WHEN: TODAY, WEDNESDAY, June 24, 2015
WHERE: CNBC'S "FAST MONEY HALFTIME REPORT"
In a CNBC EXCLUSIVE interview, Icahn Enterprises Chairman Carl Icahn speaks with CNBC's Scott Wapner on CNBC's "Fast Money Halftime Report" today. Following is a link to the video on CNBC.com: http://video.cnbc.com/gallery/?video=3000391306.
All references must be sourced to CNBC.
WAPNER: SUE, THANK YOU SO MUCH. IT WILL GO DOWN AS ONE OF THE GREATEST TRADES EVER. CARL ICAHN GETTING INTO NETFLIX BACK IN 2012 NEAR $58 A SHARE REVEALING EARLIER TODAY THAT HE CLOSED OUT THAT POSITION WITH THE STOCK NEAR $700. THE NEWS COMES AS WE LEARN OF NETFLIX 7 FOR 1 STOCK SPLIT AS YOU KNOW BY NOW. THE BILLIONAIRE INVESTOR ALSO ISSUING YET ANOTHER WARNING ABOUT THE MARKETS, CARL ICAHN JOINS US NOW LIVE ON THE PHONE. CARL WELCOME BACK. EVERYBODY OBVIOUSLY TALKING TODAY ABOUT THIS NETFLIX CLOSE-OUT. WHY WAS NOW THE RIGHT TIME?
ICAHN: WELL THERE'S NEVER A RIGHT TIME, I GUESS. BUT NETFLIX IS STILL A GREAT COMPANY. I THINK REED HASTINGS HAS DONE A GREAT JOB. BUT FROM OUR POINT OF VIEW, WE, I THINK THE MARKET IS SORT OF OVERHEATED. I ALSO THINK THAT NETFLIX, AND I'M NOT IN ANY WAY CRITICIZING NETFLIX. BUT WHEN WE DID IT, IT WAS PRETTY MUCH OF A NO-BRAINER. IT WAS VERY HARD TO COMPETE. IT WAS SORT OF WHERE APPLE IS TODAY. I THINK APPLE HAS HUNDREDS OF POINTS LEFT IN IT PERHAPS-- I'M NOT GOING TO CALL EXACTLY WHERE IT COULD GO. BUT APPLE IS A GREAT COMPANY, WITH GREAT BARRIERS TO COMPETITION. NETFLIX YEARS AGO, WAS TREMENDOUSLY UNDERVALUED BECAUSE IT WAS VERY HARD TO COMPETE WITH THEM. I THINK TODAY THE COMPETITION IS SOMEWHAT EASIER IF YOU SEE THE SECULAR CHANGE GOING ON. WHERE THEY'RE BUILDING SERVICE, WHERE THEY COULD GO OVER THE TOP AND THERE'S GOING TO BE CABLE COMPETITION, CABLE MAY CHANGE. DRAMATICALLY. AND THAT IS NOT TO SAY THAT NETFLIX IS NOT A GREAT COMPANY, STILL. BUT I, I THINK APPLE IS WHERE NETFLIX WAS A COUPLE OF YEARS AGO WHEN WE GOT INTO NETFLIX.
WAPNER: IT'S INTERESTING TO HEAR YOU SAY THIS. BECAUSE I CAME IN TO THE INTERVIEW TODAY, CARL, FULLY EXPECTING YOU TO SAY THAT IT WAS MORE REFLECTIVE OF YOUR VIEW OF WHERE YOU THINK THE OVERALL MARKET MAY BE HEADING. AND HERE I HEAR YOU SAYING THAT YOU'RE CONCERNED SOMEWHAT ABOUT THE FUNDAMENTALS OF THE STORY ITSELF. AND THE OTHERS WHO ARE TRYING TO GET INTO THIS GAME.
