the road ahead.

The bond market has been a focal point of investor unease this week, acting as a barometer of confidence in the US economy. US Treasuries initially rallied as investors sought safety amid fiscal uncertainties, driving yields lower across the curve. However, this safe-haven surge was fleeting, as renewed worries about the US fiscal trajectory triggered volatility.

Moody’s downgrade of the US credit rating from its top tier was a seismic event, underscoring the risks posed by a national debt that now exceeds US$36 trillion—a figure that has swelled due to years of budget deficits. The passage of Trump’s tax bill, which promises substantial tax cuts without offsetting spending reductions, has deepened these concerns.

Critics warn that this legislation could add trillions to the deficit over the next decade, potentially pushing the debt-to-GDP ratio to unsustainable levels. The Congressional Budget Office estimates an additional US$5.2 trillion deficit by 2035 if key provisions are extended, a projection that has rattled investors. This perceived fiscal recklessness prompted a sell-off in Treasuries, driving yields higher as investors demanded greater compensation for risk.

The 30-year Treasury yield briefly surpassed five per cent, a threshold not crossed in over a year, before moderating slightly. Rising yields increase borrowing costs for the government and ripple through the economy, impacting mortgage rates, corporate borrowing, and consumer spending, all of which could amplify economic pressures in an already uncertain environment.

Against this backdrop of fiscal turbulence, the Federal Reserve’s stance has taken on heightened significance. Governor Christopher Waller recently offered a glimpse into the central bank’s strategy, suggesting that interest rates could be lowered in the second half of 2025 if the Trump administration’s tariffs on US trading partners stabilise at around 10 per cent.

This conditional outlook reflects the Fed’s vigilance regarding trade policies that could stoke inflation by raising the cost of imported goods. Lowering rates could soften the economic blow of tariffs, making borrowing cheaper and spurring investment and consumption. Yet, this approach is not without risks.

Rate cuts in an economy already grappling with inflationary pressures—evidenced by rising global commodity prices—could overheat markets, complicating the Fed’s dual mandate of fostering maximum employment and price stability. The US Dollar Index (DXY) has felt the strain, consolidating weekly losses as investors weigh the prospects of rate cuts and fiscal instability.

A weaker dollar could bolster US exports by enhancing competitiveness but also inflate import costs, potentially feeding into domestic price increases. This tightrope walk highlights the Fed’s challenge: supporting growth without igniting an inflationary spiral, all while fiscal policy threatens to undermine monetary efforts.

Beyond the US, inflationary pressures are gaining momentum globally, adding another dimension to the market narrative. In Japan, the key inflation gauge has surged at its fastest pace in two years, propelled by escalating food and energy costs. This uptick has bolstered the yen slightly, as markets speculate that the Bank of Japan may tighten its ultra-accommodative monetary stance to curb price rises. Japan’s inflationary trend mirrors a broader global pattern, fuelled by supply chain bottlenecks, geopolitical uncertainties, and the lingering effects of post-pandemic recovery.

Europe, too, is contending with rising prices, prompting discussions at the European Central Bank about policy adjustments. This synchronised inflationary wave suggests that central banks may need to align their responses to prevent destabilising economic disparities. In the commodities sphere, gold has held firm, trading just below US$3,300 per ounce after a slight 0.6 per cent dip, reinforcing its status as a safe-haven asset amid US fiscal jitters.

Conversely, Brent crude oil prices slipped 0.7 per cent to around US$85.50 per barrel, reflecting a de-escalation of tensions between Israel and Iran and anticipation of an OPEC+ output increase in July. While lower oil prices might ease some inflationary strain, gold’s resilience signals persistent investor caution, painting a mixed picture of risk appetite and economic stability.

Amid these conventional market currents, the cryptocurrency sector has emerged as a striking counterpoint, with Bitcoin stealing the spotlight. The leading virtual currency soared to a record high near US$112,000 on Thursday, buoyed by a dramatic surge in trading activity.

Bitcoin futures trading volume spiked to over US$203 billion on Wednesday—the third-highest daily total in 2025—while spot trading volume hit a two-day peak of US$150 billion, the highest in nearly two months, according to CoinMarketCap. Several forces are driving this frenzy. The US fiscal concerns and a softening dollar have pushed investors toward alternatives perceived as hedges against inflation and currency depreciation, with Bitcoin often likened to “digital gold.”

Additionally, the low-interest-rate environment has fuelled a quest for yield, drawing capital into riskier assets like cryptocurrencies. The timing of Bitcoin’s ascent coincides with a high-profile event: President Trump’s dinner for top holders of his TRUMP meme coin, held Thursday at the Trump National Golf Club in Washington, D.C. This gathering, potentially hosting up to 220 attendees, with the top 25 earning a White House tour, has sparked intrigue and controversy.

