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Trump vs. Silicon Valley

11/11/2016
By Charles Payne, CEO & Principal Analyst

It’s no secret there is no love lost between Donald Trump and Silicon Valley, but the animosity has reached a new level, as major powerbrokers are now working to get the nation’s most populous state to secede and form a nation called ‘New California.’

Shervin Pishevar is a very successful venture capitalist who is currently working on the Hyperloop transportation system with Elon Musk.  His home was used to host a George Clooney fundraiser for Hillary Clinton that raised $2.3 million.  When it became clear on election night that the GOP nominee would win, Pishevar began his 25-page proposal on California’s secession. 

Other well-known Trump adversaries such as Mark Zuckerberg and Jeff Bezos were making nice with the next President of the United States via positive comments on social media. However, many believe they are gearing up for battles as well.  

This isn’t the first time we are hearing about California’s secession. It has come up in the past; it was usually concentrated in the northern part of the state, which is the only region that voted for Trump on Election Day.  

California

PARTY

VOTES

PCT.

E.V.

Hillary Clinton

Democrat

5,488,261

61.5%

55

Donald J. Trump

Republican

2,969,532

33.3

This time, the talk is backed by big money and overwhelming opposition to President-Elect Trump among state’s voters and tech moguls. In fact, California has the world’s sixth largest economy - one could argue who has the most to lose.

I know this kind of talk always fades, but it’s serious enough at the moment that it is impacting the share price of big tech names:

  • Amazon (AMZN) -3.84%
  • Facebook (FB) -1.94%
  • Telsa Motors (TSLA) -2.98%

Part of the tech sell-off was a typical rotation out of very profitable names to stocks breaking out. The fact is the former, mostly creates paper wealth and the latter are industries that create jobs for hard hat workers; jobs that reflect a theme Americans have longed for as well. 

This is a battle over different jobs and skills Silicon Valley is seeking from outside America, and while we won’t be redrawing maps anytime soon, this is going to be a doozy.  As for names in the thick of the battle, all their shares would be buys on further dips.

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Charles Payne
Wall Street Strategies


 

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