Full Interview: Carl Icahn on Fed Policy, Activist Investing and McDonald's

It's great to see you, and it's especially great to see you, Carl, because I want to tell everybody it's your birthday. If I'm not mistaken, Carl, you're 86 years old today, and you are celebrating your birthday with us, which we're undoubtedly quite happy about. Thank you.

Thank you. It's an honor to be doing it, Eric.

Carl, you like to get into it. So that's what I'm going to do. You predicted months ago that Fed stimulus would metastasize into inflation and fast become a problem for policymakers, for the economy, and, of course, for investors as well. This is a movie that you've seen before. You've seen it several times before. Carl, how does the movie end?

It doesn't end happily, and I've seen, God knows, how many bear markets, and it is similar in one way. It's, it's a sad thing, and a lot of people lose a great deal of capital. And I am not predicting, though, Eric, I'm not predicting that we're in a bear market. I'm not predicting that this is going to end, sort of, this euphoric atmosphere, but I am predicting this: that—and it's not much of a prediction, I guess. But sooner or later, a situation like this is going to end relatively badly, some less badly, some more. But you can't keep printing up money and printing it up and printing it up, because you get what you have now that you can't control. The government can't control inflation. It controls it only what they're doing, what Volcker had to do.

You don't bring interest rates up to 18 percent. I remember those days. It was unbelievable. So I think that's going to happen. But I'm not here to discuss—I'm not a macroeconomics guru. And I just look at simple facts. That's what—it's all I do. Simple facts, and simple fact here is, is the tension between inflation and printed money can't continue to exist without busting.

You say, Carl, that you're not predicting a bear market, but this is going to end in an ugly way. What's the difference?

OK. Well, I'm not predicting a near-term bear market. Nobody can predict what's going to happen next week, next month, maybe even next year or two. You can't. You really can't predict that—too many variables, too many variables. The whole political scene, the whole question of the presidency. But on a big-picture methodology, you can look at it and say it's simple. You can't—I think it's Economics 101 in high school. You can't just keep pushing out money. You can't just keep giving away money and giving away money, giving away money, because that money will definitely lose its worth, like anything else. If you make too many widgets, then the widgets lose their worth. So here's what's happening:

We keep putting out money, putting out money, putting out money. The Fed keeps pushing it out there. And that's great for a while. I mean, that's great. It's like, makes you happy. And at times it's certainly needed. But now you can't—that party has to stop. And sooner or later, what's going to happen is—and you're having it already now, the manifestations of it—is rampant inflation. And it's not there yet, but it has to be controlled. And it's not something that you can wait to see if it happens, because I've seen that in the past. You wait, and you wait too long, maybe. But I'm not here to say the Fed's doing a bad job. In fact, I think the Fed has done a pretty good job over the last few years in sort of saving the economy.

So that's not the issue. But the issue is, if you're asking me to predict something, I'm only saying, and it's not saying very much, I guess, that over the next three, four years, or maybe a lot sooner, you are going to see this whole thing hit the wall in one way or another, and it's not going to be a pretty outcome. Carl, go ahead. Yeah, but I'm not saying it's happening now. In fact, right now, it might be there might be a lot of arguments on the bullish side right now. You know, these companies are flush with money. They may be doing a lot more buybacks. You know, the buybacks last year, I think, added a trillion dollars to the economy. So this could be a lot of bullish things that you could say for the near term.

Carl, is there, is there an Icahn playbook for inflationary times? Are there things that you want to own at times like these and things that you're actively avoiding at times like these?

Yeah. Look, I mean, over the years, the paradigm that I find the best for investing, and it's obviously most people can't do it, is activism and going into companies where the stock is selling cheaply for a number of reasons. And if we can get in there and we can do something, we can help that company. And sometimes we come as uninvited guests. But a lot of companies in this country are terribly run, just terribly run. And by the way, in my mind, that's the reason for the problems that we have today. You have companies that the CEOs are making 10, 15 million a year. And many of these guys are not capable of doing the job, with many, many exceptions. I want to say many exceptions, many very good CEOs, good CEOs worth his salt.

