Elon And Trump Break Up - What Happens Now

Welcome back, everyone today on the Joseph Carlson Show. If for some reason you were offline or away from the news over the past 12 hours, then you missed perhaps one of the biggest beefs of all time. This is the beef of the most powerful man in the world and the richest man in the world. We've seen inklings of this relationship deteriorating over

the past 24 hours. The first signs were Elon Musk criticizing President Trump's key legislation, the big beautiful bill, calling it a bloated pig. And from there, things derailed. Yesterday was the day that Trump and Musk torched their partnership. The relationship has completely imploded. Insults, intense insults, were hurled left and right from one to the other across the web for the world to see.

And today we're looking at it from aftermath, like a like a big accident happened, like a plane crash or a train wreck. And we're just looking at what happened. Now we're going to be going through the details, the timeline of events, how we got to this point, what it means for both President Trump and what it means for Elon Musk.

We're also going to be going over many of the responses to this event, people like Dan Ives, Gene Munster, these are Tesla investors, Tesla enthusiasts going on the TV quickly to play damage control. Now, we also have some good news. On the day we had the jobs report come in. This was hinted at by the ADP report that looked really gloomy. The jobs report came in a little bit higher than analysts expected. We'll be looking at the numbers and what this means for the market.

We also have news that Lululemon reported their earnings are down 20%. We're going to see what's going on with this company, why the stock is cratering.

And we have a report from the information that Amazon is reportedly training humanoid robots to deliver packages. We'll be looking at this as well. Now, we have a lot to cover in this episode, and we'll start things off with the main story, the implosion of this

relationship. It seemed like just yesterday that Elon Musk and Trump were together in the Oval Office, talking about how good the relationship was, how appreciative Donald Trump was of Elon Musk's efforts, Musk there in his doge hat, his doge father T-shirt, standing alongside the president. Now, this was a kind of odd, sometimes awkward relationship from the beginning. Having the richest person in the world, a business leader, intermingling with the president.

It's just a bit different than what you normally see. But we saw this go on for months where Elon Musk was basically one-on-one with Trump all the time. And from what we heard, even though they may not agree on everything, they're besties, they're friends, they're very close with each other. Some people even called them family. In fact, there were family and extended family photos of them taken at Mar a Lago, like they had adopted Elon Musk into the family.

Now, Fast forward just a few moments, and the front page of the Wall Street Journal is literally filled with articles about the implosion of this very relationship. So how did we get here? The first thing that I think is important to note is that there has been frustrations building up with Elon Musk and the White House administration, which is President Donald Trump's team. Those two groups, Elon Musk and presidents team, have grown a little bit frustrated with each

other for some time. In fact, just six days ago, senior Trump aides swallowed their irritation with Elon Musk and planned a chummy Oval Office send off for him.

They briefed the president on the allegations of Musks drug use so Trump would be ready to defend the billionaire when reporters raised the issue at his goodbye event as late as Wednesday evening, Trump played down any conflicts with Musk in meetings with Republican senators, even though the billionaire had spent the past few days disparaging the president's legislative agenda. That's the big thing that's

caused this. If you've been on X or Twitter or whatever you want to call it, Elon Musk has been non-stop bashing the Republican legislative agenda, The big beautiful bill. Now you can have whatever thoughts you want on the big beautiful bill. You can believe it's a bad bill or a good one, or you can believe that in politics you don't get everything you want. You're not going to get all the tax cuts or the incentives or the credits or everything that you want in a single bill.

After all, you have a lot of representatives, a lot of limitations, a lot of constituents representing different cohorts of the population. Now, Elon Musk knows that President Trump can't just demand everything he wants in a single bill. He has to make these compromises. Republicans have a slim majority in the House of Representatives, but Elon Musk was highly critical of the bill anyways.

It seems like Elon Musk wasn't just critical of the bill, but the bill was representative of his frustrations of other things going on in the White House, other things happening personally between his relationship with the administration. And there are some things that Elon Musk was likely frustrated about over the weekend.

After Trump dumped Musk's ally as the head of NASA, the president made it clear to associates that he wasn't planning a high profile confrontation with his former adviser, according to a person who talked with the president. Now, this doesn't seem like that big of a deal, but this is actually a big deal. Elon Musk had a strong suggestion of the head of NASA and the Trump administration did not listen to Elon Musk's suggestion.

