Carl Icahn releases ‘Danger Ahead’ video covering his views on markets, stocks and politics

In a new video released today, Carl Icahn, Apple’s largest individual shareholder, explains why he thinks the market is especially overheated in the high-yield bond market.

30 years, no tax reform. 30 years, no immigration. As a result, you have this movement toward a guy like Donald Trump becuase you want somebody who’s not beholden to the establishment. So, we need a president that can move Congress. And I think Donald Trump could do it. I disagree with him on certain issues and certainly would talk to him more, but this is what this country needs, somebody to wake it up…

Our country is shooting itself in the foot because these companies are saying they’re not going to bring [offshore profits] back then. Who are they punishing? They’re punishing the little guy again because if that money came back, it would make for jobs… It’s absurd not to make a deal. And, these companies are willing to pay a tax. Everybody agrees that it should be done it’s just having a food fight – it’s almost funny if it wasn’t so sad – it’s “who’s going to get the credit for it,” you know, is it going to be the republicans that are going to put their foot down and say, “hm, we’re not going to charge any tax to take it back” or the Democrats that want 15% of that money back, so the whole thing’s absurd…

Now, I have been a proponent for buybacks in companies like Apple where they’re sitting with $200 billion in cash and not a lot of debt. They should do buybacks. Especially at Apple where the stock in nine times earnings. But you have companies today [that shouldn’t be doing buybacks].

We are making earning by financial engineering… If low interest rates were just that simple of a panacea, we would never have recessions, we would never have these crises, we would never have these panics… Where do you draw the line here?

I’ve seen this before a number of times. I’ve been around a long time. I saw it in ’69, ’74, ’79, I could tell you, ’87, and then 2000 wasn’t pretty and I think a time is coming that might make some of those times look pretty good…

I look back and I love this country, but I sure as hell don’t love a lot of the politicians in it, or the CEOs. I think they’ve taken advantage of the system and it’s just déjà vu. The public, they got screwed in ’08. They’re going to get screwed again. I think it was Santayana who said “those who do not learn from history are doomed to repeat it” and I’m afraid we’re going down that road.

Direct link to video here.

SEE ALSO:
Apple’s largest individual shareholder, Carl Icahn, endorses Donald Trump for U.S. President – September 28, 2015
Icahn warns about U.S. stock market while touting Apple – June 25, 2015
Carl Icahn lauds Apple Watch, but he doesn’t want to be pushy – May 20, 2015
Carl Icahn’s open letter to Tim Cook worth $8.35 billion for Apple shareholders – May 18, 2015
Why Carl Icahn believes Apple’s share price should be $240 – May 18, 2015
Carl Icahn issues open letter to Apple CEO Tim Cook – May 18, 2015
Apple expands capital return program to $200 billion – April 27, 2015
Here’s why Carl Icahn wants even more Apple buybacks and why CEO Tim Cook has to pay attention – October 9, 2014

36 Comments

    1. The Obama Nation has done exceptionally well. Under Obama, unemployment has plummeted, the stock market has soared, corporate profits are at record levels. The deficit is falling faster than predicted. Housing starts are strong. This country’s recovery from the The Great Bush Recession has been far better than any other western country’s. Parts of Europe are still struggling to get unemployment down below 20%. Growth in Europe is still stagnant whereas here the economy is growing slowly and very steadily again. And that’s despite the GOP’s best efforts to force us down the path that Europe took.

      Trump, meanwhile continues to be the biggest hypocrite around. Complaining about manufacturing going to China while outsourcing his clothing line to China. Complaining about immigrants while hiring them in droves. Complaining about avoiding consequences although his companies have declared bankruptcy four times. He knows nothing about running a country. He doesn’t even know it’s different to running a company. He was born with a silver spoon in his mouth and is as removed from reality as all republican politicians.

      1. Yes, under Obama unemployment has “plummeted”. Because Obama does not count the unemployed. After the sad unemployed person exhausts unemployment insurance they go “off the grid” and are magically no longer unemployed. Thus we have 5% unemployment with almost 100 million able bodied working age people not working – the highest since before the great depression. Wages have been static for 10 years. Taxes are higher. Healthcare costs are skyrocketing. Illegal immigrants are being imported by the sh*th#ad Obama by the millions, including terrorists, so they can go to the inner city and compete with young blacks for jobs. Young blacks not are unemployed at about 50% rates in the big cities. Yes – it’s all so peachy under the Obama regime.

        1. I’m not pretending that there isn’t more work to do. But compared with other countries hit by the Great Recession, this country has recovered the best. All countries “massage” unemployment figures. Wages are close to stagnant all across Europe. This country is not perfect, nor out of the woods yet. My point was that under Obama, it’s done far, far better than European countries that followed the GOP’s mantra of “severe austerity is the only way.”
          BTW – heathcare costs are NOT skyrocketing. The rate of increase has been decreasing for several years now. But while ever profit is a motive in healthcare, costs will not reduce.
          And I’m not even going to respond to your point about immigrants and terrorists. You know full well that’s just FUD.