And you pay him. And if things are going well, I don't mind seeing that guy making a lot of money because he's producing. But there's so many bad ones and so many bad boards because the boards aren't doing the one job they're paid to do, which is make that CEO accountable. So those stocks go down. Things get into a problem. We come in. That's our paradigm. We try to clean it up and just change a few simple things, or maybe a few simple things. And over the years, we added up, since even since 2000, you, if you bought our stock, IEP, which is sort of a surrogate for what we do—we have other money, but that's what you can look at—if you put it, if you put money into the company that bought that stock, you made today...

If you look back, you made—if you reinvested the dividends, you made 1,900 percent. And I think the S&P is only 600 percent, 500 percent that you made. So the proof of the pudding is in the eating. You did very well by following and doing this, what we do. There were ups and downs. It's not—it's a bumpy ride. Sometimes we lose for a few years, sometimes secular changes. But the issue I'm trying to make is that the reason we're successful is because you have this very strong problem in our economy today. There's no accountability. And while I believe—maybe I'm jumping ahead, but yes, you are, in fact, you are jumping ahead.

And before we come back to activism, and we will, Carl, I want to introduce you to a colleague of mine, Taylor Riggs, and she has a question for you as well.

Thank you, Eric and Carl. It was so fascinating. You echoed similar comments when we spoke last May, and you talked about waiting for stocks to become cheaper for you to really begin to look at them, to begin to enter. And I am curious if that process may be already started for you in January, and if there were stocks where you looked and they were cheap and we've started to already see some of that volatility, or is it still yet to come?

Yeah, you know, it's more... When you say the stock is cheap, it's cheap for us when we think the hidden value in the company. It's not that we're buying it because the market is cheap or the market's good, because we keep things hedged. We had that record, and we were hedged all along in bull markets, meaning that we have shorts on the S&P, for instance, or other shorts. So we buy what we think is good. And maybe in that industry, we short a stock. I try to stay away as much as I can. And I've learned this lesson the hard way: stay away from predicting the near-term movements of the market.

I read all the guys, and they all have great ideas.

But I tell you, I think there's just too many variables to tell you and even talk about what the market's going to do next week, next month. So we just find companies that we think are valuable if you do certain things where you have poor managements and you can just uncover the hidden jewel for us. I mean, we've done it a number of times. You know, you think back, and some of them are obvious. Sometimes it takes a few years to make it work, but... Carl... Yeah, okay, go ahead.

No, I was just going to say that in addition to obviously... you know, putting up an extraordinary track record as an activist, you are a pretty good trader. You've been active on occasion, right, in commodities or derivatives such as the CMBX. And I'm just wondering, at a time like this, given the conditions that you described, whether you have any trades like that on.

Yeah, well, the CMBX is a good example. The CMBX is a complicated story, but the mall short, as it's called. Yeah, it's sort of a mall short. So to make it simple, it's a little bit like '08. It's analogous to '08, and that's why it's very worrisome. Just like all those mortgages fell apart, in the CMBX, you have like $25 billion invested in 25 deals. But the real, it's almost, that $25 billion, believe it or not, is a tail wagging the dog, because you can do CDS, which is a very complicated derivative, but in simplicity, it's buying insurance. So you're going and you're buying insurance on those deals. So basically, you're buying insurance on a mall. It's not on one mall, but I'm just making an analogy.

And what happens is this market, I believe, and I say this and I think maybe it'd be unpopular. We have that insurance. We made a fair amount of money by buying that insurance on the malls. But I believe that market's manipulated quite a bit, just as in '08. And maybe to some extent it's legal, maybe not. So you have these large mutual funds that sell that insurance—some of them, not many. And then they go out and they sell the insurance, and it's called a CDS. And I believe, well, to begin with, I don't believe that they disclose the risk of that CDS. That CDS is extremely risky. And there are not many funds that do it, but there are a few that specialize, that specialize, but do it. And they actually deceive the people buying it by telling them, and not disclosing to them, the risk there is in that.