That seemed a bit underhanded to Elon Musk because after all, he's the one flying rockets to space, he's the one with SpaceX. He has likely more experience than most people on Earth with dealing with these type of technologies. So he felt like he had big weight in the decision of the head of NASA. And Trump didn't ultimately go

with Elon Musk's suggestion. So you see how that could be frustrating for Elon Musk. After this event of him not choosing the head of NASA that Elon Musk wanted, all goodwill disappeared on Thursday. Elon Musk's critiques and criticisms for the big beautiful bill got more and more intense. Calling it a bloated pig, calling it all these names.

And Trump had heard enough. 13 minutes into an Oval Office meeting with the German Chancellor, Trump laid out his frustrations with Musk. Listen to what Trump says here and keep in mind he has the German Chancellor in the White House in the room with them. Look, Elon and I had a great relationship. I don't know if it went well anymore. I was surprised because you were here. Everybody in this room practically was here as we had a wonderful send off. He said wonderful things about me.

You couldn't have nicer said the best thing. He's worn that hat. Trump was right about everything, and I am right about the great, big, beautiful bill. President Trump initially addressing this issue seemed to be somewhat moderate. He actually showed a little bit of restraint here. He didn't hit back on Elon Musk or do anything too personal. He just said that he disagrees with them. But after enough time, this got to a boiling point. President Trump had heard

enough. By Thursday night, Trump had publicly toyed with cutting off government contracts to Musk's companies. He said that he went crazy and suggested that he is suffering from Trump Derangement Syndrome. Now, I don't mind so much the Trump Derangement Syndrome insult there or even saying that he went crazy. Obviously these are big insults. But what's really uncalled for from the president is to toy with cutting off government contracts from a private company because of a personal feud.

The president should not be doing that. It is indefensible for President Trump to use his position to try to determine the outcome of companies because of personal feuds. So in that case, he was completely wrong. Now this gets so bad from here. It gets so much worse than you would anticipate. Musk floated. He started floating the idea of a new political party, suggesting that Trump should be

impeached. Argued that Trump's tariffs would trigger a recession and pledge to decommission a valuable piece of space equipment. So once President Trump targeted Elon Musk's businesses, he gets real personal. The message is again posted the entire world. None of this is done behind closed doors. This is all just the hundreds of millions of people Elon Musk says I'm sorry but I can't stand anymore. This massive outrageous pork filled congressional spending bill is a disgusting

abomination. Shame on those who voted for it. You know you did wrong. You know it. Elon Musk says whatever, keep the EV solar incentive cuts in the bill even though no oil and gas subsidies are touched. Very unfair. But ditch the mountain of disgusting pork in the bill. In the entire history of civilization, there's never been legislation that both is big and beautiful. Everyone knows this. Either you get a big and ugly bill or a slim and beautiful bill. Slim and beautiful is the way.

So Elon Musk is taking a bit of Trump strategy of branding. Trump loves giving these monikers and names to things big and beautiful. And in this case, he's using that tactic against them, saying it's slim and beautiful or big and ugly. Now, you have to know Elon Musk and Trump when you're renaming bills and going after things, his key piece of legislation, which Trump is trying to advertise as this great bill for America. This is personal. This isn't friendly banter

between two friends. Now, when Elon Musk gets in these cycles of accusations, we've seen him do this before. He did the same thing with Sam Altman. He gets in a cycle like he gets out of control or he loses his nerve and he posts and posts and posts on X, with the posts getting more severe, more personal. Anything that he can scrap together as a gotcha insult he tries to put in this flurry of posts.

The next one from Elon Musk is without me, Trump would have lost the election, Dems would control the House and the Republicans would be 51 to 49 in the Senate. Such ingratitude. Now again, this doesn't seem too bad, but realize that this is a very personal message. Trump and Elon Musk are both very prideful people, very proud of what they accomplish. When we look at Trump, he won that election and Elon Musk is trying to take the Thunder away from him, saying it wasn't because of you.

I did that. I'm the one that won you the election. He is directly trying to steal the limelight, the Thunder, the credit for winning the election from Trump. That's about as personal as it can get. Do you think Trump likes hearing that someone else is taking credit for his victory? No chance. No chance that he enjoys hearing that from Elon Musk. This is about as personal as it can get. Elon Musk is trying to get under Trump's skin any way possible. But he doesn't end here.