ICAHN: YEAH. I MEAN THERE'S SOME CONCERN THERE. BUT I THINK YOU'RE VERY RIGHT. I'M VERY CONCERNED ABOUT THE MARKET. AND I THINK THE MARKET IS OVERHEATED, ESPECIALLY THE HIGH-YIELD MARKET. AND IT'S SORT OF A SAD COMMENTARY. BECAUSE I THINK THE PUBLIC IS WALKING INTO A TRAP AGAIN. AS THEY DID IN '07. WHAT I'VE SAID IS YOU KNOW, AS I GET OLDER, I THINK IT'S ALMOST A DUTY OF WELL RESPECTED INVESTORS LIKE MYSELF, I HOPE, TO WARN PEOPLE, TELL PEOPLE THAT YOU'RE REALLY MAKING ERRORS. NOW YOU KNOW, NOBODY CAN PICK THE MARKET PER SE. BUT A NO BRAINER IN MY MIND IS THE HIGH-YIELD MARKET, BECAUSE IT'S ALMOST RIDICULOUS TO GO IN AND BUY A HIGH-YIELD BOND TODAY AT 5.25%. THAT'S A SINGLE B BOND AT 5.25 WHEN YOU CAN ACTUALLY BUY CORPORATES, SINGLE A CORPORATES THAT REALLY AREN'T GOING TO GO BANKRUPT. THERE'S ALMOST NO CHANCE. AT 5.25. SO FOR 2%, PEOPLE ARE RISKING 40%, I MEAN IT'S ABSURD. AND YET, I DON'T MEAN THAT CASTING ASPERSIANS THAT WEALTH MANAGERS ARE PEOPLE THAT ARE ADVISED BUT, WHY WOULD YOU ADVISE SOMEBODY TO DO THAT. I THINK THE PUBLIC IF YOU TALK TO THEM DON'T UNDERSTAND THE RISK IN THE HIGH YIELD. THEY LOOK AT THE HIGH YIELD AND SAY WELL I'M MAKING 5.25%. AREN'T I SMART. AND THEN YOU KNOW AS INTEREST RATES HAVE COME DOWN THEY'VE GOT USED TO EVEN MAKING MORE MONEY. THE BULL MARKET AND BONDS AND SO THEY DON'T UNDERSTAND THE GREAT RISK THAT IS THERE. YOU HAVE BONDS AND IF YOU READ THE COVENANTS OF THESE BONDS, THE COVENANT-LIGHT. MEANING THAT THEY'VE BEEN ABLE TO SELL THESE BONDS WHERE IF THE COMPANY HAS PROBLEMS, IN A SINGLE B RATED COMPANY AND MANY OF THEM I THINK WILL HAVE PROBLEMS LOOKING AHEAD, BECAUSE I THINK THERE'S GOING TO BE UNCHARTED WATERS AHEAD. AND IF YOU DO HAVE PROBLEMS IN A HIGH-YIELD MARKET. WITH THOSE BONDS. THEY'RE SO COVENANT-LIGHT, IT'S WORSE THAN EVEN 2008. WHERE THEY CAN PUT BONDS ABOVE YOUR BONDS. MEANING YOUR BONDS WILL BE AT MORE RISK. AND I THINK THAT THE DEFAULT RATE COULD GO UP. ANECDOTALLY, GETTING AT THE RISK OF BEING IMMODEST. IN '07 I SAW THE SAME THING AND WE PUT ON THIS CREDIT SPREAD. SO ESSENCE SHORT THE HIGH-YIELD BONDS. IT'S ARCANE WHAT WE DO BUT BASICALLY WE DO A CREDIT SPREAD BETWEEN THE TREASURIES AND THE HIGH YIELD. IT'S NOT EXACTLY THE SAME THING. BUT AT THAT TIME, IT'S NOT GOING TO HAPPEN AGAIN, WITH VERY LITTLE RISK. WE MADE IN TWO WEEKS IN '08, OVER A BILLION AND A HALF DOLLARS BECAUSE THE HIGH-YIELDS FELL APART AND WE'RE, WE'RE VERY INVOLVED WITH DEFAULT COMPANIES OR WE USED TO BE. I THINK THAT IS A NO-BRAINER. TALKING ABOUT THE MARKET ITSELF. NOBODY IS SMART ENOUGH TO PICK WHEN THIS MARKET COULD FALL. BUT I DO THINK IT'S OVERHEATED AND A LOT OF THIS MARKET IS BASED ON THE FACT THAT YOU HAVE VERY LOW YIELDS TODAY. AND AGAIN A LOT OF THESE COMPANIES, THESE SUSPECT COMPANIES ARE ABLE TO BORROW MONEY SO