Tags: Icahn | CEO | companies | Fed

Icahn: 'We're Going to Have Morons Running Companies Soon'

By    |   Friday, 18 July 2014 09:13 AM

Star activist investor Carl Icahn says his actions are necessary to save companies from incompetent executives.

"I do love this country. I'm not so sure I love a lot of the people. We're going to lose this, because the wrong side is running these companies," Icahn said at an investment conference this week, CNBC reports.

"We're going to have morons running the companies soon, and we're almost there," he noted, explaining that the person below the CEO usually has to be a little dumber than the CEO is in order to succeed to the position.

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"It's amazing how bad these companies are and the boards are when we get in them."

Icahn conceded that "there are many good companies and many good CEOs, but we generally don't bother them too much."

Many CEOs are lazy, he insisted. "The only way you can get these guys off the golf course is when I file a 13-D," Icahn explained, alluding to the regulatory form that is mandatory for an investor who amasses a stake of greater than 5 percent in a company.

"What a board should do is not tell the CEO what to do. They should leave him alone, really leave him alone," he added. "What they should say is if you're not producing . . . if you're not doing as well as your peer group, get off the golf course and get to work and stop worrying about what plane you have."

As for the Federal Reserve, Icahn lauded former Chairman Ben Bernanke for "saving this country" after the financial crisis. But he thinks the Fed has overdone its easing. "You've got to worry about the excessive printing of money," Icahn warned.

David Rosenberg, chief economist at Gluskin Sheff + Associates, also sees the central bank's policy as flawed.

"This Fed is erring on the side of uber-accommodation far too long and is playing with fire," he wrote in The Financial Post of Canada.

The real federal funds rate may reach negative 0.5 percent by the time full employment is reached, Rosenberg said.

"If this forecast proves prescient, it is difficult to believe inflation expectations at some point won't become unhinged and send long-term bond yields substantially higher," he noted.

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Star activist investor Carl Icahn says his actions are necessary to save companies from incompetent executives.
Icahn, CEO, companies, Fed
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2014-13-18
Friday, 18 July 2014 09:13 AM
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