'Trump tariffs will cause a recession': Musk warns as feud with President deepens, Tesla loses $150 billion

Elon Musk's big warning

The public feud between Tesla CEO Elon Musk and US President Donald Trump has escalated further, with Musk warning that Trump’s aggressive new tariffs could push the country into a recession by the second half of the year.

“The Trump tariffs will cause a recession,” Musk posted on X, signalling the once-strong alliance between the two has now devolved into a full-blown political and personal conflict.

The Trump tariffs will cause a recession in the second half of this year https://t.co/rbBC11iynE
Elon Musk (@elonmusk) June 5, 2025

The public clash between Elon Musk and President Trump has sent shockwaves through the financial markets, with Tesla’s stock plunging over 14% on Thursday erasing nearly $150 billion in market value.

The sell-off followed Trump’s public accusation that Musk had turned against his administration over changes to a key tax and spending bill. “I’m very disappointed in Elon,” Trump told reporters, claiming the Tesla CEO had previously praised the legislation before its passage.

Replying to this Musk has denied he had ever seen the bill. “False. This bill was never shown to me even once and was passed in the dead of night,” Musk posted. He later added, “Without me, Trump would have lost the election… Such ingratitude.”

Things took an ugly turn when the tech billionaire directly accused the U.S. President of being named in unreleased files related to Jeffrey Epstein.

"Time to drop the really big bomb: @realDonaldTrump is in the Epstein files. That is the real reason they have not been made public. Have a nice day, DJT!" Musk posted on X.

The public fallout between Elon Musk and President Trump has shocked many, especially considering Musk’s significant financial backing of Trump’s 2024 campaign and his previous involvement with the administration.