CHEAPLY THAT THEY'RE ABLE -- TO GO IN AND BUY OTHER COMPANIES. WHICH THEY WOULDN'T BUY ORDINARILY. AND IF YOU GET ANY TYPE OF A DOWNTURN IN THE ECONOMY, OR A CRISIS, I THINK THERE'S GOING TO BE TROUBLE PAYING THE INTEREST RATES, EVEN THOUGH THEY WERE SO SMALL. AND THEY'RE RELATED TO A LIBRARY AND YOU HAVE A FEDERAL RESERVE, I'M THE LAST TO CRITICIZE THE FEDERAL BECAUSE THEY DID SUCH A GREAT JOB IN 2008. THEY LITERALLY SAVED THE COUNTRY FROM THE SAME PEOPLE, MANY OF THE SAME, I'M NOT CRITICIZING ALL MY FRIENDS AND ALL THAT ON WALL STREET. BUT THE SAME PEOPLE THAT SOLD THE MORTGAGE-BACKED SECURITIES. AND NOW IT'S ALMOST THE SAME THING. IT'S ALMOST DEJA VU. WHERE NOW THEY'RE IN THERE SELLING A LOT OF THESE COMPANIES, SELLING AT HUGE MULTIPLES AND THINK IF YOU LOOK AT SOME OF THESE EARNINGS, THE MARKET IS GOING, S&P 17, 18 TIMES. BUT IF YOU LOOK AT THOSE EARNINGS, AND I'M NOT GOING TO GET INTO IT HERE. I MAY WRITE A PAPER ON IT YOU REALLY SET UP GAP TO PROTECT PEOPLE FROM EARNINGS THAT ARE SORT OF FUDGED. AND YET, YOU'LL GO OUT OR HAVE YOUR THEY DO GAP AND THEN THEY GO OUT ON THE ROAD SHOWS AND EXPLAIN THAT GAP, DON'T WORRY ABOUT GAP. LET'S TALK ABOUT WHAT WE THINK THE EARNINGS ARE. AND THE EARNINGS ARE COMPLETELY CONFUSED. THE CEOs, MANY OF THEM GOOD GUYS, MANY WALL STREET GUYS ARE GOOD GUYS, BUT STILL. A LOT OF THEM ARE SELLING THESE COMPANIES BASED ON THESE EARNINGS.
WAPNER: DO YOU THINK THAT WE'RE GOING TO HAVE A DRAMATIC PULL-BACK IN STOCKS? IT'S MOVED AWAY FROM HIGH YIELD FOR A MOMENT. BUT OVERALL THE U.S. EQUITY MARKET, DO YOU THINK IT'S IN STORE FOR A DRAMATIC PULLBACK?
ICAHN: LOOK, I PERSONALLY DO, BUT I'M NOT -- I WILL TELL YOU TO ME IT'S A NO-BRAINER. I LIKE TO LOOK FOR NO-BRAINERS AND THE HIGH YIELD TO ME IS REALLY A NO-BRAINER. THAT'S GOING TO HAPPEN IN MY MIND. 98%. THE MARKET, HEY SCOTT NOBODY CAN TELL YOU WHEN A MARKET IS GOING TO FALL APART. I DO THINK YOU'RE GOING TO HAVE A DRAMATIC PULLBACK. I THINK CERTAIN THINGS MAY HAPPEN. I THINK THAT THE GOVERNMENT AND THE REGULATORS SHOULD BE LOOKING AT THE WAY EARNINGS ARE REPORTED, EARNING ESTIMATES ARE REPORTED. IN OTHER WORDS COMPANIES GIVE GUIDANCE. YOU'RE LOOKING AT A MARKET I THINK IS GOING THE S&P MUCH HIGHER THAN 17 TIMES AND THEN TO GO BACK TO MY FAVORITE COMPANY, SO IF YOU WANT TO BE IN THE MARKET, A COMPANY LIKE APPLE, I MEAN THERE, TOO, IT'S SORT OF A NO-BRAINER. APPLE, WHERE YOU HAVE GREAT DIFFICULTY COMPETING WITH, IS GOING 9.5 TO 10 TIMES EARNINGS IF YOU MOVE OUT THE CASH. YOU'RE BUYING THAT FOR TEN TIMES EARNINGS WITH A COMPANY THAT WE THINK IS GROWING AT 20 TO 30% GROWTH. AND LOOK AT THE S&P, IT IS GOING TO 17, 18 TIMES EARNINGS, AND THOSE EARNINGS ARE SUSPECT. INTERESTINGLY APPLE IS ONE OF THE VERY FEW COMPANIES THAT DOESN'T STRAY FROM GAP. THEY SAY THIS IS WHAT YOU ARE. THIS