The flurry of posts continue. In the mix of this, President Trump starts to respond on his own version of Twitter, which is Truth Social. He says Elon was, quote, wearing thin. I have asked him to leave. I took away his EV mandate that forced everyone to buy electric cars and nobody else wanted that. He knew for months I was going to do and he just went crazy. Now this is kind of like a tit for tat. President Trump is saying, hey, you're taking credit for me

winning the election. I'm going to go ahead and say that nobody wants to buy your vehicles unless they have an EV credit. So they're they're both kind of striking at each other's egos, taking away credit. You're you're successful, your company's successful because of government EV credits. And Muscar is saying you're successful because I got you into the White House.

Trump also continues to post saying the easiest way to save money in our budget, billions and billions of dollars, is to terminate Elon's government subsidies and contracts. I was always surprised that Biden didn't do it. There he is again striking directly at Elon Musk's businesses. There we have them trading these individual insults, striking at each other's pride. Then we move on and get to the big bomb, as Elon Musk calls it.

This is kind of like his drop the Mic moment in this ridiculous feud between these two people. Elon Musk says time to drop the really big bomb. Real Donald Trump is in the Epstein files. That is the real reason that they have not been made public. Have a nice day DJT. He has a nice little sign off there to try to really let it sink in. Try to make that one really hurt.

And that's the big bomb. This is the one that's going to get hundreds of thousands, millions of likes, tons of retweets suggesting that President Trump doesn't want to release the Epstein files because he has incriminating evidence within it. Elon Musk a few minutes after posting that, doubled down and said, mark this post for the future. The truth will come out. And this is the last big bomb dropped in this entire dispute.

Now looking at this timeline of events, this entire dispute, I want to Fact Check a couple things and give some important context here. The first one is the EV and solar incentive dispute. Elon Musk says that he doesn't care if you remove the EV solar incentives, but you're not removing any subsidies for oil and gas. And that's unfair. And there's also been many people that have told me that Elon Musk has been very outward and very affirmative in saying that he doesn't mind if the EV

and solar incentives are cut. He doesn't care about them at all. That's what he publicly says. Those don't matter now to a Tesla investor, these EV solar credits actually add up to a lot of money. In 2023, for example, Tesla made $1.79 billion in sales from carpet credits. Those are regulatory credits. These are the EV credits that we're talking about here. If they're removed, this 1.79 billion vanishes. $1.79 billion is a lot of money to a company that's only generating less than

$7 billion in free cash flow. This makes up a good chunk of the profitability of Tesla. These EV credits have been beneficial in getting people into EVs. So Musk is saying publicly, and he said before that he doesn't care about the EV credits, go ahead and remove them. But obviously they do mean a lot to Tesla. They help out Tesla's business. Now on the note that it's unfair because there's oil and gas subsidies. There are no tax credits for buying a gas vehicle.

You go and buy a gas vehicle, you are paying full price for that vehicle. So the oil and gas subsidies they're talking about are for the businesses themselves, for the CapEx investments. There are huge oil subsidies and gas subsidies for the businesses themselves, but there's also huge incentives for every big business, including Tesla.

The Nevada Gigafactory received a $1.3 billion tax incentive package from Nevada. The Vermont factory received a $465,000,000 loan from the US Department of Energy. Even outside of the US, Tesla receives government subsidies. This happens with virtually every big business. All these businesses are subsidized by the government, but EVs are uniquely subsidized in the direct purchase of a vehicle, and gas vehicles do not receive that credit.

On the note that Elon Musk doesn't care about the removal of EVs because he said so publicly, there is conflicting reports on this. Bloomberg reported that Elon Musk is on a mission to block President Donald Trump's tax bill after he tried and failed to convince Republican lawmakers to preserve valuable tax credits for electric vehicles in the

legislation. The Tesla chief executive officer personally appealed Mike Johnson to save the tax credit, the person said, requesting anonymity to discuss a private conversation. Again, this this could possibly be wrong. Maybe the informant in this case doesn't really know or it's just made-up.