Bloomberg reports that 19 of these top 25 holders are based outside the US, raising national security and ethical questions about foreign influence in a politically charged crypto venture. Notable attendees include Justin Sun, founder of the Tron blockchain, who has clashed with US regulators over allegations of unregistered securities sales and market manipulation, and who claims to be the top TRUMP holder after a US$75 million investment in the Trump-backed World Liberty Financial platform.

Other guests, such as Singapore’s MemeCore and an Australian crypto entrepreneur, highlight the global reach of this phenomenon. Technologically, Bitcoin’s momentum is robust: the hourly MACD is accelerating in the bullish zone, and the RSI exceeds 50, signaling strong upward pressure.

Support levels at US$110,000 and US$108,200 provide a cushion, while resistance at US$112,000 and US$113,200 looms as the next test. This technical strength, coupled with macroeconomic and political catalysts, underscores Bitcoin’s growing role in the financial ecosystem.

Reflecting on these developments, the current state of global markets reveals a landscape fraught with both peril and potential. The US fiscal situation, exacerbated by Moody’s downgrade and Trump’s tax bill, has cast a long shadow over investor confidence, evident in the bond market’s turbulence and the dollar’s fragility. The Federal Reserve’s hinted rate cuts introduce a wildcard, balancing tariff-driven inflation risks against growth support, while global inflation—exemplified by Japan’s surge—complicates the monetary picture.

Commodities offer a split verdict: gold’s steadfastness betrays lingering fears, while oil’s retreat hints at easing pressures. Bitcoin’s meteoric rise, amplified by trading volumes and political spectacle, signals a shift toward alternative assets, yet its volatility and the ethical quandaries of events like Trump’s dinner temper enthusiasm with caution.

For investors, this environment demands agility—diversifying into safe havens like gold or even cryptocurrencies might mitigate risks, but the latter’s regulatory and security uncertainties warrant restraint.

Looking forward, the trajectory of US fiscal policy, the pace of global inflation, and the maturation of crypto markets will shape the next chapter. For now, global finance remains a high-stakes puzzle, blending opportunity with profound challenges and requiring sharp analysis and measured action from all players involved.

Source: https://e27.co/global-markets-react-to-trumps-crypto-dinner-and-bitcoins-record-high-20250523/

Anndy Lian

www.anndy.com

j j j

April 10th, 2025

Gold jumps 3.3 per cent, Nasdaq soars 12.1 per cent, Bitcoin increases 7 per cent: Inside Trump’s tariff rollback effects

April 10, 2025, the world woke up to a dramatic shift in global risk sentiment, spurred by President Donald Trump’s unexpected announcement of a 90-day pause on reciprocal tariffs for most countries, excluding China.

This move, paired with a jaw-dropping 125 per cent tariff hike on Chinese imports, has sent shockwaves through markets, igniting a rollercoaster of reactions that deserve a deep and thoughtful exploration. Let’s unpack this market wrap, weaving together the data, the human stakes, and my own take on what it all means.

The announcement came like a thunderclap after days of escalating tension, with both the US and China locked in a high-stakes game of economic brinkmanship. Just yesterday, tariffs on China jumped by another 50 per cent, pushing the total to an unprecedented 125 per cent. It’s a bold, almost theatrical escalation, signalling that Trump is doubling down on his hardline stance against Beijing.

Meanwhile, the 90-day pause on tariffs for other nations—a flat 10 per cent duty remains in place—offers a lifeline for negotiations, a chance to step back from the edge of a full-blown global trade war. The markets, ever sensitive to such twists, responded with a fervour that hadn’t been seen in years.

The S&P 500 surged 9.5 per cent, its largest single-day rally since October 2008, while the Nasdaq soared 12.1 per cent, marking its biggest daily gain in 24 years. The CBOE Volatility Index, or VIX, often dubbed Wall Street’s “fear gauge,” plummeted 35.8 per cent to 33.62, a dramatic exhale after peaking at 52.33. It’s as if the markets collectively sighed in relief, at least for now.

What’s driving this euphoria? For one, the pause on universal tariffs has lifted a dark cloud of uncertainty that had been suffocating investor confidence. The prospect of reciprocal tariffs—matching duties imposed by other countries on US goods—had threatened to choke global trade, spike inflation, and drag economies into recession. Trump’s decision to hit the brakes, even temporarily, suggests a willingness to negotiate rather than bulldoze ahead, a pragmatic pivot that markets have seized upon.

But it’s not all rosy. The US-China trade war is intensifying, and with neither side showing signs of backing down, the stakes are higher than ever. The 125 per cent tariff on China is a gauntlet thrown down, a dare for Beijing to retaliate further or come to the table. It’s a risky play, and one that could backfire if China opts for escalation over compromise.