IS WHAT WE ARE, THIS IS WHAT YOU GET AND THEY PUT OUT GAP EARNINGS AND STILL 9 TO 10 TIMES EARNINGS AND SO MANY OTHER COMPANIES ARE PUTTING OUT WHAT I CONSIDER TO BE FUDGED EARNINGS. SO I DO THINK SOONER OR LATER, I THINK IT'S AS SIMPLE AS THIS. THAT REGULATORS, IF THEY WANT TO NOT HAVE ANOTHER '07 SHOULD COME IN AND DO SOMETHING ABOUT THE WAY THEY DO GUIDANCE. BECAUSE THE GUIDANCE, FLETCHER MORGANSON WROTE AN INTERESTING PIECE IN THE SUNDAY "TIMES" JUST THIS WEEK DISCUSSING JUST THAT. AND WHEN THEY PUT OUT WHEN THE CEOs ARE TAKING THEIR SHARE OF THE PROFITS SO TO SPEAK, THEY ARE DOING IT OFF EARNINGS THAT I THINK FOR WANT OF A BETTER WORD, ARE PHONY. AND I THINK THAT'S WHAT'S HAPPENING.
WAPNER: AS IT RELATES TO APPLE, WHICH YOU OBVIOUSLY CONTINUE TO LIKE IF THE EQUITY MARKET DOES HAVE AN UPSET, CLEARLY APPLE WILL GET SOLD DOWN LIKE EVERYTHING ELSE WOULD. I'M WONDERING, HAVE YOU TRIMMED YOUR POSITION AT ALL, HOPING TO BUY MORE AT A LOWER LEVEL?
ICAHN: NO, WE HAVEN'T SOLD ONE SHARE OF APPLE. I SAY THAT, I DON'T LIKE TO TALK ABOUT OUR PORTFOLIO. IT'S INTERESTING, I'M TALKING BEARISHLY ABOUT THIS MARKET. I'M TALKING AGAINST MYSELF IN A WAY. WE HAVE MILLIONS OF DOLLARS OF LONG POSITIONS THAT WE OWN. INCLUDING APPLE. AND OUR VERY HEDGE. I STILL HAVE THESE POSITIONS. BUT STILL I HAVE NOT TRIMMED APPLE. BECAUSE I REALLY THINK THAT IF APPLE GOES DOWN, I KNOW IT SOUNDS A LITTLE BIT -- MAY BE HARD TO BELIEVE. BUT IF APPLE GOES DOWN, I'M IN THE THAT UPSET BECAUSE I'LL BUY MORE OF IT AND THAT'S HOW I LOOKED AT THE MARKET ALL THE YEARS I'M IN IT. IF YOU REALLY LOVE A COMPANY, IN A STRANGE, PERVERSE WAY, YOU ALMOST DON'T MIND IT GOING DOWN. APPLE I REALLY WOULDN'T MIND. MOST EVERYTHING ELSE, A LOT OF THE COMPANIES, THE ENERGY SECTOR HAVE REACHED A POINT WHERE I WOULDN'T MIND THEM GOING DOWN, BECAUSE I WOULD BUY MORE OF THEM. AND BY THE WAY, I'M NOT TELLING TO YOU BUY ANY OF THESE STOCKS BECAUSE I DO THINK THEY COULD GO DOWN A BIT MORE. I'M NOT PADDING THE TABLE ON BUT APPLE IS ONE THAT I THINK BECAUSE OF THE BARRIERS TO ENTRY TO THE COMPETITION, MIGHT GO DOWN, SURE. IN A BEAR MARKET I GUESS EVERYTHING GOES. BUT I DO THINK THAT IF YOU'RE LOOKING TO BELONG, THIS IS MY ADVICE FOR WHAT ITS WORTH, YOU WOULD GO LONG APPLE AND HEDGE THEM AGAINST IN SOME WAY AGAINST HIGH-YIELD BONDS, THOSE ARE THE TWO POLAR THINGS I BELIEVE. BUT I REALLY BELIEVE THERE ARE OTHER PEOPLE THAT I TALK TO. I THINK ARE VERY SMART, DIFFERENT GUYS AND ONCE IN A WHILE, THEY SPEAK OUT. AND I SAY TO THEM, WHY DON'T YOU TALK OUT AND SAY WHAT YOU REALLY BELIEVE? WELL, THAT'S NOT WHAT WE DO. BUT I'LL TELL YOU, WE MIGHT HAVE AVOIDED THE CRISIS IT MORE PEOPLE WHO UNDERSTOOD THE HOUSING BUBBLE, WHO UNDERSTOOD THE MORTGAGE-BACKED SECURITIES HAD SPOKEN OUT. NOT LET THOSE THINGS JUST GO TO THE MOON.
