Why We Need to Pay Attention to Elon Musk Again

15:33Peter Kafka:Yeah, one set of things exists today and the other things could exist one day. So to bring us all the way back to the IPO, when you imagine them selling the story, are they selling the story of we have a great business today and who knows what could happen in the future? Or is it, let's be clear, this is all about future and you're just going to come along for the ride. And people told us that Tesla couldn't support the valuation it had for a car company. And we said, it's not a car company. It's a tech company. Just trust us. And maybe that's worked. Maybe it isn't. But it has worked financially for us.

16:04Max Chafkin:So, I mean, you know, we're still in, Elon Musk is still selling this to investors. So I think to some extent, this is an open question, but I think it's pretty easy to answer this because he's done the exact same thing with Tesla. So my expectation is he will say we have a dominant space business, which is true. He has a near monopoly in the launch business.

16:25Peter Kafka:When he threatened to stop working with the, when he had his butt dusted up with Trump, and we'll talk more about that later, there was a period where Trump said, oh, we're going to cut off your contracts now, Elon. And Elon said, all right, well, fine. I'm no longer going to work with NASA and good luck getting your satellites. And then there was an immediate like, oh, we didn't really mean that. We're going to keep working together because literally the US government depends on his business at this point.

16:47Max Chafkin:Yeah, it would be hugely disruptive. It's not like they couldn't. They could, but it would be hugely expensive, hugely disruptive, and it would require us to make nice with the Russians, which is the other way you can get stuff to and from the International Space Station. He's saying we have a dominant business in launch. We have a very good and fast-growing business in Starlink. Who knows how big that could get? I think there are real important questions that you could ask about how good this Starlink business is. These low-Earth orbit satellites essentially fall back down. They burn up. They won't land in our heads, but you have to keep sending new satellites up pretty much continuously to keep the Starlink network going.

17:35Max Chafkin:It's going to be very expensive to maintain. There are also questions about the bandwidth, like how many customers can this network support and how much better can the technology for sending internet to individual people get so you could support instead of 9 million people, maybe 90 million or 900 million. But he's going to say this is a big and growing business, which is true. And then you have this essentially multi-trillion dollar opportunity. And that's kind of that zone is where the Elon Musk enthusiasts are sort of focusing. And it's where all the attention is with Tesla. It's why you look at Tesla, his car company, it's had a disastrous couple of years.

18:18Max Chafkin:It was supposed to be this super fast growing electric car company. Elon Musk makes nice with Trump, becomes kind of a right-wing influencer troll, and alienates a huge number of Tesla's customers, turns this fast-growing car company into a shrinking car company. Growth has kind of leveled off. Maybe it's taking up a tiny bit, but it's lagging the rest of the electric car industry. He hasn't released any new products. The company, like by normal sort of Wall Street metrics, if this were like a normal company.

18:51Peter Kafka:He said, here's your car company. We're going to evaluate it based on the way we evaluate any car company.

18:56Max Chafkin:It would be worth way less. You know, it probably would be worth more than GM and Ford. But you'd have an argument about it because it makes fewer cars than the big car companies. But with Tesla, everybody's focused on, number one, robo-taxis, this kind of futuristic technology that has essentially been a futuristic technology for like half of my journalistic career, more than half of my journalistic career, for like 15 years. and is still kind of out there in the future somewhere. And now humanoid robots. Tesla has a robot that Elon Musk has said is going to be everything from a worker in his factories all the way to your friend.

19:37Max Chafkin:Your buddy. Your buddy, he calls it. You're not going to need normal human friends because you've got your optimist. And again, they haven't sold any of those. There are huge questions about the economics of that, whether anyone wants a robot friend and so on. But that is where investors are.

19:52Peter Kafka:The common theme here is there's a thing that exists that you could evaluate as a business, whether it's Tesla or SpaceX. And that's one that's one thing. And then there's the future. And again, all companies sell themselves on the future. But Elon takes it to a crazy extreme. I'm going to I'm going to make the most audacious claims and prognostications. I'm going to constantly change what those prognostications are. you may rightfully come back and say, hey, you've been promising robotaxis or self-driving cars for years and years, decades now. You're not delivering and you go, well, that's who cares?