I mean, that's why we're making money on the insurance, because there are a lot of people, Mrs. Jones out in Iowa somewhere, I think she's buying Treasuries, because what they do is tell people, 'You know, this is similar to Treasuries.' And then what they do, so then when the insurance comes through—so say you owe me insurance, I'll make it simple. When insurance comes through, they don't want to pay the insurance. So it's analogous to having insurance on health, let's say on your health, and you get sick. How would you like it if an insurance company basically, I'm putting it very bluntly, pay off the doctor or threaten the doctor to say the guy's not sick so they don't have to pay the insurance?

And that's what is going on today in certain cases where we're looking into, and we have evidence that that goes on. Are you fighting that? So that's an area where we think there could be a lot of manipulation, but okay. But that's a sort of specialized thing, and very specialized.

But as you pointed out in that short position that you had via the CMBX, you made a lot of money. I remember seeing a report, in fact, that we published back in 2020. You've made more than a billion dollars. Are you—are you still short the CMBX?

Yeah, we're still short. We didn't quite make a billion, but we made maybe 600 million, something like that, 700 million, which is great. I'm not crying about it, but I just want to correct what you're saying.

I suspect not.

Yeah, we still believe, in other words, some of these malls have come at a—it's a real complicated issue. I'm just talking about where you see manipulation happening similar to what happened in '08. I see a similarity.

I want to ask you, Carl, about McDonald's. I'm really intrigued by your dispute with McDonald's, and I'm not sure how many people are familiar with it. But what you've effectively done is make an issue of animal welfare. You're fighting for better treatment of pigs, and you're fighting with the world's largest fast-food chain. How come?

It's not that I'm picking a fight with McDonald's, because McDonald's is not a company that we own stock in. We own 100 shares. So it's not that we own stock in it or trying to make a profit there. But over the years, I don't do much about it. But for one reason or another, I really do feel emotional about these animals and the unnecessary suffering you put them through. They take these pigs, and a pig has a good brain, and it's a feeling animal. And they take these animals, and for no reason—I say no reason—put them in these gestation crates now. They didn't used to do it 20, 30 years ago. We've become worse, not better. It's almost sadistic. You put them in this crate for its whole life, a crate where the pig can't move.

It just can't move around. And they could easily not do it. So 10 years ago, 10 years ago, my daughter worked for the Humane Society. And she called me up and said, 'You know, look there.' And she knows I hate to see suffering of animals. I was fourth in my regiment in the Army shooting the rifle, so a good shot. Get invited to go hunting; I never went hunting in my life. I just hate to see suffering for no reason. And I'm not trying to be holier-than-thou, sanctimonious, but I said, 'Hey, wait a minute. That's terrible what goes on, and they won't call you back.' So I said, 'They'll call me back.' So I called the CEO back. I said, 'They're going to call me.' And they called me up, and then I discussed it with him.

I said, 'We agree with you, Carl.' The CEO said, 'I agree with you, and we're going to try to stop this, and we will make a pledge that within 10 years there will be no gestation.' The Humane Society accepted that, so I probably would have been tougher on it, but we did it. And now they just never delivered. They did a little something, but never delivered. And so they called me up again. And I was really teed off because here they had promised this and I didn't even know that they didn't deliver or anything like that. So we're telling them, 'Hey, look, you guys promised that you are going to not buy the trims part of this if, if, if it means that you're buying it for those that, that, that those that produce the pigs, so to speak, in these gestation crates or keep them in the gestation crates.'

So that's what's going on. And we are probably 90 percent there for putting up a slate. You know, we're not going to fool around with them anymore. Putting up a slate and say, 'Hey, you've got to live up to your promise and you've got to do this.'

Seriously, you're going to wage your—this is important enough to you that you're willing to wage a proxy fight over it with McDonald's?

Put up a few, you know, slate a few people and wage it. I, I really think, though, it's getting this story out, because I think it's obscene. With chickens, they don't have to suffer, and I mean, it's almost like, you know, they're out dancing. The CEO of McDonald's makes over 10 million dollars a year, everybody's having a party, and maybe he's operating it well, but why the heck can't you just do something? And they say they will pay a premium for it if it's not done under a gestation crate, in fairness to them. And we are talking to them. And we intend to do it in other areas where there's unnecessary animal suffering. I didn't realize how bad it was myself until my daughter really showed it to me. She's a vegetarian.