But either way, there are reports that he was trying to keep these in. The other big thing that I think needs to be addressed is this claim by Elon Musk that there's this huge incriminating evidence of President Donald Trump on the Epstein files and that Elon Musk is Privy to this and he has this big smoking gun. He knows this information. There's a couple of reasons where I don't consider this threat serious at all. Frankly, I don't think Elon Musk

has anything here. One of the reasons why is because these files have existed for years under Democratic control. And there's a lot of things that I'm willing to believe. But one of them that I'm not willing to believe is that the Democrats knew about and had access to highly incriminating evidence of President Donald Trump, and they never released it. I cannot come around to that conclusion.

There's some people saying or suggesting that the reason that the Democrats would not release incriminating evidence on Donald Trump is because there's also incriminating evidence on the Democrats. But I don't believe that would be the case. I think even if there was incriminating evidence on some Democrats, they would have still released it to sink Trump. They couldn't withhold themselves. They couldn't help themselves.

If they really had access to information that would sink Trump, that would make it so he couldn't become president, they would have released it and taken down anyone of themselves along the way. The other reason why I don't believe that there's anything actually here is because Elon Musk is not exactly new to launching baseless or evidenceless accusations. He's done this thing a time or two. In fact, he's done something almost entirely similar to this exact post.

Six years ago, Elon Musk called the British diver in the Thai cave rescue mission a pedo and a baseless and evidenceless attack. Now, why did this happen? Because at the time, Tesla tried to develop these quick little mini submarines to go through and save the kids. This was Tesla's effort to try to help out, and it was pretty cool at the time. They were trying to help, but this cave diver promptly said that these were basically a waste of time. They wouldn't help.

They're too big, they're not going to fit through all the jagged edges that you have to go through in these caves. And Elon Musk took that as an insult, saying that his time and effort was wasted here, that these things are basically not useful. Elon Musk didn't like hearing that, and he attacked The Cave diver. He launched these accusations, calling this guy the same thing over and over again. And the guy eventually sued him

for defamation. And during the trial process, Elon Musk actually looked at the diver's background, tried to do retroactive research to see if there is anything to justify the claims he had already made, and he found nothing, absolutely nothing. This was a totally baseless, warrantless, evidenceless attack. Elon Musk has a history of saying things he probably shouldn't say that aren't exactly true during times of

great frustration. And just like in The Cave divers situation where he actually apologized for saying those things, saying he was frustrated at the time, I see a very similar pattern in this case. This tweet is the response of Elon Musk trying to get under Donald Trump's skin, saying whatever he can out of frustration.

So for a few reasons, I don't believe if there's any big incriminating evidence that Elon Musk knows alone, maybe I'll be proven wrong, but I just don't believe Democrats would sit on that evidence and not release it. Even if it took down some of their own members, they would want to release it. Elon Musk has a pattern of doing

this type of thing. And then finally, it also would speak volumes about Elon Musk's character if he truly knew about some big incriminating thing that the president did, but he's refusing to release any details or he just waited until now during a fight to release it. That's not exactly a great look

from Elon Musk either. To me, this strikes me as someone out of frustration, going through a feud very publicly, someone targeting his company, his accomplishments and his pride, and is responding with a lot of frustration like he's done in previous times. Now, after all of this happened after Elon Musk dropped this bomb, Trump was reportedly taken

aback by Musk's escalation. Trump told advisers he didn't believe he was harsh about Musk in the Oval Office and was surprised at how aggressive Musk became. Trump's aides spent some time Thursday trying to figure out what Musk's goal was. The president told advisers that Musk was just being a child. Now, understandably, a lot of people are confused by the situation. Some people that love both Elon Musk and Trump don't really have

a home or an identity right now. They're being forced to pick sides in sometimes awkward cases. Tesla stock is up 6% on the day, but that's after dropping over 15% yesterday. Now, Elon Musk is in the process of trying to walk back a lot of the damage done, making a bit more of a joke out of it. And there's also a report that Musk was going to talk to the administration this morning, that he had a call scheduled with the White House.

That report is not true. Trump says he's not interested in a call with Musk. Now, while this is all going on, we also have the Tesla thought leaders, the investors in it, the ones that are trying to play damage control in the situation as fast as possible. We had Dan Ives go on the TV and explain how he thinks this is working out. I I mean, there's a view that the battle here going on between Musk and Trump that this is going to continue to sort of,

you know, increase. And what that ultimately does is that autonomous in the regulatory vision. Does Trump now now not start to play nice in the sandbox with Musk? Now, on this point, Dan Ives is exactly correct. Part of the reason that Tesla's stock rocketed up 30% after Trump's victory is the thought process that Elon Musk had closely aligned himself as an ally to the president, a key holder to regulatory approval.