20:27Peter Kafka:Yeah. And people are comfortable with that, at least as investors.

20:30Max Chafkin:Well, and as you know, he's not the only one. I mean, the other day, Melania Trump walked out in the White House with a robot from a competing company figure, I believe. But the thing is, normally when Silicon Valley guys say, I'm going to have data centers in space or humanoid robots, that's worth something. But there is a very, very high chance that they'll fail. So the valuation is marked down from the potential$10 trillion opportunity to something way lower. And Elon, because he has this huge enthusiast base, the retail shareholders in Tesla, it's a much higher percentage than a normal company.

21:08Max Chafkin:He is like a mom, pa, investor, Robin Hood people, basically. And yeah, and mom and pop and, you know, Robin Hood guys. It's it's around 40 percent. And he actively courts those folks. He explicitly courts them. It is a huge part of how he runs the company. You know, Tesla is sort of like half a normal industrial company and half a meme stock. It's not as meme stocky as AMC or something, but it's definitely like way more meme stocky than Toyota. A lot of investors are just buying it because it's fun, because they like Elon. And so they are not doing a sophisticated financial analysis.

21:50Peter Kafka:And also stock goes up. Yeah, and stock goes up. And so at some point, I mean, I've talked to people who are grown up investors and they say, it doesn't really, I can't justify investing in Tesla, except that it would be irresponsible for me not to do this with my client's money because the stock keeps going up. And for me to say, the valuation isn't supported by the tech and the business, I can be right, but I actually need to be in this company. And that is why that company has continued to thrive as a stock well after all the meme stocks we saw collapse after the pandemic and why AMC is back to being a nearly bankrupt theater company, et cetera.

22:27Peter Kafka:Tesla has remained undamaged by any of that.

22:30Max Chafkin:Yeah, absolutely. And that is the bet with SpaceX as well. We've gotten some reports that Elon Musk is going to try to get as much as 30 percent of the initial shareholder base to be retail investors. That's like way higher. I think the normal percentage is about 10 percent, not as high as Tesla's retail shareholder base. But the idea will be to take this amazing fundraising engine that he built with Tesla, which combines his celebrity, his role as kind of a, you know, like a political influencer and the business celebrity. And he is able essentially to move Tesla's stock price almost at will.

23:08Max Chafkin:I think at some point this will break down because you said, Peter, that people feel like they can't afford to invest in Tesla because the stock has just been going up and up and up. But, you know, you look at the stock over the last five years. That's not quite true. I mean, it is basically flat over that period of time. Now, if you invested in Tesla in 2018, you have done incredibly well. And there are moments in there where the stock is very swingy. So depending on when you buy it, maybe you've done well. But there are also people who buy into this thing and lose money, just like any other kind of meme stock.

23:42Peter Kafka:We'll be right back with Max Chapkin. But first, a word from a sponsor.

23:48Max Chafkin:Fox News is now streaming live on Fox One. When it matters most, turn to the voices you trust. We go beyond the headlines, bringing you the stories you won't hear anywhere else. Live coverage, sharp analysis, real perspective. at home or on the go. Stay connected when it counts. Stream Fox News on Fox 1. Download today.

24:18Max Chafkin:For the last 10 years, everything in American politics has basically revolved around one man. And as a political journalist who came of age during Donald Trump's rise in 2016, I've had a front row seat. I am officially running For president of the United States, it's going to be only America first. America first.

24:43Peter Kafka:Thousands of supporters of President Trump stormed the U.S.

24:46Max Chafkin:Capitol building. But is it possible to talk about politics without talking about Donald Trump? That's the question I'm going to ask in our new show from Vox. The idea of like a post-Trump or not exactly Trump-focused show can exist because he's not really driving any agenda items. It really does feel like so reactive. You know, I think this Iran thing is also going to cause a big split in the GOP. So far, it doesn't among like people who say they're MAGA voters are still with Trump. But like for the first time, you see on a major issue, open opposition from the start of this war. I'm Estet Herndon and welcome to America Actually.