She's into this stuff. And my son, too, feels strongly about it.

Other areas open up. I don't want to call it a Pandora's box, but Carl, the catalog of animal abuses by the agribusiness industry is enormous. I mean, I'm sure you're familiar with the horrifying footage from, from poultry farms, right? The way they treat chickens. There's some similar stuff that goes on with cattle. And there's other stuff, I should add, that goes on with pigs. What does this mean? You know, tangling with Carl Icahn on a matter of, you know, who sits on the board is one thing. But this is a big issue, and I'm just curious to know whether you're willing to put your money and your word and your actions behind. I just want to get a sense of what you have in mind.

We're going to fight it as much as we can. You know, it's a movement that people now feel strongly about. And it's unnecessary to have this suffering, really unnecessary. It's not something where you could say, well, it's for the good of humanity and we got to do. I mean, and even that is very unnecessary, all the medical testing they do. But at least there's an argument in some cases that you have to do it. Here, you don't have to keep this pig stuck in this gestation crate. You could change it. Of course, they have arguments of why they do it. But there is no argument for this suffering. It just gets you angry. The pig has to spend his whole life in this crate, or now they say they take him out for a little bit, and not be able to move.

Look, the pig's going to get killed. Okay, I'm not going to hold you now and say, well, you can't eat meat because the pig wants to live for years. But, okay, the pig is killed, but it doesn't have to suffer for four years and then get killed. It really gets me upset when we talk about it, and I'm not being sanctimonious about it, but it's something that I think I can help to some extent, you know, ameliorate it to some extent, and I think I'm going to, we're going to do it. But it doesn't take away from what I think I do best is picking these stocks and, and, uh, and, and creating, creating value for all shareholders. We create, we create, I mean, just to digress, we created a trillion dollars of value for all shareholders. I'm not going away from that, but this is an area that, uh...

Well, let me put it this way. I can think of a number of animal rights activists who would love to have Carl Icahn in their corner waging proxy battles with the likes of McDonald's and others. Carl, but I would like to introduce another of my colleagues, Romaine Bostick, and he has a question for you as well.

Carl, I want to talk a little bit about commodities and get your thoughts on what some people say is sort of a new supercycle that we're seeing, particularly in the energy sector and particularly with some of the tailwinds that we're seeing out there because of the shift, or at least, I guess, the dabbling right now with renewable energy sources.

Well, yes, it's a huge question, and you can go on for hours and hours on it. We are involved in Occidental, as you probably know, and we have a lot of that. Oh, and that has got the benefit of this up-cycle now. It's sort of amazing, isn't it, that less than, I think, March, a year ago March—so it's less than a year—you could buy—and we have a refinery, we have a refinery, and we actually bought oil for minus $30 a barrel. That's how bad it was. And now that same barrel, the same thing has gone up, WTI has gone up to over 90. And I'll tell you, I don't think there's anybody in this country smart enough to have made that bet, you know, say, 'You know, we'll make the bet.' I think anybody would give you 50-to-one odds that if you tell them when that oil was negative, they paid you to take the oil because they couldn't store it.

And we bought it in our refinery. Not much. I wish we had bought more, but we couldn't. But, you know, for one reason or another, we couldn't have the storage space. Wherever we had storage space, we cleaned it up and took that oil. And I think you would have been 100 to one odds. You would have given somebody if you said, well, before March of next year, you know, in fact, in February, that same oil is going to sell it over 90. So it's how crazy the commodities are. So we own stocks in them. But I'll tell you, and sometimes we trade the oil market because, you know, we own we own the refineries. And one thing I'm very bullish on, and obviously people know this, that I'm an LNG, for instance, Chenier.