WAPNER: WELL LOOK I DO REMEMBER MY FRIEND JIM CRAMER ON THIS VERY NETWORK IN 2007 WITH THE THEY KNOW NOTHING RANT ABOUT THE FED. AT THAT TIME AND HOW THINGS AS HE SAW PERHAPS THEM DEVELOPING. SO SOME FOLKS DID RAISE THEIR HAND AND SCREAM FOR THE HILLS. MAYBE SOME MORE NEED TO AT THIS CURRENT TIME. CARL, YOU KNOW I HAVE A PANEL IN FRONT OF ME AND STEVEN WEISS HAS A QUESTION FOR YOU.
WEISS: CARL, WHERE DO YOU GO, IF YOU'RE THE AVERAGE INVESTOR, SITTING IN CASH IS A LOSING PROPOSITION, THAT DEPRECIATES. BONDS AS YOU POINT OUT, HIGH-YIELD REGULAR BONDS ARE OVERVALUED. WHERE DO YOU GO? DO YOU JUST HEDGE YOUR POSITIONS AND LOOK FOR BOTTOM-UP VALUES LIKE YOU HAVE IN APPLE?
ICAHN: I THINK YOU SAY -- YOU SORT OF PREDICATED THIS A LITTLE BIT ON YOU HAVE TO INVEST. I'M NOT SURE WHY. SO YOU SAY, I SAY TO GOOD FRIENDS OF MINE SOMETIME, YOU KNOW, OH, CHRIST, I CAN'T LIVE ON 1% OR 2%. WHAT DO I DO? I GOT TO BUY STOCKS. I SAID WHAT'S BETTER, WHAT IS BETTER, MAKING 2% OR LOSING 30%? AS PEOPLE DID IN '08. I THINK RIGHT NOW IS A VERY, LIKE MARK TWAIN SAID IT'S ALWAYS DANGEROUS, BUT I THINK RIGHT NOW IT'S AN EXTREMELY DANGEROUS TIME. I THINK AGAIN, NOW, JUST TO KEEP MAYBE BEATING A DEAD HORSE. I THINK APPLE IF YOU BUY IT AND IF GOES DOWN YOU ALMOST WELCOME IT IF YOU CAN AFFORD TO. AND THERE'S A FEW LIKE THAT. I'M NOT GOING TO GO THROUGH EVERY ONE OF THE STOCKS I LIKE. THERE'S A FEW OTHER ONES I THINK ARE GOOD AND KEEP YOUR POWDER DRY. WHY DO YOU HAVE TO OWN ANYTHING. CORPORATE BONDS, SINGLE A CORPORATE BONDS, SEVEN YEARS, HEY, YOU MAKE 3.5%. I DON'T UNDERSTAND WHY ANYBODY WOULD BUY A HIGH-YIELD TO MAKE 5%, TO MAKE 2% MORE, AT THE RISK OF LOSING 40%. I MEAN IT'S JUST NONSENSE. TO ME IT'S A NO-BRAINER. WHY WOULD YOU OWN A HIGH-YIELD AT 5.25. WHEN ANY KIND OF CRISIS IS GOING TO SHAKE THAT TREE BADLY. AND BY THE WAY, EVEN IF THE FED STARTS RAISING RATES, THOSE HIGH YIELD ARE VERY SUSPECT BECAUSE NOW YOU KNOW, A LOT OF PEOPLE THAT DON'T UNDERSTAND THAT REALLY ARE IN THE BOND MARKET IN HIGH YIELD ARE GOING TO RUN TO THE EXITS. RUN ON THE ETF FUNDS THAT I THINK THEY'RE DOING ALREADY. AND THERE'S NOBODY BECAUSE OF THE VOLKER RULES, I DON'T BLAME VOLKER FOR THE VOLKER RULES, I THINK VOLKER HAS DONE A GOOD JOB, BECAUSE OF THOSE RULES BECAUSE OF THAT, THE BANKS ARE NOT A SAFETY NET ANMORE WHO IS GOING TO BUY, WHO IS GOING TO BUY THESE HIGH-YIELD BONDS? I'M SAYING THAT AGAIN AND PEOPLE SHOULD BE WARNED. ACTUALLY RABINI WROTE A GOOD PIECE ON IT FEW WEEKS AGO.