Many of Musk's businesses, including Tesla, operate in highly regulated industries, robotaxi being one of the most highly regulated in existence. In many cases. When I bring up Google and I look at what Waymo's doing, a lot of people are suggesting that the big limiting factor to Waymo's growth is manufacturing capacity, that they can only grow as fast as they can manufacture or outfit cars with their sensors. That cost, that capital is the

big limiting factor here. And I think those people are wrong. I don't think that Google's Waymo is limited by CapEx, manufacturing or any type of capital restraint. I believe the biggest bottleneck for Waymo by far is regulatory approval, proving that they have a safe product that they can scale to different cities, different capacities, different types of roads and airports and do so safely over time and get all the green tape to do so in

different localities. That is a massive undertaking. Waymo has the backing of Google. Google, if you don't know, has virtually unlimited cash flows. They generate in a single quarter, $20 billion. Google could buy unlimited amount of vehicles. They could buy hundreds of thousands, millions of vehicles in a single quarter if they wanted, and they wouldn't even have to go to the bank to do so. CapEx is not a restraint for Waymo. They could invest unlimited amounts of CapEx.

They could scale up as fast as they want. The big limiting factor here is regulatory approval. Regulatory approval is done through the government and part of what Elon Musk had working to his benefit. It seemed like a genius 4D chess move was to become so close with the biggest person, the person that has the most control over regulation, which is President Donald Trump. So by having that close relationship, Elon Musk had both

things at his side. He had regulatory approval or at least an easier path to get regulatory approval. And of course, Tesla has the manufacturing know how. But in this case, Dan Ives is correctly illustrating that out of the things that Elon Musk did, what he did yesterday is sever ties. And not only severed ties, but he burnt bridges. He exploded the bridge with a nuclear bomb with President Trump.

They're not friends anymore. And President Trump is likely not going to do anything specific to help out Elon Musk's business. Tesla is now left to its own devices with regulation. Elon Musk made sure of that yesterday and that is not good for the Tesla investor. Yeah, I mean, the timing is is obviously very head scratching in terms of must just going aggressively right in terms of

the shot across the bow. And I was next next week you have the launch of Cyber Cab robotaxis in Austin, so a friends fight. So again, I think this is not one that you could basically say this is going to continue to get worse and worse. But clearly there's a line in the sand here. Musk has taken a stands. But I think the broader view, the reason Tesla stocks off the way it is and I think overdone is because the view that this means that Trump is not going to play nice when it comes to

regulatory autonomous. And a big part of the view, the Dow is going to be a huge positive, and I still believe it is for Musk and Tesla. This is possibly one of the most ridiculous takes that I hear. And this isn't just an Ives. There's a lot of people that are going along with this take trying to downplay the the feud here, saying friends fight, friends fight. Who amongst us hasn't fought like this? Haven't you? Haven't you fought like this with one of your friends?

I mean, really, who hasn't gone on to X with hundreds of millions of followers and said that your best friend was on the Epstein list? If I had a nickel for every time I've done that with my best friend, Come on, Dan, friends don't fight like this. This is not something we can just chalk up to a friendly banter, to a little mishap, to a tiff. Of course friends fight.

That's a truism. Every friend really does fight at one point or another, but typically that's over a small disagreement, something that's handled through text or in person, not blown out to the entire world on X. Not insinuating that your friend is on the Epstein list. Friends do not attack each other in front of the world with the most salacious and insidious accusations possible. This is not just some friend fight. And the people that are trying to downplay this like oh this is

something everybody does. It's just ridiculous. I don't know about the rest of you, but if I had a friend that did this, that went online and attacked me in similar fashion, that would not be my friend anymore. We would no longer be friends. That's not a typical fight. That's not something you just shrug off and easily move past. It's it's a bit different of a level. Now. I understand the attempt for people that are fans of Elon or Trump to downplay this.

I really do. You want to try to downplay it. And even Elon Musk, I think is walking back some of this after some of his frustration and and heated feelings have cooled down a little bit. But the words here that were shared were not of a normal friend fight, and we shouldn't try to pretend that they were. This was an embarrassment. An embarrassment for the country, an embarrassment for Elon Musk, and an embarrassment for Trump.