I mean, look how great that company's done. And that's—activism helped out a lot. We got in there, and the CEO was changed, and the new CEO is doing a great job. And the stock has gone up tremendously. This LNG, for instance, I'm sure you think is really interesting, but that you might have predicted. You might have predicted that the world needs—the world needs energy, needs electricity. And where is it going to get the electricity? Outside of this country. So we make all this gas. If you could turn it into LNG, liquefied natural gas, and you turn it into that, you're going to be up, too. And now it's come to fruition because you're going to be able to produce electricity for Europe and Asia and what have you.

So I'm certainly bullish on that for the long term. But trading commodities is not my thing. Every time I just try to trade them, every time I try to trade them without just a long-term thought, it's very hard to do it because... there's so many, again, variables, and suddenly it hits you that you're wrong. 'Oh, my God, this is happening, that's happening.' And in a stock, you say, 'I don't care if you're wrong. I'll just buy more of this company. I'm an activist. I'm going to make it work.' But suddenly, one reason or another... I remember the days we owned Freeport. We made a few bucks on it, but not much, because we just couldn't hold on. There were so many factors coming in at you from Indonesia and whatever, that—

It's not a game for me, but some people, I think, do well at it. Carl, could we go back to activism for a moment? And for those who are just joining us on Bloomberg Television, on Bloomberg Radio, on YouTube, and, of course, on the Bloomberg Terminal, we're speaking with Carl Icahn, the billionaire activist and chairman of Icahn Enterprises. Carl, the SEC has proposed a number of new rules that, at least on the surface, threaten to thwart activists like you. And I don't want to get into a catalog of the rules and their prescriptiveness, but, you know, it would force you to disclose stakes faster. It would force you to disclose economic interest through derivatives and not just common shares. It would expand the definition of a group.

I want to know what you make of these proposed rules and the impact that they'll have on activism.

It's interesting. I mean, there are rules that the SEC are promoting that I think are sort of necessary without getting into details. I think there are abuses. Like I just said in the CMBX area, there are abuses by even these mutual funds and even these investment bankers and guys I know and am friendly with. However, the one that I am adamantly against, and really, again, I'm saying not because it relates to me, which it does. It does relate to me to some extent. But in a way, in a very ironic way, it might even help me. But what they're doing now is throwing out the baby with the bathwater when it comes to activism. Because I completely, totally believe this, that this country, this country, one of the real problems of this country, I said it before and maybe, one of our problems is that—

We have great corporations, but many of them are terribly managed, and that's one of the problems we have. We have the wrong guys running a lot of these companies, and there's no way to get rid of them. There really isn't, because there really is no corporate democracy today. I mean, corporate democracy is an oxymoron, because you really don't have fair votes. And I'm not saying something people haven't almost agreed about, that you really, to go in and fight a company, it costs you a great deal of money. First of all, they beat you up with PR. But I've been through it. So that's what I'm saying. This—these rules don't affect me as much. They beat you up with PR. It's more of a feudalistic system, to be euphemistic.

Which is the rule specifically that, that, that you think would affect you and perhaps other people, too?

The rule that they're trying to push now is the 10-day rule where if you buy stock... So, you want to choose. So, an activist wants to accumulate some stock. He says, 'Okay, I'm going to face all these problems. I'm going to go in there and I'm going to have to put up with the PR. I'm going to have to spend a great deal of money, proxy fight.' I mean, in a political election, you put the guy in jail. If you're, if you're the president and you use the money, the government's money, to go fight, to go fight in the political arena. Here, you have to do all these things. One thing the activist might be able to make money with is he buys stock first, and then he gets to 5%, and then they let you buy stock for another five, six days, so you accumulate some stock.

And then when it gets out, if he has a chance, or he gets the company to sell themselves or do all these things, you make some money for all the work you did. Otherwise, why should an activist even do it? I see a little...

And then it's disincentivizing activism. Have I got that right?

This disincentivizes something that should be done. Now, I do agree, because I want to be fair about this to the SEC, I do agree with some of the criticism. And so, so the criticism basically is some guy goes in and says, 'Hey, look, I'm going to be real smart about this. I'm sort of a known guy. I'm going to buy this stock. And, you know, I'm just going to get it there. Now I'm going to get the PR out there.' And some of these activists do that. They get PR. They get articles. 'Oh, I just bought the stock. Isn't that wonderful?' And the stock goes up, and then he sells it. And I think that is a legitimate criticism.

