Ken Langone On Bailout, Madoff And Santelli 'Populism'
Ken Langone, co-founder of Home Depot and president and CEO of Invemed Associates, appeared on "Squawk Box" this morning and made his feelings known about a bailout nation.
While he says he has faith the Obama team will turn things around, he's not crazy about the way the administration has gone about things so far. He's also against the idea of Rick Santelli style 'populism' that leaves out the middle class.
And in the last video posted here, Langone revisits his story about a pitch from Bernie Madoff. But Langone wasn't buying what Madoff was selling.
"I think the uptick rule should be brought back immediately," says Langone. "This notion that short sellers created the problem is nonsense." In fact, Langone adds, "I think the uptick rule worked." And in case you didn't get his point the first few times, Langone reiterates, "Bring back the uptick rule, leave it that way and let it happen."
"My initial reaction [to the government allowing Lehman to fail] was it was the right thing," Langone says. But after he had a chance to think about it, he says it "probably exacerbated the problem." That said, Langone notes that "If you look at Lehman Brothers' balance sheet and you look at the leverage they had..."
Even Langone admits the length of this crisis has caught him by surprise. "I didn't expect it would continue this long," he says. And he warns about Santelli-style populism. "I think it's dangerous," he says. "I worry about the middle class. I worry about people saying why should I work, let the government do it for me." While he says he understands the government's desire to get this moving. But a quick fix won't work. "This is systemic damage that's been done over a long period of time," he says. "We've gotta go through pain. Let's take the pain, let's get the job done."
Langone heardBernie Madoff's pitch in November of last year, though in an interview with CNBC's Larry Kudlow, he says Madoff never gave a clue he was about to implode. "I wouldn't want to play poker with this guy," Langone said. "He'd clean my clock."
Langone says what turned him off was something Madoff said: "'This fund I'm starting is going to do better than my existing investments.'" Langone wondered how he would feel, "if I was already in and he was doing this to me."