As the economy teeters on the brink of disaster, a seasoned market prophet is sounding the alarm about Elon Musk’s risky play with government finances. With billions at stake, can we afford to ignore the warning signs of an impending economic fallout?
The 2008 financial crash was a wake-up call for many, and one individual who predicted it is now sounding the alarm about another potential economic disaster. Danny Moses, who gained fame from betting against mortgage-backed securities before the ‘2008 financial crash‘ , has warned that Elon Musk’s actions are putting the economy at risk.
Elon Musk is a South African-born entrepreneur, inventor, and business magnate.
He is the CEO of SpaceX and Tesla, Inc., and has become known for his ambitious ventures in space exploration and sustainable energy.
Musk's net worth exceeds $200 billion, making him one of the richest people in the world.
He has also been involved in various other projects, including Neuralink and The Boring Company.
Musk is a graduate of the University of Pennsylvania and holds a degree in economics and physics.
The Consequences of Cutting Federal Spending
Moses believes that the impact of cutting federal spending is being underestimated by many. ‘I think we are underestimating the impact to the economy of the cuts we’re making at the federal government,’ he said in an interview on CNBC’s program ‘The Exchange.’ Moses pointed out that when federal spending is not used for critical infrastructure, state revenues, or financial support, it can have a negative effect on the economy.
The Role of Private Sector Contracts
Moses emphasized that cutting federal spending is not just about reducing expenses, but also about contracts with private sector companies. He warned that small businesses and legitimate contractors may be forced to make difficult decisions due to reduced government funding.

The private sector plays a crucial role in economic development by driving innovation, creating jobs, and stimulating growth.
According to the International Monetary Fund (IMF), the private sector accounts for approximately 70% of global employment and 80% of global GDP.
In many countries, the private sector is also the primary source of foreign exchange earnings and investment.
Effective policies that support 'entrepreneurship, trade, and investment' can help unlock the full potential of the private sector.
Market Uncertainty and Consumer Confidence
Trump’s back-and-forth on imposing costly tariffs on key trading partners has added uncertainty to the already anxious economic climate. Moses believes that we are being overly optimistic about how this will play out. He predicted that when first-quarter earnings reports come in, there will be signs of a market slowdown and a hit to consumer confidence.
The Impact of Government Cuts on Elon Musk’s Companies
Musk’s companies, such as SpaceX, have received over $38 billion in government contracts, loans, subsidies, and tax credits. However, Moses pointed out that this funding is not just for SpaceX but also for other enterprises led by Trump’s confidantes. The reality may be different for these companies, and Moses warned of a potential faltering economy.
The Larger Picture
Moses’ warning about Elon Musk’s actions highlights the importance of considering the broader economic implications of government spending cuts. As one who predicted the ‘2008 financial crash‘ , Moses is sounding a clear alarm about the potential consequences of Musk’s policies.