The short-term game, in other words.

The short-term gain. So I would suggest, and I'm going to do this—I'm writing a paper on it—that it's fair to say that the activist can't make that short-term gain. He has to disgorge it. In other words, if he's an activist, he's buying it for the good of the shareholders, he's saying, and to some extent for the good of the company. 'I'm going to wage a proxy fight or whatever.' He has to keep it for a certain amount of time, as you have in many cases with boards, and he has to keep it for a certain amount of time. But let's say he buys it, and he gets that extra five days or seven days, and he accumulates some stock, and then the stock does go up because he bought it. At least he's going to make some money if the company does go out and sell itself or does other things that he suggests.

So otherwise, what this rule is going to do is actually discourage activism even more than it is discouraged today. And just to add to what I said before, I think that's a very bad thing for economic society because right now you need activists. Yeah, you absolutely need them more and more now. Right now we have inflation. We have badly run companies that are not accountable. And the boards really don't do their job. So you do need activism. And this is going to be almost the last nail in the coffin. There are a lot of nails in that coffin already.

I know I want to move on to ask you a question, and I'll preface it by saying this. I know how much you don't love talking about politics, but I do have to ask you about somebody whom you know well, Donald Trump. Everybody knows that you supported him, you know, in his presidential campaign, and on occasion, you functioned as something, I would say, of—as something of an informal advisor. You and he talked about some issues together. Because of that, people would like to know, and I'd like to know, if he were to run in 2024, would you support him? Yeah, it's a good question, and I would—I would have to think about that quite a bit. I think Trump did a lot of good things.

And I disagree with him on a number of things. And, you know, I obviously have a big business to run and spend a lot of time on it. And I wasn't able to go down to Washington a lot. In fact, I don't think I ever went down there except for the inauguration, even though I was invited down there by Donald. I basically am not a guy that gets into politics. I think Donald's done a lot of good things. He's done things I disagreed with. However, I will tell you, and I've been around a long time, I've never seen Washington as confused as it is today. Who do you blame? Erik, look, I—I look, it's obvious—I mean, I don't want to get into politics here too much, but I would say that right now, I think that—

We have just made tremendously poor decisions in the last six months. I mean, go from Afghanistan to other countries. Political decisions, I really don't want to get into too much. I don't want this to be a political thing.

No, I understand. And I framed the question very narrowly because I didn't want it to become an expansive discussion about politics. But you're not decided, it sounds to me, if you would or would not support him in 2024. Does that depend on whether he does or doesn't, or who's running against him?

One thing, the way it is today, there's no question in my mind I would support any Republican that's nominated for the presidency, the way this plays out today. And I would support any Republican candidates in November, because right now, this is this—I'm not saying, Erik, that you don't know this, but it's a rudderless ship right now. So I would do that. So I would support anyone to do it. But I have not—I'm not saying that, you know, Trump is necessarily the right guy. I'm not saying he's the wrong guy. I just, you know, haven't spoken to him for quite a while. And not that I wouldn't speak to him. I mean, you know, we're friends and all, but I haven't spoken to him at all. I'm not sure it matters a hell of a lot who I support anyway.

So, well, one of the things that's just fueling the disagreement in Washington that you make reference to is inequality. And you've raised concerns about income and wealth inequality in America. And you've connected the inequality problem with compensation in many respects—CEO compensation, compensation for bankers that you consider overblown relative to, you know, what they're contributing. You've probably noticed, Carl, that CEO compensation and compensation in general on Wall Street is going through the roof. There are some bank CEOs who are making upwards of 30 million dollars a year. And in fact, there are two current CEOs on Wall Street who are billionaires. What do you make of that?