25:24Max Chafkin:Hi, I'm Brene Brown. And I'm Adam Grant. And we're here to invite you to the Curiosity Shop. A podcast that's a place for listening, wondering, thinking, feeling, and questioning. It's going to be fun. We rarely agree. But we almost never disagree. And we're always learning. That's true. You can subscribe to the Curiosity Shop on YouTube or follow in your favorite podcast app to automatically receive new episodes every Thursday.

25:52And we're back.

25:53Peter Kafka:Elon Musk has been able to raise a gazillion dollars for SpaceX. Lots of the people, lots of the institutional investors who are in SpaceX were already in Tesla. They basically say, look, we'll back Elon no matter what. He's already made us a gazillion dollars. Of course, we're in there. Elon Musk is the world's richest man. He has this publicly traded company, Tesla. Why is he taking another company public? What does this accomplish for him?

26:17Max Chafkin:It's such a good question because for years, I brought up this sort of pivot on Mars. For years, Elon has said, I don't want to run another public company. He famously tried to take Tesla private a few years back. That was the 420 funding secured. He has been adamant that SpaceX should not have to live under the scrutiny of being a publicly traded company. I think there are a couple of things going on. And I think this is not unique to Elon Musk and SpaceX. it is a good time to take a company public right now, especially if you're an AI company, especially if you are a Trumpy kind of company. You know, we've seen this huge run up.

26:59Max Chafkin:The markets have given it back a little bit. But, you know, it's a hot market if you're in AI. It's a hot market if you're connected to the most powerful person on the planet, which Elon Musk is. And so I think it's opportunistic. And I think it's about trying to get this thing onto the public market and into this amazing financing engine that he's built for himself, you know, before the market shifts, before maybe we see a pullback on AI or, you know, Democrats are currently favored to retake the House. They may retake the Senate. We saw these kind of vibes on Wall Street, this kind of Trump trade thing happen.

27:39Max Chafkin:And I would not be surprised if if you start to see a swing away from that, we will see kind of a Trump sell. Right. So he there are multiple factors that could put pressure on the stock market if Democrats retake power. And so I think it's a it's a good time. I think you could also make an argument that he increasingly like doesn't have a choice that the amount of money that he is trying to raise is so big. It would be hard to do that.

28:07Peter Kafka:But why does does he need to raise the money for the SpaceX business? Does he need to raise the money for the AI business, which is very, very capital intensive? And again, there's companies like OpenAI and Anthropic, which are generating many, many billions in revenue, are still struggling to keep up to fund that. He doesn't have that revenue coming to AI. Is this is this something he needs to do to keep that business going?

28:33Max Chafkin:If Elon Musk were a different person and he had just sort of limited himself to being a NASA contractor, he would not need to. That part of the business is probably pretty profitable.

28:44Peter Kafka:So SpaceX could stay private and functional.

28:46Max Chafkin:Yeah, and just be kind of the way he used to frame it, as this pseudo-philanthropic, I just want to help humanity get to the stars and maybe be a defense contractor along the way.

28:56Peter Kafka:And yes, this is an incredibly valuable business, but I don't need to take it public. There's other ways for me to extract value from it.

29:01Max Chafkin:What he has said is that if he does that, if he just limited his ambitions, it would take too long. We wouldn't be able to get to Mars or the moon, you know, in our lifetimes. I think there are still questions whether we'll see it in our lifetimes, even with the super optimistic version. But what he's saying is to do this, we need to, you know, hypercharge it. We need to have a base on the moon. We need to have much bigger rockets. So SpaceX is building this much larger rocket called Starship that still hasn't really worked. Like they've had sort of partial successful tests, but it hasn't done what it's supposed to do yet.

29:35Max Chafkin:And that is necessary to make Starlink economical. So Starlink is not economical yet, I don't think. And certainly XAI is losing, you know, huge amounts of money, just like OpenAI and Anthropic. So he, because of his ambitions, maybe if you're an Elon fan, you say because of his idealism, whatever, he's just trying to make it as big as possible. And he's not, you know, the same thing with Tesla. If he just contented himself to run the world's most successful electric vehicle company, you know, Tesla would be a great business. Tesla's car business is great.