WAPNER: THERE ARE A LOT OF PEOPLE, STEVEN SCHWARTZMAN, A LOT OF PEOPLE ARE STARTING TO SORT OF RING THE BELL ON WHAT'S TAKING PLACE IN THE MARKET. LIQUIDITY ISSUES AS WELL, AS I KNOW THAT YOU KNOW, CARL AND I'M SURE YOU'VE READ MOST OF THOSE PIECES. JOE TERRANOVA HAS A QUESTION FOR YOU.
TERRANOVA: CARL, I APPRECIATE YOU COMING ON AND SPEAKING YOUR MIND, I HAPPEN TO AGREE WITH YOUR POSITION ON THE HIGH-YIELD MARKET. THE QUESTION I HAVE FOR YOU, IS WHEN I TALK TO MANY SPECULATORS THEY SUGGEST THAT THE NEXT LEG OF THIS EQUITY LEG HIGHER AND THE EARNINGS GROWTH IS ACTUALLY GOING TO COME FROM THE REAL ECONOMY RECOVERING. THAT'S THE PREMISE FOR THE FEDERAL RESERVE RAISING RATES. AS YOU SEE IT, DO YOU SEE THE ECONOMY RECOVERING WHEN YOU LOOK AT THE HOUSING AND LABOR? ARE WE REALLY IN A BETTER PLACE AS A COUNTRY, AS AN ECONOMY?
ICAHN: YEAH. LOOK, THE ECONOMY IS FINALLY PICKING UP. I'M NOT SURE THOUGH HOW MUCH OF THAT IS ARTIFICIAL BECAUSE OF LOW INTEREST RATES. YOU SEE MONEY BEING PUT TO WORK. THAT'S GOING TO BRING OUT HIGHER RATES WHICH YOU HAVE TO HAVE. I THINK IT IS VERY, VERY DANGEROUS RIGHT NOW. AGAIN, WHAT'S GOING ON WITH THESE VERY LOW RATES. I THINK THEY ARE MAKING ARTIFICIAL BUBBLES AND WILL CONTINUE TO DO SO. AND THE LONGER YOU WAIT TO TAKE THE PATIENT OFF THE MEDICINE, THE MORE DIFFICULT IT IS GOING TOTO CURTAIL INFLATION WHEN IT COMES AND IT WILL COME. SO WHAT YOU SEE NOW IS SOME HEATING UP IN THE LABOR MARKET. I AM NOT SURE THAT MOST OF THE EARNINGS OF THESE COMPANY AREN'T ARTIFICIAL BASED. WE COULD GO INTO IT FOR HOURS. BASED ON THE FACT THAT YOU CAN BORROW MONEY VERY CHEAPLY, SO YOU BORROW MONEY VERY CHEAPLY AND YOU STIMULATE THE ECONOMY SOMEWHAT BY DOING THAT, YOU ARE BUYING OTHER ASSETS, YOU'RE BUILDING SOME REVENUE AND YOU'RE DOING THAT AND IT IS ARTIFICIAL. BUT ONCE YOU CAN'T BORROW THAT MONEY OR ONCE SOMETHING HITS, I THINK WE'RE IN A VERY UNSTABLE SITUATION, IF THERE'S SOME KIND OF A CRISIS FROM LEFT FIELD OR JUST SIMPLY IT JUST GOES AND HITS A TOP AND COMES DOWN. WHILE THE ECONOMY'S GETTING BETTER, I THINK THE MARKET HAS WAY OVERESTIMATED THE LENGTH THAT THIS WILL STAY FOR.
