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It was simultaneously hard to watch and impossible to turn away.

A bust-up between the world’s richest man and the leader of the biggest economy was always on the cards, given the personalities involved. In some ways it was surprising the bromance between the US president and the “First Buddy” even lasted this long.

But few could have predicted how abruptly things would spiral out of control. For investors and policymakers watching Donald Trump and Elon Musk take whacks at each other, the question was how far they’d go and who would blink first.

The answer would appear to be Musk. Even for a multibillionaire, the break-up has cost him dearly: shares in Tesla tanked 14%, and Musk’s personal wealth dropped by $34 billion. When one user on his X platform advised him to cool off, he conceded that might be good advice.

Trump and Musk in March. Photographer: Mandel Ngan/AFP/Getty Images

That the relationship had soured was clear when Musk hurriedly left his role in the White House overseeing cuts to US government spending. But the two men were purposefully avoiding direct attacks on each other.

That changed suddenly when Musk implied Trump wouldn’t have won the presidential election without his millions piled into the campaign.

The gloves came off, and within hours Musk was told he was “CRAZY” and threatened with losing government contracts. Musk followed by saying he would decommission SpaceX’s Dragon spacecraft ferrying astronauts back to Earth, before backing down again.

He also said, without providing any evidence, that Trump’s name appears in files relating to the late sex offender Jeffrey Epstein.

The spat ensured, for once, it wasn’t a foreign leader caught in the Oval Office cross fires.

German Chancellor Friedrich Merz was a bystander to the cockfight unfolding in real time, surely relishing Trump’s barbs against Angela Merkel, his one-time arch political rival.

As Trump might have said of yesterday’s events, it all made for great TV. — Flavia Krause-Jackson

WATCH: Trump reacts to Musk’s criticism of his proposed tax and spending bill.

Global Must Reads

Trump and Chinese President Xi Jinping agreed to further trade talks aimed at resolving disputes over tariffs and supplies of rare-earth minerals at the heart of tensions between the world’s two largest economies. Trump acknowledged trade ties with China had gotten “a little off track” but said the US is “in very good shape with China and the trade deal.” Additional negotiations would occur “shortly” at “a location to be determined.”

Russian drone and missile strikes killed at least three people in Kyiv and wounded more than a dozen others in a wave of overnight strikes that followed President Vladimir Putin’s vow to retaliate for a Ukrainian assault on Russian air bases. The attacks across Ukraine came hours after Trump said that it might be necessary to let Russia and Ukraine “fight for a little while.” A top Kremlin official, meanwhile, thinks chances are fading for agreeing on a new pact to replace the nuclear arms-control treaty with the US, which expires early next year.

Ukrainian Finance Minister Sergii Marchenko has to keep many balls in the air, including making sure that allies have confidence in where their money and other support is going and ensuring that the state has enough cash to buy weapons and pay soldiers, doctors and teachers. Read our interview here on what it takes to run the finances of a country at war.

Merz came through his inaugural talks yesterday with Trump unscathed, dodging the kind of public dressing down doled out to a number of other global leaders. The German chancellor, who was in Washington to lobby Trump on issues including trade tariffs and backing for Ukraine, appeared to heed advice from a number of European counterparts that he should let the US president do the talking.

Trump and Merz at the White House yesterday. Photographer: Chris Kleponis/CNP

Polish President-elect Karol Nawrocki indicated in his first interview since Sunday’s election that he plans to cooperate with Prime Minister Donald Tusk on some issues. The opposition-backed populist’s victory over a Tusk-backed liberal candidate raised concerns of political instability and is seen as a potential obstacle to the government’s agenda.

UK Prime Minister Keir Starmer’s Labour Party won a Scottish parliamentary by-election, a surprise result that deals a blow to both nationalists and Nigel Farage’s Reform UK party.

Trump and Canadian Prime Minister Mark Carney have been in direct contact trying to reach a trade deal, but the two sides still have work to do to find agreement, sources say.

Australian Prime Minister Anthony Albanese has signaled scope for a potential deal on US beef imports as part of tariff negotiations with Trump.

Portugal is considering whether to sweeten its golden-visa program and make a special tax regime for expatriates even more attractive, less than two months after neighboring Spain scrapped a similar arrangement.

Can Europe defend itself? You’re invited to our virtual briefing on the geopolitical climate and industrial context that will shape the next decade, featuring an exclusive presentation by Bloomberg Intelligence plus insights from Bloomberg journalists and industry experts. Join us on June 18 at 3:30 p.m. BST. Register today

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Chart of the Day

Trump’s policies have cut into travel worldwide. The simmering trade war, the crackdown at the borders and the rollback of LGBTQ rights — capped by a ban on visitors from a dozen countries announced this week — have led to tens of thousands of canceled trips. Here’s a look in charts at the toll the president has taken.

And Finally

In 1957, Reverend Murdoch MacRae traveled from a remote Scottish island to Washington to challenge US tariffs on woolen imports that threatened his parish, known for making Harris Tweed. Almost 70 years later, his successful mission to combat American protectionism has been undone by Trump, the son of a fellow native of the island. Read our story here on how the tweed industry is attempting to adapt.

Harris Tweed weaver Iain Martin working on his loom in Scotland’s Outer Hebrides. Photographer: Emily Macinnes/Bloomberg

Pop quiz (no cheating!). What is the latest country set to join the Euro common currency bloc? Send your answers to balancepower@bloomberg.net

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