30:14Peter Kafka:He runs a publicly traded company, Tesla. He's going to have a second one, SpaceX, and he runs them in his Elon way. So they are constantly sort of they're commingling employees and financing and lots of good governance. People would say you can't do any of that. And he basically does it. And no one stopped him from doing it. Is there a point where he says, actually, running two publicly traded companies sucks? Why don't I just combine them all into one mega company?

30:37Max Chafkin:I mean, he's already floated that that idea. There were there were reports in addition to the reports about XAI and SpaceX merging. There were reports about Tesla and SpaceX merging. So Tesla just had this big event. They are going into the chip business. They're building what he's calling a terafab. Giga was the old thing. Terra is the new thing. A terafab would produce more chips than the world produces in a year.

31:06Peter Kafka:You're going to build the actual facility that makes the chips.

31:08Max Chafkin:Yeah. And this is essentially like a joint venture with SpaceX because the chips are going in. Can you guess where they're going? they're going in the data centers in space. So those two, and guess who's going to work on the, who's going to build this data centers in space? It's going to be Optimus. Your friend who's bringing you coffee is also going to be in space constructing data centers. So in a lot of ways, he's framing the two companies kind of as one company already. And I think that in the long run, there is a high likelihood that if investors don't revolt, like assuming these IPOs go well and assuming Elon Musk's, you know, sort of business celebrity stays where it is, but those are big assumptions, I think they will eventually merge.

31:53Max Chafkin:And I say that not only because these two things are now going to be in business together and their stories are really intertwined, not only because the shared, you know, executive structure, the fact that they have the same CEO, But they will have the same shareholder base. You're going to have the same retail investors who are enthusiasts in Tesla also buying SpaceX. And I think that's one of the big questions about this IPO is like, are there enough of these mega, multi-trillion dollar companies?

32:22Peter Kafka:So we're talking about financial engineering. And then there's what always seemed to be an inevitable breakup. You've got two enormously powerful men with appropriately sized egos or extra sized egos. It seemed impossible they could ever share the same space for any amount of time. And they do break up.

32:40Max Chafkin:Yeah, absolutely. And I think part of it is what you just said. There's an interpersonal dynamic. There's also the fact that Tesla sales were cratering at the time. So I think.

32:49Peter Kafka:So the work that Musk was doing to promote Trump. Was incredibly unpopular with his customers. And in a way, and because I, you know, I focused on Twitter, which became Axe, and you could really see Elon Musk destroying the value of the thing he bought, telling advertisers to go fuck themselves and really pushing away a big core of Twitter users. And to this day, the business has not recovered from it. You can argue that it's still an important platform. That's fine. But he went ahead and basically said, I'm going to emulate this business. I'm going to set it aflame. And I could not do that. I could not say terrible things or upset people, but I'm going to go ahead and do it and didn't care.

33:34Peter Kafka:But with Tesla, it seemed like a lot of what he was doing did directly affect his business.

33:38Max Chafkin:I mean, he was doing what he did to Twitter advertisers, but to Tesla's car buyers.

33:43Peter Kafka:And essentially, particularly in Europe, but in the U.S., people said, I don't want my car to be a billboard for Elon Musk.

33:50Max Chafkin:You think about who buys an electric car. I don't think it's as liberal as you might imagine. There are lots of Republicans drive electric cars, but it's very urban. It's a thing that in suburbs, basically. It's a blue state, blue city kind of thing. And even the Republicans who are buying Teslas are not into the most extreme parts of Trumpism. It was like he was staking out a politics that was so far removed from where his customers were and doing all these incredibly controversial things to the point that there were protests, you know, in front of Tesla stores. Tesla stores were getting like attacked in Europe.

34:27Peter Kafka:And this is why you have Trump and Elon, while they're still buddies, literally putting Teslas on the White House lawn and doing a sales promotion.

34:35Max Chafkin:Well, and then the other thing that happened is in addition to being super unpopular with Tesla's customers, what Elon Musk was doing in government was also started to become clear that it was unhelpful to Donald Trump. And I think that's why Trump starts to push Elon away. You had – there's probably a version of Doge that would have been really popular. Americans like the idea of making their government more efficient. But what Elon Musk was doing was essentially taking government workers and humiliating them. And that I don't think was popular really with anyone except the really sort of most ideological parts of the right.