Turning to the bond market, US Treasury yields paint a complex picture. The 10-year yield climbed 3.9 basis points to 4.332 per cent, and the 2-year yield leaped 18.2 basis points to 3.908 per cent, reflecting a surge in risk-on sentiment. Yet, the 20-year and 30-year yields bucked the trend, easing slightly, a subtle hint that investors remain wary of the long-term fallout from this trade saga.

The robust demand at the 10-year Treasury note auction underscores a flight to quality amid the chaos—investors still see US debt as a safe harbour, even as yields tick higher. The US Dollar Index, however, barely budged, slipping just 0.1 per cent. This muted response stands in contrast to the sharp declines in safe-haven currencies like the Swiss franc and Japanese yen, both down 1.0 per cent, as risk appetite roared back to life.

Commodities, too, joined the rally. Gold, often a barometer of fear, surged 3.3 per cent—its biggest one-day gain since March 2020—settling above US$3,100 per troy ounce. At first glance, this might seem counterintuitive given the risk-on mood, but it reflects a dual narrative: relief at the tariff pause, coupled with lingering unease about the US-China standoff. Brent crude oil, meanwhile, climbed 4.2 per cent to US$65 per barrel, buoyed by optimism that a broader trade war might be averted, at least for now.

Over in Asia, indices like the HSCEI rose 3.2 per cent, fuelled by hopes of more Chinese stimulus to counter the tariff squeeze. It’s a fragile optimism, though—US equity futures are already signalling a lower open, suggesting that yesterday’s euphoria might be short-lived.

The crypto market, ever a wild card, erupted in tandem with traditional assets. Bitcoin surged eight per cent to reclaim US$84,000, its strongest intraday gain since mid-March, sparked by Trump’s tariff rollback. Technical indicators hint at a potential sell-wall at US$85,000 as traders eye profits, but the momentum is undeniable. This rally comes on the heels of BlackRock CEO Larry Fink’s Monday warning that global markets could sink 20 per cent if tariffs took full effect—a prediction that now looks prescient, though his call for a “buying opportunity” has proven spot-on with this rebound.

Binance, commanding nearly half of Bitcoin’s spot trading volume, has solidified its dominance, with its altcoin market share swelling from 38 per cent to 44 per cent in Q1. It’s a testament to the exchange’s ability to capitalise on volatility, though it’s squeezing competitors in the process.

Ethereum, however, tells a darker story. Sliding to US$1,380—a level unseen since March 2023—it’s caught in a relentless downtrend, battered by macroeconomic headwinds and uncertainty over US trade policies. Sentiment in the crypto space is souring, with investors questioning whether ETH’s bullish structure can hold. Yet, there’s a glimmer of hope: CryptoRank data shows Ethereum trading below its realised price, a rare signal that’s historically preceded strong recoveries. It’s too early to call a bottom, but this could be an accumulation zone for the brave.

On the central bank front, the Fed’s March FOMC minutes offered little solace, overshadowed by trade developments. Policymakers flagged “longer-lasting inflationary pressures” from tariffs, with risks to inflation skewed upward and employment downward. It’s a sobering assessment, hinting at a Fed that’s boxed in—rate cuts could stoke inflation further, while holding steady might choke growth. Across the Pacific, the Reserve Bank of New Zealand (RBNZ) delivered a 25-basis-point cut, as expected, with a dovish tilt suggesting more easing ahead as Trump’s tariff fallout unfolds. Central banks are on edge, and rightly so.

So, what’s my take? This market wrap is a tale of two narratives: relief and reckoning. The 90-day tariff pause has unleashed a wave of optimism, giving stocks, commodities, and Bitcoin a much-needed boost. It’s a lifeline for a global economy teetering on the brink, and investors are grabbing it with both hands.

But the US-China trade war is a festering wound that won’t heal easily. That 125 per cent tariff is a provocation, and China’s next move—whether retaliation or negotiation—will shape the months ahead. The markets may be celebrating today, but this feels like a sugar high, not a sustainable recovery. Volatility isn’t going anywhere; the VIX may have eased, but at 33.62, it’s still elevated, signaling more turbulence to come.

I’m skeptical of Trump’s strategy. The pause is a shrewd tactical retreat, but the China escalation reeks of bravado over substance. It’s a gamble that could juice US manufacturing in the short term—hence the market’s cheer—but risks long-term damage if global trade fractures. The Fed’s caution and the RBNZ’s dovishness underscore the fragility of this moment.

For investors, it’s a time to tread carefully: the rally is real, but the risks are just as tangible. Gold’s surge tells me fear hasn’t left the building, and Ethereum’s woes remind us that not every asset thrives in chaos. As a journalist, I’ll keep digging, watching for the next twist in this saga—because if there’s one thing I’ve learned, it’s that in markets and politics, the only constant is change.

Source: https://e27.co/gold-jumps-3-3-per-cent-nasdaq-soars-12-1-per-cent-bitcoin-increases-7-per-cent-inside-trumps-tariff-rollback-effects-20250410/