It was embarrassing all around. It should have been handled in closed doors or over a phone call, not blasted out to the entire world. Now Dan goes on to give his continued optimistic view about the future of Tesla. And this is stock that I mean, I could argue it could be down a little. And it's my view that like if you're a believer in autonomous like we are in robotics, this is a $2 trillion mark cap in terms of Tesla.

But the view that you went from basically first, buddy, in terms of Musk with Trump in the White House, Mar a Lago, and now they're doing this fight over social media. It's not what you want to see as a Tesla shareholder. And, and you saw with Trump, I think Trump's obviously a little taken aback that Musk has taken this much of A stance. But again, this is 1 where there can be a lot more chapters to this story. I don't think it's done right

here. Now, Dan says that he could see the stock being down a little based on this news. But when the stock went up 30% after President Trump was elected, based on Elon Musk's close relationship with him, Dan said that was justified. So it was justified. The stock went up 30% specifically because of this close relationship. But as that very same relationship implodes, it's not justified that the stock go down

as much. Now, next, we get the instant reaction from Gene Munster on the same incident. Gene Monster, if you've forgotten, is the person where everything is bad for Google, everything is good for Tesla. So this might be a true test. Is this in fact, finally, something that's not good for Tesla, something that is good for Google? Well, we'll see. I think it was an overreaction. And ultimately Andrew really hit the pressure point on the head. And I just want to zero in on

that. And when you think about AI and this arms race, I mean, undoubtedly this the new frontier in terms of global power and the physical AI piece is 1 manifestation of that. And the most obvious example that is going to be with autonomy. So just to kind of play this forward, let's take the position that Trump is more punitive to Elon. It makes it more difficult for autonomous and then we look around and we see autonomous vehicles in China everywhere.

I'm fast forwarding one to five years from now and in Europe and the rest of the world. It would be a little bit odd, I think for this personality blow up to really slow down that pace of innovation. And so ultimately, I think that what is best for the country is for autonomy to move forward. And I think that that means that this is going to continue to move forward obviously comes in a big time with Tesla next week and and what we're going to hear from Austin.

Now keep in mind, Elon Musk just severed his ties with the president, blew up this relationship. The month that Tesla supposed to launch robo taxi vehicles, the very month of it. And both Dan Ives and Gene Munster saying that this is no big deal, the stock doesn't really deserve to be down at all. They're kind of shrugging this off like it's really not a big event and Tesla and robotaxi will move on with or without

Trump's approval. In terms of what Gene Munster says specifically here, that robotaxi is happening in China, it's going to happen in the United States. That is true. There are companies doing it in the United States right now. Tesla's not the only company that's in the robotaxi industry. I understand the effort that these Tesla investors want to do to downplay the events, but what was the purpose of this? What does Elon Musk and Tesla gain from blowing up this relationship?

Where's the upside? Where's the tactic behind it? He severed a relationship with the most powerful man on earth that holds regulatory approval the month before launching A robotaxi network. What is the purpose of doing so? How is that good for Tesla stock? And in the process, another thing that I'll mention is this isn't just between a relationship of Elon Musk and Trump. This is also blowing up a relationship between Elon Musk and Trump fans.

Millions of people that really like Trump that will side with Trump over Elon. Now they're not going to be looking at Tesla as keenly as they were before. Elon Musk has already damaged the relationship between the Tesla brand and Europe. Many European countries, many citizens there refused to buy Teslas, which were selling well specifically because of Elon Musk's behaviour and rhetoric.

And now after blowing up a lot of relationships with the more liberal side, left-leaning people, especially in Europe and some in the US, he seems intent on doing that with people on the right in the United States, severing his relationship with a key figure, someone that has a lot of power and influence, and with many of his millions of fans in the process. So I asked the Tesla investor again, what is the purpose of

this? Elon Musk seems intent to destroy relationships across the world with many people. If that's not the intention, that's at least the outcome. And I don't see how this is good for either regulatory approval needs, key relationships, or the brand of Tesla. Overall, I see this is a massive diminishing of the brand of Tesla. Another event that will take time to figure out, time to heal. The same thing that investors in Tesla have been waiting for for

years. They've been waiting and waiting for things to get better and approved for this company. And Elon Musk, because of a petty disagreement, is in the process of pushing that in the wrong direction. Some people suggest that my commentary is negative on Elon Musk because I just have some big bias against them, or that I hate Tesla and that's not the case at all. I don't hate Elon Musk or Tesla. I'm commentating on events.