35:10Peter Kafka:And the thing about coming in and saying we're going to cut a trillion dollars from the budget, which was never going to happen anyway. But if you the point is you come and say we're going to cut massive amounts of the federal government out. You may hate in your mind this part of the government or that part of the government. Or you imagine a government worker is a certain kind of person you don't like. Eventually, we'll get to something you care about.

35:30Max Chafkin:Yeah. And that something is Social Security. There's no way to make those cuts without cutting Social Security. And Musk made a bunch of comments, again, super politically unhelpful, where he called Social Security like the greatest Ponzi scheme. You know, it's the third rail in politics. Anyway, Musk also got involved in this Wisconsin special election where it sort of became clear that his involvement might have been one of the factors that cost the Trump-aligned candidate to lose.

35:59Peter Kafka:So he was the idea of Elon Musk going to Wisconsin and holding these rallies, which were well attended, was actually a net negative.

36:07Max Chafkin:I mean, it's, you know, the story that the Democrats have been telling since Donald Trump's election is about whether you use the word or not is about oligarchy. It's about this kind of like, as they see it, unholy alliance between the corporate class and Donald Trump, where the corporate class is bringing down workers and and like going to Epstein's Island and, you know, doing all this bad stuff. And Donald Trump is getting rich off of it. And Elon Musk, among the opposition, became the avatar for that, the most visible because he spent the most money because he was literally having a sales pitch on the South Lawn of the White House.

36:47Max Chafkin:And so it just became this incredibly toxic thing, not just for Elon Musk, but also for Donald Trump.

36:54Peter Kafka:So this alliance backfires sort of for both of them. And again, not surprising that Trump would move on at some point. What surprised me is, and I follow it closely, but not as closely as you do, is it sort of seemed like Elon Musk seemed to take the advice that everyone was giving him and saying, you should just shut up a bit. Or it's impossible for you to shut up, but you should be less loud. And initially when he left Doge, he held a series of interviews and told everyone, I'm going to be less involved in politics now. I'm going to go back to focusing on cars or whatever it is. And I don't think that's true.

37:31Peter Kafka:But on the other hand, he does seem to have I don't know if it's intentional or not. And you tell me reduced his public profile in the last year.

37:39Max Chafkin:I think his public profile has been reduced. I don't know how much of the like you're right that he said he signaled less involvement in politics. But if you look at his X feed, it's still full of the same racially provocative, politically provocative, sexually provocative. Remember, there was this whole thing where Grok introduced a bot that would non-consensually take people's clothes off. And Elon Musk was kind of on X laughing about that. I think the main thing is that the sort of center of the media universe over the last year has been Donald Trump. and there was a time when that included Elon Musk and now it doesn't.

38:21Peter Kafka:So you think that's you and me in the media and then just regular people said, we are just done paying as much attention to Elon Musk or we're no longer as, I mean, you can only sustain interest in anything for so long and we've sort of had our run with him.

38:35Max Chafkin:I don't think it's the media driving. I think it's people being more interested in the reality show that is the White House than the reality show that is Elon Musk's ex-feed. And as long as Elon Musk is not getting into a big fight with Trump or involved in the Trump show in some way, then he's able to be somewhat under the radar. I also think maybe there's a bit of fatigue. Like how many times can you be outraged over kind of like a white nationalist tweet? I don't know. At a certain point, you're just like, yep, that's that's what he does.

39:05Peter Kafka:Yeah, there's a great Guardian piece that came out in February and just said, we just looked at everything he tweeted for a month in January when he was supposedly low profile and supposedly had maybe learned his lesson about angering politicians and customers. And there's just straight up race war stuff that he's basically publishing every day. And he would argue that it's not that. But most people would look at that and go, this is kind of revolting. I don't know anybody would want to do this, let alone someone who has real power and real consequences for putting this stuff out. But he's gone ahead and done it.