WAPNER: CARL, FINALLY, TO BRING IT FULL CIRCLE, YOUR REFLECTION ON THE FACT THAT PEOPLE ARE CALLING YOUR TRADE IN NETFLIX ONE OF THE BEST EVER. BY MY ACCOUNT, MORE THAN $2 BILLION IN PROFIT IN THE SPAN OF THREE YEARS.
ICAHN: I WON'T ARGUE WITH THOSE NUMBERS. THEY'RE PUBLIC ANYWAY, I THINK. BUT, LOOK. NETFLIX WAS A NO-BRAINER WHEN WE FIRST WENT INTO IT. NO-BRAINER, COMPLETELY, TOTALLY, BECAUSE PEOPLE NEVER UNDERSTOOD IT. YOU COULDN'T COMPETE WITH NETFLIX BECAUSE THEY WERE STARTING THE YEAR WITH SOMETHING LIKE $2 BILLION FLOWING INTO THEM. AND REED HASTINGS DID A GREAT JOB BUILDING IT UP. A LOT OF PEOPLE QUESTIONED THE FACT HE WENT INTERNATIONALLY BUT WE OBVIOUSLY STUCK WITH HIM. AS SOMEBODY SAID, THIS WAS NEVER AN ACTIVIST PLAY. WE LIKED WHAT REED WAS DOING. EVERYBODY DIDN'T LIKE IT WHEN WE BOUGHT IT. AGAIN, IT WAS A LITTLE SIMILAR TO NETFLIX, PEOPLE WERE TELLING ME GO AFTER REED, GO AFTER REED. AFTER MEETING AND TALKING TO HIM, WE SAID THE GUY HE'S GREAT FOR IT. TIM COOK, A FEW YEARS AGO GO AFTER TIM, AFTER YOU MET TIM, YOU SAID THIS IS THE PERFECT GUY FOR THE JOB. SO YOU KNOW WE ARE NOT ALWAYS CRITICIZING. THERE IS A LITTLE MORE ACTIVISM IN APPLE BECAUSE WE WERE PUSHING SO HARD FOR THEM TO USE THAT CASH -- AND I BELIEVE TO SOME EXTENT THAT I WAS SOMEWHAT RESPONSIBLE FOR THE BUYING A LITTLE MORE STOCK I THINK THEY WOULD AGREE WITH THAT BUT BOTH CASES. THEY HAD GREAT MANAGEMENT TEAMS. WE DIDN'T GO AFTER THEM. IN FACT WE BACKED THEM. WE'RE VERY HAPPY WITH THE NETFLIX TRADE. APPLE IS WHERE NETFLIX WAS BUT APPLE IS EVEN IN A CERTAIN WAY BETTER BECAUSE OF THE BARRIERS FOR COMPETITION THERE. I JUST DON'T SEE HOW -- I HOPE I'M NOT WRONG, BUT I DON'T SEE HOW YOU COMPETE WITH APPLE BECAUSE OF THIS GREAT ECOSYSTEM THEY BUILT. APPLE COULD BE ONE OF THE GREAT STOCKS OF THE CENTURY. NETFLIX OF COURSE ALWAYS HAD THE POSSIBILITY OF COMPETITION WHICH I THINK I ALLUDED TO. BUT BOTH GREAT COMPANIES.
WAPNER: CARL, I APPRECIATE YOUR GRACIOUS TIME TODAY. THANKS SO MUCH. WE'LL SEE YOU SOON. IN FACT I'LL SEE YOU IN A FEW WEEKS AT OUR DELIVERING ALPHA CONFERENCE.
ICAHN: YEAH, OKAY. I'M LOOKING FORWARD TO IT. MAYBE I SHOULDN'T SAY I'M LOOKING FORWARD TO IT. OKAY. ALL RIGHT.
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