          1. You obviously are new to the idea of research or knowledge of the economy. No doubt an Obama voter. The current unemployment rate as declared by the major media is 5.1. That is the U3 rate. The U3 rate is exactly as I described. The accurate figure is the the U6 rate which is presently 10.3, double the U3. The U6 rate is never mentioned in the news. You would know these things if you bothered to do actual research. And you would know them if you were not an Obama drone.

            From Investopedia – http://www.investopedia.com/articles/investing/080415/true-unemployment-rate-u6-vs-u3.asp

            “The U-3 unemployment rate is a comparatively narrow technical measure that leaves out a whole swath of out-of-work people who are willing and able to take a job but who don’t fit the narrow BLS definition of “unemployed.” For example, a stonemason who wants to work but who has become discouraged by a lack of opportunity in the midst of a deep economic recession would not be included in U-3 unemployment. A marketing executive who is laid off at age 57 and stops scheduling new job interviews due to her experience of age discrimination would not be included in U-3 unemployment. A person who only works one six-hour shift per week because no full-time jobs are available in his area would not be included in U-3 unemployment.”

            In contrast to the U-3 rate, the U-6 unemployment rate includes all of these cases. Consequently, the U-6 rate is much truer to a natural, non-technical understanding of what it means to be unemployed. By capturing discouraged workers, underemployed workers and other folks who exist on the margins of the labor market, the U-6 rate provides a broad picture of the underutilization of labor in the country. In this sense, the U-6 rate is the true unemployment rate.

            Read more: The True Unemployment Rate: U6 Vs. U3 http://www.investopedia.com/articles/investing/080415/true-unemployment-rate-u6-vs-u3.asp#ixzz3nDPkkct3
            Follow us: Investopedia on Facebook

            1. Your original statement was that when people exhaust unemployment insurance they are not counted as unemployed was completely incorrect. I am glad to see that you have at least done a bit of research since then.
              If you are going to use U6 now, then you have to use U6 for past economic measurements also. You can’t compare U6 now to U3 under Bush and claim unemployment is higher now.

              Besides, U6 has a 99% correlation with U3.

              Additionally, U3 is the international standard, that is why it is the primary one reported. U6 also suffers because it includes part-time workers who claim they would like to work full time. Saying that they are unemployed is a reach, at the least.

            2. Nope. Wrong. How does the BLS, a FEDERAL institution, get information from the STATE unemployment office.

              Christ, I have five papers sitting right next to me telling me you are incorrect, ignorant and unwilling to fix your blind spots.

      2. Things are better than when Dubya left, but hat is not a very high bar.
        As to unemployment- if one does not register at the unemployment office you are not counted despite being unemployed. The true numbers are easily double the official figures. Underemployment- where people work 2-3-4 part time jobs as they cannot secure full time employment- is very high. A recent study found that over 50% of young African-Americans and more than 1/3rd of white & Hispanic youth are looking for full-time work.
        The stock market is high because tone of the money created out of thin air by the Fed has flooded into the markets. The banksters were made whole, main street was given the middle finger, not one bankster was prosecuted and Eric Holder has returned to his old law firm that represents banksters.
        The “Free Trade” deals that are unfair to all but huge multinational corporations continue to export wealth and jobs from the United States even as Obama has negotiated the TPP, TTIP and TISA. These are being supported by Republicans in Congress despite being negotiated by Obama and are opposed by Conservatives and Progressives alike- the sellouts who play the middle are all for it.
        The Oil sugar high from fracking is running out of gas and the price of oil will be going up- way up- in the future. Peak Oil for traditional forms of crude has passed and the supply is being filled by non-conventional sources that are already petering out.

        America is in debt, has a non-functioning government unwilling to do it’s job, is exporting jobs and wealth, has a shrinking labor base to pay taxes, has corporations dodging taxes by any means available, has a number of ongoing wars, is spying on it’s own citizens against the Constitution, and falling further behind the nations in workforce quality and training.
        We also imprison more people than anyone else.

        Obama has not been a good President. Stop pumping bullshit.

          1. I said nothing about unemployment insurance. The rate is based upon those who register with the employment offices state by state. That is factual.
            The real unemployment rate is well over 10%. The underemployment rate is twice that.

            1. You do not have to register! The BLS surveys a random set of households. Give them credit, they know what they are doing and they do it right.

            2. The upshot of the Gallup article is that the author thinks that U6 is a better measure of unemployment. Not only is this non-standard (the international definition of unemployment is U3) but U6 has over a 95% correlation with U3. So there is no reason to use U6.

      1. It’s our primarily sucky two party system that’s devoid of intelligence. They’re all a bunch of losers. As Darth would say “Don’t be too proud of this political party system you’ve constructed. The ability to elect doofuses to office is insignificant compared to their power to destroy our nation.”