I just said to you before, there is no accountability in a corporation. So by definition, you're going to expect that if you, if you, if you were running—you're running your program here, you do a great job. Okay. But if there was no—it was up to you, and you ran all of Bloomberg. Hey, it was up to you. Wouldn't you give yourself raises and raises and raises? I mean, the boards do nothing. If the board does nothing and you go and say, 'I'm going to leave, buddies, if you don't give me a raise,' well, of course. So you have no accountability at these companies. And look, I've lived it. I don't think that—I honestly don't think. I am not criticizing the SEC because they are doing some stuff they should be doing.

A lot of it they should be doing. But I am saying that if you really understood what went on in these companies, which we do, or I do, you would be saying you can't believe it. Maybe to jump ahead, the—and I think maybe it'll interest some of your shareholders. We're in a proxy fight now with Southwest. And that's the quintessential example of what I'm talking about. You've got a board that's basically just—

Well, you've been—I mean, that's a situation where you've—I mean, honestly, Carl, I'll ask you, because you raised it. You've played some pretty big cards already, right? You've proposed dumping the entire board, if I'm not mistaken. You're opposed to their purchase of Questar Pipeline and the manner in which they're financing it. You know, you've made a tender offer for the company. What's next?

How do you win? I'm only saying to you that it's an example. I mean, we really—that we are making that tender offer, and we believe it will be successful. We believe we're paying $75. The stock would be 61 or something if we weren't there. It's now 66 or something. And it's a good test. But we think we met every condition you need for that tender offer. And they keep coming up and say it's conditional. Well, it's conditional on the poison pill, but I mean, the simple strategy is, you know, if we have that tender offer and they got the poison pill, then if they vote us into power—not us, but we have an independent board, for the most part, goes into power—they drop the pill. They say they will, then we can pay them.

They have a condition. There's a condition where there's regulatory agencies in three states. But I don't think we violated any of the rules of those regulatory agencies.

So it's just a matter of time, you think, before you emerge victorious?

I'm sure there's litigation, but I believe it's a matter of time. Okay, about that tender, just talking about the tender, but to get back to the original point, the country—you make the point very well, Eric, that there is no question that the whole system is almost—it's sort of a vicious cycle where each group that's in power wants to, you know, help the other group because they help each other, and therefore you have this great overpayment. But that's not even the real reason that you have the problems. The overpayment is just a manifestation. We have great companies. These companies can produce. They're not producing because you have bad managements and boards that will do nothing about it.

And it takes a guy. And I'm not trying to praise myself but it takes guys like us activists to go in and shake them up. And it's your business. The reason that that the proof of the pudding is in the eating. If you bought the stocks we bought, you know, over the years, we made over a trillion dollars for shareholders just by increasing and enhancing value. Not because we're geniuses. He was saying we're great operators but just by cleaning up the mess.

I'm curious, Carl, to know, in the course of waging those battles, who you go to. Who's your go-to guy on Wall Street? I asked you about bankers, banker compensation, but I'm equally interested to know, when you want somebody in your corner—a bank, banker, a CEO, Wall Street CEO—who do you turn to?

Yeah, I mean, we have a couple of favorite bankers. I mean, to raise us capital. Basically, we use the banks not so much for strategy. No, no, no.

I realize you use them, but to raise capital...

And we've used, look, we found in one deal we did, we found Citibank to be very, very effective. Jefferies is another company that's very effective in raising capital as far as we're concerned. And we work with them. And, well, I think we overpay for all this stuff. It's not outrageous with them as it is with some of these companies, some of these very high gilt-edge companies. What they charge is completely outrageous. I mean, but—and I've said it—I, look, I agree with you completely. This whole area is completely... I believe that if the CEO is really good and he's got a stock way up and the shareholders are making a great deal of money, okay, he does deserve to be compensated because maybe he could go somewhere else and do the job.

He did a great job. So I'm not saying that. Or somebody risks his money. He goes into a deal. He buys his stock. He helps that company or whatever. But he risks his money. He deserves it. But these guys, these CEOs and these guys, I mean, it's almost—it's almost like on a comedy show. The CEO does a terrible job. So his options don't come in. So he complains. He says, 'Hey, I'm not making money on my options. So what you've got to do is lower the—lower the striking price of the option so I can make money.' He's done a terrible job. But he says, 'Hey, you've got to lower the price of the option,' and the boards do it. And we jump up and scream about it, but what the hell can you do?

