Elon Musk says Warren Buffett is positioning for Kamala Harris win with his $277 billion cash pile

While Vice President Kamala Harris is gaining ground in polls against her Republican opponent Donald Trump, she hasn’t made much headway with the business and investing community. Hedge fund manager John Paulson, founder of Paulson & Co., stated during a media appearance on Tuesday that he would withdraw his money from the market if Harris were to win. Tesla CEO Elon Musk also raised concerns, hinting at even graver consequences.

Paulson told Fox News, a conservative outlet, that market and investor behavior would hinge on the outcome of the presidential race. As a vocal Trump supporter and Republican donor, Paulson's allegiance is mutual—Trump was reportedly considering him for the Treasury Secretary role, according to a Bloomberg report from March.

“If Harris is elected, I’d pull my money from the market, go into cash, and buy gold. The uncertainty around her plans would likely cause market instability and declines,” Paulson said, referencing Harris’s economic proposals. Paulson, who made a fortune betting against subprime mortgages in 2007, is wary of Harris’s tax plans.

While Trump aims to extend the 2017 tax cuts enacted during his presidency, Harris has proposed letting them expire. Paulson highlighted her intention to raise the corporate tax rate from 21% to 28% and the capital gains tax from 20% to 28%.

Additionally, Harris has floated a 25% tax on unrealized gains for individuals with a net worth of $100 million or more, which Paulson believes would trigger “mass selling of almost everything—stocks, bonds, homes, art,” potentially leading to a market crash and swift recession.

Musk weighed in after Mario Nawfal shared the Fox News clip of Paulson’s interview on social media, saying, “[Warren] Buffett is already preparing for this outcome.” Musk, a public Trump supporter, appeared to be referencing Buffett’s investment firm, Berkshire Hathaway, which has been reducing its holdings in key stocks.

Berkshire sold 115 million Apple shares in the first quarter and another 390 million shares in the second quarter. Despite these sales, the firm still held 400 million Apple shares by the end of June. Buffett explained at Berkshire’s annual shareholder meeting in May that the sales were meant to raise cash for federal taxes and to maintain a larger cash position during uncertain times. At the end of the June quarter, Berkshire’s cash reserves stood at a staggering $277 billion.