Trump 2.0: winners, losers and Elon

One scoop to start: Private equity groups Silver Lake and Shore Capital Partners have struck a deal to create one of the biggest US veterinary care groups valued at $8.6bn, with ambitions to further consolidate a sector historically dominated by independently-owned businesses, said people briefed on the matter.

And a great listen: Private equity firms have recently been doing something that seems like the opposite of their cut-throat image: giving equity to the ordinary workers at the companies they own. DD’s Antoine Gara explains how these payouts make business sense for the private equity firms on this week’s Behind the Money podcast.

In today’s newsletter:

• Corners of Wall Street cheer victory

• Democratic backers grapple with loss

• Elon Musk’s political ‘star is born’

Betting on Trump

Wall Street had a lot on the line this US election cycle.

Private equity giants had hoped lucrative tax breaks made in 2017 would stay in place. Banks wanted to loosen up capital and liquidity rules. Dealmakers prayed that the recent fervour behind antitrust regulation would be once again restrained.

The return of Donald Trump — and Republicans possibly controlling both houses of Congress — promises to fulfil many of the changes that financiers had yearned for, paving the way for a 1980s-style golden age for deals fuelled by the marriage of Wall Street and Silicon Valley.

During his victory speech in the early hours of Wednesday morning, that’s exactly what Trump called it.

“This will truly be the golden age of America, that’s what we have to have,” he said.

Big banks are expected to be among the beneficiaries, with carte blanche to undertake the consolidation many chieftains yearn for. Their investment banking divisions are likely to ride the tailwind of an M&A rebound.

Meanwhile, a cleaning of the house inside government agencies is expected to water down regulations.

Potential agency heads are expected to be allies of banks, not antagonists. The largest banks in the US saw their shares soar. JPMorgan Chase and Citigroup’s shares rose 11.5 per cent and 8.4 per cent, respectively.

Shares in private capital groups such as Blackstone, Apollo Global and KKR rose to new records, signalling the market’s belief that their ascent into the mainstream of finance will only accelerate.

While some tech scions backed Kamala Harris, those who broke ranks will surely be rewarded by a Republican White House.

Billionaire venture capitalist Peter Thiel cultivated and bankrolled JD Vance to the Senate in 2022, eventually leading him to the presidential ticket. Tech investors Marc Andreessen and Joe Lonsdale also supported Trump.

The stocks of government-backed housing agencies Fannie Mae and Freddie Mac, a tantalising arbitrage for many hedge funds, soared on bets of their privatisation.

The new administration’s cabinet seats and other key positions are likely to be filled with billionaires that cater to the strongest urges of Wall Street. Some of the names being batted around include hedge fund managers Scott Bessent and John Paulson.

Harris backers nurse losses

While the presidential race was purportedly on a knife’s edge for months, as ballots rolled in on Tuesday night it was apparent Trump led by a healthy margin in many swing states.

For Democratic backers, the so-called red wave was painful politically. But the record-breaking amount of money brought in means it was also painful financially.

Harris outraised Trump through groups including the Democratic National Committee and other vehicles. In the end, she raised more than $2.3bn and spent $1.9bn compared with Trump’s $1.8bn raised and $1.6bn spent, according to final filings in mid-October.

One real estate executive who backed Harris’s campaign said his peers weren’t worried about what Trump’s victory meant for business. Instead, it’s the country’s longer-term stability he’s thinking about — corporate America’s success relies on a healthy democracy.

“Most of the people that I know in business are just leery of Trump,” he said. “Not necessarily for business reasons, but for all the other reasons that could impact business, like international relations, Nato membership and trade.”

Harris courted Wall Street and the corporate world with zeal.

Many executives viewed Joe Biden as hostile to business with appointees such as Lina Khan at the Federal Trade Commission and Gary Gensler at the Securities and Exchange Commission.

Harris tried to convince them that her time in office would be different. In October, her efforts seemed to be paying off, with an outside spending group called Business Leaders for Harris unveiling its own nationwide campaign.

Prominent executives such as LinkedIn co-founder Reid Hoffman, entrepreneur Mark Cuban, Netflix co-founder Reed Hastings and General Catalyst chair Ken Chenault signed on.

On Wednesday, DD tried to look up the list of other chiefs that had signed on to the initiative. It appeared the group’s website had already been taken down.

Musk’s empire extends to the White House

Elon Musk wryly mused about presidential candidate Donald Trump in an interview last month with former firebrand Fox News commentator Tucker Carlson: “If he loses, I’m fucked,” he said.

On Wednesday morning, it became clear Musk had bet on the right horse. “We have a new star,” Trump said in a shout-out to his biggest donor in a speech claiming election victory. “A star is born. Elon Musk.”

After voting for Democrats Barack Obama, Hillary Clinton and Joe Biden, Musk cemented his move to the right by endorsing Trump hours after the candidate survived an assassination attempt earlier this year.

The South African-born serial entrepreneur shelled out more than $100mn in donations to his pro-Trump group, America Pac, and sported a black “Make America Great Again” cap when addressing the crowd at a rally last month in Pennsylvania.

Trump’s charge back into the White House marks a new echelon of power for Musk, who’s already the world’s richest man with a $260bn fortune.

Soon, he could have a formal role in the White House. Musk’s proposed role in a new government agency coined Department of Government Efficiency would put him in a position to recommend sweeping cuts to what he deems a “vast federal bureaucracy”.

And that “federal bureaucracy” regulates his sweeping business empire, which includes Tesla, social media platform X, space technology company SpaceX and neurological chip-implanter Neuralink.

“I liken [regulations] to referees on a field,” he said on a live-streamed Q&A while flying to Mar-a-Lago to watch the election results with Trump. “You don’t want to have more referees than players,” he said. “That’s crazy.”

Present through the campaign has been Musk’s prolific use of X. On Tuesday he posted a doctored photo of himself carrying a sink into the Oval Office. (It was a callback to a similar photo he posted after buying X for $44bn with the tagline “let that sink in”.)

“I don’t think this race would even be close if it wasn’t for what Elon Musk is doing with X and showing people what’s going on,” Donald Trump Jr said in a podcast this week.

Job moves

• Phoenix Group has named Nic Nicandrou as its new chief financial officer and as an executive director of the board, beginning in December. He replaces Stephanie Bruce, who worked in the role on an interim basis. Nicandrou previously ran Prudential’s Asia and Africa division.  

• O’Melveny has hired David Aaronson as a partner with the firm’s energy group in Houston. He previously worked for Orrick.

Smart reads

Unleashed Trump’s landslide victory in battleground states will embolden him, the FT reports. What will his second term bring?

Healthcare fallout Many business sectors will feel the effects of Trump’s return to the White House, Lex writes. There will be a new schism among US health insurers between the haves and have-nots.

Lunch throwback Long before he seemed close to having a role in the White House, Elon Musk sat down with the FT’s editor Roula Khalaf for lunch at his favourite Mexican restaurant. Seems like a good time to revisit their chat.

News round-up

CME customers criticise futures exchange after it wins approval to also act as broker (FT)

AstraZeneca’s top China executive detained by authorities (FT)

UniCredit and Commerzbank report diverging earnings (FT)

Reeves insists she will not be ‘coming back with more tax increases’ (FT)

JD Wetherspoon warns of near-£60mn jump in taxes and costs following UK Budget (FT)