I didn't force Elon Musk to wake up yesterday and cause a feud and implode a relationship with the most powerful man on Earth. That wasn't my doing. He chose to do that himself. I'm looking at the evidence and observing what's going on when I look at what Elon Musk is doing specifically with Tesla. I would be very upset if I was a Tesla shareholder. He's putting his own personal endeavors in feuds above the company, above the company and its millions of shareholders.

And the same could be said for any stock that I own. If I looked at any company that I owned, any single one of them, and the CEO's decided to get in a personal spat with the president, insulting them and burning bridges. Especially if those CEO's worked in industries that rely on regulation, that would be upsetting. I'd be highly critical of them. People would say, Joseph, you're not saying complimentary things about that CEO. And of course, I wouldn't because that's not what a CEO

should be doing. I like my CEOs getting along with regulators. For example, we have a new holding of mine, Equifax, which the CEO recently had a meeting with a key regulator, Bill Polte, This new figure that's over housing and especially focused on closing costs. He met with the CEO of Equifax. He says. I had a good meeting with the CEO of the credit Bureau Equifax. It was super constructive.

I appreciate his approach. We want to be invisible to companies as long as we enforce our statutory and legal obligations. Some companies and their CE OS make it easier than others. This is what I like seeing. I like seeing my CEO do the right thing for the shareholder. They're trying to make business run smoothly. They're trying to get the regulators on their side. That's what me, the shareholder, is investing in the company for. That's what we're paying the CEO for.

Now, if the CEO of Equifax was insulting Bill Poltay through posts online and trying to destroy this relationship of someone that directly regulates the company, that would be upsetting. I'd be very critical of the CEO. But that's not what most CE OS do. So to be clear, the Tesla investors that say that I'm biased against Elon Musk, the reason that I'm uniquely critical against many of the things that Elon Musk does is because Elon Musk does a lot of things to be uniquely critical

about. If that wasn't the case, I would not be focused on him at all. But blowing up the relationship with the president on the onset of the robotaxi release is something worthy of criticism. Now moving on, we get to this news of EU payroll. It finally came in.

This was something that we looked at the news from ADP. They give us some insight, some bit of data, but it actually came in better than expected. US payrolls gained 139,000 in May, which points to gradual moderation. Now, again, these aren't spectacular numbers, but they're better than expected. The figures may help temper concerns that companies are quickly ratcheting back employment as they contend with higher costs related to tariffs and prospects of slower economic growth.

President Donald Trump's decision to pause some of the more punitive import duties, including those on China, has helped lift sentiment among the businesses as well as consumers. So this is what I was talking about in the most recent episode, that this is all lagging data and lagging sentiment. Things were really gloomy in the month of April for businesses. They didn't want to hire anyone. They felt like it was time to turtle in.

But a lot of that sentiment has changed from from being very gloomy to now being far more optimistic. If you ask those very same business leaders, they feel a lot better because a lot of the the rates, a lot of the tariff

rates have been lowered substantially. This is welcome news that makes it less likely we'll see a recession this year. Now, we also had the earnings report of Lululemon yesterday after market close. The stock is down 20%, down $65. Let's go ahead and take a look at the reasons why directly from the management. We can bring this up on Qualtrim. We have here a transcript summary.

We have the company now growing revenue by 7 percent, 8% on a constant currency that fills a little slow 7% growth. That's because it is Lululemon was growing really fast and now the growth is decelerating rapidly. Their guidance is now for five to seven and seven to 8% growth in the 53rd week. They're basically saying that they're now growing in this mid single digit rate, very slow growth for a company like Lululemon. Now I've looked at Lululemon stock for a long period of time.

It's one that's shown up a lot because over time it's actually grown at a fast rate. They save a lot of money because they don't do a lot of marketing. You're not going to see advertisements for it. It's all through word of mouth. It seems like it's an incredibly strong brand, very high end. But I've seen some significant problems with companies like Lululemon and any brand focused company. It's virtually the same reason that I I don't buy Nike stock. If we look at Nike stock, this

is a Bill Ackman investment. It's one that's gone through a big sell off. Nike's down 35% over the past year. It's attracted a lot of value investors, a lot of compound quality investors. But I don't like investing in companies where the Moat of the company is primarily through its brand value.