        All with the “best of intentions and/or graft (whichever comes first and pays best)” and we know where that road leads to.

        And they are ALL culpable.

  1. I wish I knew enough to agree or disagree. The ideas on repatriation sure sound rational to me. I do not comprehend high finance, but I was smart enough in the late 90s to think Mortgage Backed Securities were so crazy they should have been illegal.

  2. I don’t know about Trump, but I do know that AAPL is a good investment in an uncertain environment.

    > The public, they got screwed in ’08…

    But AAPL investors did NOT (as long as they didn’t panic and sell). That was when Apple edged over $200 (pre-split) per share, and THEN spent the year (2008) dropping off that cliff to about $80. Remember that…? Look at the ten-year stock chart for AAPL now, and that traumatic period when the “public got screwed” is just a small blip. Using the same pre-split pricing, recent AAPL price is about $800, even after dropping for the latest all-time highs.

    The reason for AAPL’s resilience is Apple’s HUGE cash hoard, which is many time larger now than back in 2008, and the predictable ability for Apple to keep generating more profit from several diversified product lines, including services like iTunes (digital media distribution) and Apple Pay. Apple probably could have bought itself back in the worst of 2008, with its current pile of cash.

    That cash, which some “experts” seem so keen on spending, is Apple’s self-insurance. It’s a “buffer” for price drop (because it simply exists PLUS also allows stock buybacks). And if Icahn’s fears are fully realized, AAPL will drop along with the rest of the market. But when other companies struggle, it’s an opportunity for Apple to use that cash to acquire key technologies one the cheap, and emerge at the other end stronger (and more dominant) than ever before.

    Apple wins either way, and so do Apple’s long-term investors. 🙂

  3. “They’re punishing the little guy again because if that money came back, it would make for jobs…”

    LOL please. This will go directly back to shareholders. Companies aren’t going to hire a bunch of unnecessary employees just because they have more money. They are wringing every bit of productivity possible out of their current employees for fear they lose their jobs.

    This is more supply side bulls**t. 30 years of it and people are poorer and poorer.

    1. money that is not new money printed by the federal reserve entering the money supply is a good thing. it is not adding to our debt (this includes yours). not all of the 2.1 trillion will come back as there are reasons to hold it overseas for transaction liquidity, etc, but much of it will.

      if you watched the video, and understood it, the fed’s artificial low interest rates are a huge problem going forward. they are artificially making it possible for the rich wall street bastards to apply financial engineering to pump up their balance sheets and stock prices, stuffing their pockets along the way. repatriating this $ keeps it out of the hands go the government (especially if is ti not taxed at all). this free flow of cash will soften the landing of the fed raising the rates, as banks will have this capital to loan without borrowing it from the fed. they will have capital in deposits (holy hell, when was the last time we saw that!!!) and work the way banks are supposed to work. then small businesses will have access to that capital to grow their businesses. far from it just going to the stockholders. that will be the least likely event. if you hate supply side economics, you should hope that doesn’t happen because that is what it is.

    2. we are in the midst of some supply side BS now. instead to the private sector creating jobs and employing people, the government (social security, disability, unemployment, food stamps, subsidies, etc), are injecting cash into the economy by borrowing and handing it out to people with low income. income redistribution is not different from supply side economics at the transaction level. it is just different at settlement time (when the bill comes due).

      think of it as a bathtub you are filling. traditional supply side economics turns the spigot on and lets the water run. income redistribution is the same, except it does not require the stopper to be in.

      1. We are 35 years into the fraud that is trickle down economics. When the top 1% hoard wealth equal to the bottom 90% then it’s time to turn policies around. Private enterprises will generally destroy lives and our world for money. Enough is enough. Icahn has verifies that he is an idiot. Trump. Hahahha

  4. Ichan makes several great points that I fully agree with:

    -Wall Street is great at selling securities and then shorting these same investments. They have less morals than the mafia.

    -When there is a rush for the exits to sell this junk, there won’t be a market. It’s happened many times before and the next crash may be far worse.

    -Many companies are in the business of financial engineering tricks to look good for Wall Street but this isn’t a healthy way to invest in and run a business.

  5. Yeah, I’ve already seen this FUD from a variety of other people before you Mr. Icahn. Ron Paul is now infamous for bad ads on TV steering people to malicious web pages full of mega-FUD about an economic collapse. There’s nothing new here Carl. I’m not going to visit your attention whoring video. Sheesh, grow up!

    To everyone else: The point of this propaganda is to FUD everyone into voting for a corporations to further take over and ruin our human world by way of their puppet politicians. Been there. Seen that. Total FAIL. No more, thank you.

  6. So many questions. Is he really talking about the same Donald Trump I think he is? Is Icahn really as clueless and moronic as his words here, or is he aware of what he’s saying is garbage and hoping the masses are dumb enough to fall for these plutocracy lies?

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