Speaking of comedy, those who watch the HBO documentary will see a clip of a routine that you once put on at Carolines, the comedy club here in New York City. But I also mentioned the documentary, Carl, because... I watched it last night, and it left me with two unanswered questions that I'd like to get to before you and I wrap up. And the first concerns succession at Icahn Enterprises. It's not exactly clear, coming out of that movie, whether your son Brett will or won't take over for you at Icahn Enterprises. Have you decided?

I don't even think it's a decision. What Brett said is sort of true, and I think he summed it up. Look, as long as I'm healthy, I enjoy what I'm doing. I'm an old guy, but, you know, I haven't lost my marbles, and I think I'm real good at what I do. You know, I sort of over the years perfected what I do, and I enjoy it. So I don't want to, you know, give up the reins, and maybe I could get a few things done in different areas. But after that, you know, Brett is a very competent guy. And I think it's going to work out that he—but Brett is—I don't think he would say it himself. He's not an operator so much as somebody that goes out and sort of does what I do. And by the way, I'm not an operator either.

In other words, I don't go in and take any credit for saying, 'I'm going to this company. I'm telling you, you should build a building here. We should do that.' We get into those companies and make sure the operator is producing the numbers he thinks he'll do and that he should be doing, and helping them with M&A. We're really good at M&A. So when they want to raise money for something, we look at that and say, 'That makes sense. Let's do it.' And then we get the money for them and that kind of thing. And that's what Brett is very good at. And I think, forgetting that he's my son, I think he'd be the kind of candidate I would have to be the successor. And obviously, I think Brett himself would admit or realize and say it that he's not the guy that's going to be the guy, the hands-on guy at the different companies to operate them.

But that's not what we do. We have good guys running the companies.

Only on rare occasions. The second question I have, Carl, for you is about legacy, this unanswered question, if you will, from the documentary. You signed the Giving Pledge. And in the film, Bill Gates says that means you've committed to giving away more than half your wealth. I know from Mike Bloomberg that giving away many billions of dollars is, is challenging. Right. It takes thought. It takes time. It takes effort. And here we are, as I mentioned at the outset, it's your birthday. You're 86 years old. And I'm kind of curious to know, you know, when do you start giving away a whole lot of money?

Well, I mean, we, we—I just—we just gave another 40 million to Mount Sinai toward the—you know, we have that Mount Sinai Hospital, and then, you know, we have the Icahn Stadium. Over the years, we've given away, and that's sort of interesting, we've given away money for these colleges, and I can name a few, Choate and all, that there are buildings. Princeton, we gave a building to. So we have given away a lot of money. And I think they probably like it. I don't personally get too involved. You know, a lot of guys like to go on the boards of these things, to go on the boards of the institutions. I mean, and honestly speaking, the only thing that I'm getting involved in, because I can help it, is this animal rights thing, where I think there's a way that I can be really helpful to seeing that happen.

Because I think that's a situation that's just horrible and obscene. You've got these companies making all this money and these animals just suffering for no reason. Okay, I'm not going to keep beating it. So I think that's something that, you know, I would, you know, the foundations that we have would be much more involved with this animal rights thing. And obviously, we have a lot of money, so we'll be on other things. And the foundation itself is still, I mean, there'll be certainly enough money. If I get out of the business for any reason, IEP will still have, I mean, it's not going to affect the amount of capital they have today, and I mean, they're a public company, so the money they have today is not going to be affected, nor would I want that stock sold.

I'd like to see that as a legacy to continue. And I think if you ask who's the guy that's going to run it, I think Brett has learned enough and is quite fit to do that. As I say, the operation would continue very much in the way it is now where I don't really get in, nor would Brett, and tell these guys how they should operate the company day to day. But, but hold their feet to the fire if they're not producing unless there's a reason not to. I mean, if you have a terrible recession, you can't blame somebody for not making money. So I think that's where it's going.