39:36Max Chafkin:Yeah. I mean, I think he has much like Trump, honestly, where he's achieved kind of a place. He has a fan base that essentially looks past the stuff that is norm breaking or weird or troubling or all those things all at once. And they've just decided, yep, that's who he is. And I honestly think for a lot of them, you know, it's part of the appeal. Part of the reason he has this huge base of fans, admirers, investors isn't just that he's, you know, the one tech guy who's doing ambitious stuff. It's that he talks like a normal person. It's like Donald Trump.

40:12Peter Kafka:He doesn't really talk like a normal person, if you hear. But he tells people like you and me, fuck off. Yeah. I don't care about what you have to say.

40:19Max Chafkin:I think, yeah. I mean, first of all, if you've met Elon Musk or seen him on TV, he is not a normal person. He is profoundly awkward. You know, he's unique. I'm just saying he is perceived to be unfiltered. Right. In that same Trumpian way, right? Exactly.

40:34Peter Kafka:Like, I'm going to say what I believe. Maybe it's not what I believe. And maybe it's something I'm going to say. I will say a different thing tomorrow. But this is coming from my head out of my mouth to you. This is what I am.

40:44Max Chafkin:There's incredible power in that. And I also think this skill is arguably less important than it used to be is like Trump. He's really good at Twitter. He's really good at the short form text social network thing. And, you know, that's I think that's part of what led him to buying the platform in the first place. But, you know, he's good. He's good at being a celebrity in 2026. And he's good at leveraging that celebrity to make money and do the things that he wants and attack his enemies and so on. We'll be right back. But first, a word from a sponsor.

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42:23Peter Kafka:I spent a ton of time using Twitter, thinking about Twitter, writing about Twitter, made a podcast about Twitter. I still use it. It seems to me to be less central to discourse than it used to be. Still important. Is it important to him to own Twitter? You know, he explained how he sort of used that to lever himself into an AI company. But beyond that, is it meaningful to him as a business?

42:57Max Chafkin:I mean, we spent – like people who were paying attention to this, especially paying attention to his destruction of Twitter or what felt like his destruction of Twitter for like – what was it? A couple of years thinking like this is the – this is an incredible destruction of value. He's just lighting money on fire just kind of for the fun of it or something. And I think you have to look at it as an incredibly successful acquisition, an incredibly successful business maneuver, not only because he realized, and this was pretty smart, that Twitter's sort of real -time feed would be a good way to build a large language model off of and that if you controlled that, you would have an important asset.

43:41Max Chafkin:Just a big data set.

43:41Peter Kafka:You own it.

43:42Max Chafkin:Big data set that is crucially up to date, right? That's one of the big problems with scraping Google or scraping any other site.

43:50Peter Kafka:The open AIs of the world all need, to some degree, some new information. And in some cases, they have to pay for it. In some cases, they're not able to get it because they're blocked from it.

43:59Max Chafkin:And I don't know. X is way behind open AI and Anthropic. But it still is an important asset. And it's allowed him to get a very high valuation and to pay back the investors who lent him money to buy Twitter. The other thing it did is by transforming Twitter from being kind of this media centric place where celebrities and it was a blue state operation.

44:25Peter Kafka:That's how it's because it was subscale. The people who sold ads for it couldn't say you're going to reach everyone in the world.

44:30Max Chafkin:They said you're going to reach a certain kind of person, probably the kind of person who buys a Tesla or the kind of person who is influential in policy circles or whatever. It was a way to to to reach elites as an advertiser. And he's transformed it into being this right wing social network. And I agree that when you say, well, how influential is Twitter today on the culture? It's it's not very influential at all. Like, you know, TikTok, of course, is like where it's at or even reels. But within conservative politics, it is the dead center of the world still. It is like if you are paying attention to conservative media, Twitter feels exactly like it did like in 2011.

45:10Peter Kafka:And there are other parts of that because Twitter is lots of different things with lots of different people. It is where all of the AI discussion happens, like all the people who are building, investing in AI, that is where they are hanging out. Yeah.

45:22Max Chafkin:And so so it's true that it's become less influential, you know, maybe broadly, but its influence in certain elite areas, including conservative politics. In fact, the areas where like Elon Musk cares about it is arguably more influential. And he is, you know, it's it's elevated him in a way that I think is difficult to imagine. So even today, if you are running for like in a house race or something, you want to raise some money, you want to get on the radar of, you know, big donors. The best thing you could possibly do is get Elon Musk to reply to one of your tweets. I mean, there are probably other things, but that is that's going to be high up there.