Brand value is a Moat and it can be powerful at times, but I think it needs to be combined with many other types of moats like network effects, like how embedded the product is, like switching costs, all that type of stuff. Even though Lululemon makes these high end yoga pants and all the stuff that people like, there's now many competitors to Lululemon, many other companies making also high end clothing, and they're undercutting their pricing.

You have companies like Aloe Yoga, Viori, Athletica, all

these new brands popping up, gaining market share. For that reason, I continue to avoid these type of companies. Now we finally get to the news story that Amazon is in the robotics game. In this case, they're in the humanoid robotics game. Amazon is reportedly training human robots to deliver packages.

The Information reports that Amazon is developing an AI software that will enable robots to operate as package delivery workers that are ferried around in Rivian electric vans and will soon be ready to start real world testing at a new facility. Citing an anonymous source involved in the effort, The Information says that Amazon has almost finished construction of an indoor humanoid park at one of their retail giant San Francisco offices that roughly it's roughly the size of a

coffee shop. The obstacle course reportedly contains 1 Rivian van for training purposes, with Amazon aiming to have the humanoid robot quote hitch or ride in the back of Amazon's electric Rivian vans and spring out to deliver the packages. The report coincides with Amazon launching a new agentic AI team that's helping develop technologies that willpower robots, quote, operating in Amazon distributions and logistic hubs.

In a statement to Silicon Valley, Amazon says that quote, instead of rigid specialized robots, we're creating systems that can hear, understand and act on natural language and commands, turning warehouse robots into flexible, multi talented assistance. Now this is something that is not only not surprising, but something that I have been saying for years with Amazon. Amazon is the preeminent, leading, biggest robotics company in the world by far, and

there's not a close 2nd place. A lot of people talk about Tesla being the leading robotics company. A lot of people say that's the robotics, AI robot play. I think it's Amazon, and I've held this position for a while. Amazon has ample experience creating robots. They literally have 750,000 robots working in their warehouses. We've seen footage of these very specific robots, these little mini Waymo machines that glide

around the warehouse floors. They pick up different, different shelves of products and they bring them to the picking station. Now that robot was very specific and Amazon is broadening the capabilities of robots. Now there's ones that resemble a bit more of a human and they say that they can actually feel what they're grabbing. That's how they describe it. They get actually sensor feedback from what they're grabbing.

They can see how it feels and determine how much pressure apply if the product slipping and so on. To me, this looks a bit more humanoid. And here we have news that Amazon is now actively trying to create robots specifically for delivering packages from Rivian vans to the house. Now, this is an interesting application of Amazon because right now we look at the retail business as being very low margin. That's the word repeated from retail.

Part of the reason why is it's expensive to deliver all those items every single day, multiple times a day to the same house. To hire hundreds of thousands, in fact around 400,000 delivery people to deliver those items from the vans to people's homes. If Amazon was to theoretically replace these workers with robots that jumped out of a van and did the delivery themselves, they would no longer have to pay around 400,000 people.

They could save on lunch breaks, they could save on insurance, people getting hurt, taking time off staffing, training, everything associated with hiring a human. Humans are far more expensive than maintaining robots. We know that through ample evidence. Over time, this is an opportunity for Amazon to have enormous margin expansion in their primary business, of which

they are by far the largest. So just this little news piece, the Amazon is actually testing this, looking at humanoid robots to do delivery is substantial. And when we're looking at this, again, part of the limiting factor of these type of robots has not been the physical technology. The physical technology has been very strong, very good for a long time period. We can make the hydraulics and we can make the machines work well. The difficult part is the software, but AI is helping to

solve the software equation. Amazon can infuse the physical hardware with their AI models, train it on how to do these deliveries, how to make it from the van and walk up to the porch, not run into anything, not bump into anything, have lots of safety protocols in the process, and in doing so, raise the margins of the company. So I think this is actually potentially huge news for Amazon.

I'll be following the story. It's not the only reason to get bullish on Amazon, but I think it's one more. That's going to be it for this episode. See you in the next.