46:00Max Chafkin:You look at all these kind of like up and coming right wing politicians. They are they are so online. They are on X, you know, all the time. And anything about like Tucker Carlson, Tucker Carlson essentially got thrown off of Fox News. And his show and went to X, it looked like, OK, that's the end of Tucker Carlson. That's exactly what I thought.

46:20Peter Kafka:I thought that as well. He's never going to recreate the reach that he had on Fox. And if he had any chance to do it, it wouldn't be on Twitter. It'd be on YouTube or TikTok.

46:29Max Chafkin:Now, he doesn't – I mean he doesn't have the broad cultural reach that he once did. But he has a huge audience. And he is all over X too. And, of course, now he's mainly on YouTube because X, as you say, is subscale. But he really used that and sort of used that ecosystem and is central to that ecosystem. Like, I don't think Nick Fuentes is a major force in, you know, sort of political culture in this country without Twitter.

46:54Peter Kafka:No, and there's Nick Shirley, the, I'm not going to put air quotes around investigative journalist, the troll who created the what's going on with the Somalis in Minnesota story last year, which got to, I mean, that became a huge story on Twitter slash X, which led directly to invading Minneapolis, et cetera. So these things have real consequences. We started off by talking about the IPO. We've explained why Musk is so good at financial engineering and also engineering engineering and why this looks to be an enormously successful IPO. What is the downside risk for him if something goes wrong in the next few months and the IPO can't happen or is less successful than he thought?

47:38Peter Kafka:Is this existential for him or is it a road bump?

47:40Max Chafkin:Okay. So one thing, one part of this answer is going to be true about Elon Musk. It has been true before. It will continue to be true. And then another part is specific to this moment. But his empire, as big as it is, as valuable as it is, it is more fragile than I think anyone realizes. It is interlocked and it's dependent on this celebrity and this continued belief that people have that there's no guarantee that that lasts forever. And I think the nature of celebrity is that it doesn't last forever. And so at some point, that will be threatened. And I think we saw a little bit of that with Elon Musk's feud with Trump, where I think as much as it would have been bad for the United States of America if he had stopped supporting the International Space Station, bad for the world too, it would have also been disastrous for his companies.

48:35Max Chafkin:Because getting crosswise with Donald Trump, part of why he's so erratic and why he's always doing these bold things, because he is just – he's being chased by reality always and has been for his entire career. And he's been able to do enough things and build his company and that's part of what's made it an amazing story. The second thing is the market does not feel particularly stable right now. And the way that we're valuing AI companies, I don't think there's any guarantee that that stays stable. And so I think he needs to get this thing public and to be able to do this before either there's an AI bust or an AI correction or whatever or before there's a political shift because a political shift could really hurt him.

49:27Max Chafkin:If you look at the prediction markets, people think that Democrats are likely to retake the House in November, about a 50-50 chance on the prediction markets of Democrats retaking the Senate. If that happens, we're going to have two years of essentially hearings. Democrats won't be able to do that much in Congress, but what they will be able to do is hold hearings about Donald Trump and his cabinet members and possibly Elon Musk. And there is going to be a level of scrutiny on the parts of his empire that are connected to the government that I'm not sure he has had to contend with yet. And that's going to be a challenge.

50:07Max Chafkin:And that's one of the reasons why getting to the public markets, being able to have a bunch of cash, being less dependent on federal contracts would be very good for him.

50:17Peter Kafka:This is a consequential window, and we got the right person to explain why that was the case. Matt Shafkin is awesome. You can read his stuff at Bloomberg. You can listen to him on Everybody's Business. Excellent podcast. And we'll have him back on the show. Thanks, Peter. Thanks again to Max. Great to see him again. Thanks to my producer, Charlotte Silver. Thanks to our advertisers. Thanks to you guys for listening. See you next week.

50:51Peter Kafka:Ryan Reynolds here from Mint Mobile. with a message for everyone paying big wireless way too much.

50:56Max Chafkin:Please, for the love of everything good in this world, stop.

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