Net Net: Promoting innovation and managing change
Net Net: Promoting innovation and managing change

Carl Icahn warns of a Fed 'minefield' ahead

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Activist investor Carl Icahn continues to think bad things lie ahead, even though his last prediction of doom failed to materialize so far.

Icahn repeated his prediction of problems ahead, telling a crowd at the annual DealBook conference Tuesday that he agrees with hedge fund titan Stanley Druckenmiller, who spoke before Icahn and said Federal Reserve policies are going to cause woes for the market.

"There are going to be real problems. We're walking into a minefield of what's going on with the Fed," Icahn said. "I could go on and on here, but I think we have problems."

Icahn released a highly publicized video in late September in which he predicted a sharp market decline ahead fueled in part by speculation and the dangers of junk bonds. He also said corporate earnings are being inflated.

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However, the warning coincided almost perfectly with a near-term market bottom that has seen the rise about 11 percent since.

In addition to reiterating his gloomy outlook, Icahn defended activist investors and in particular his own approach to management. He rattled off a list of companies that Icahn Enterprises has owned for long duration, from 31 years down to a dozen.

Activists are necessary, he said, to improve companies that are being poorly run.

"You don't have corporate democracy. You have people that run companies that aren't bad people but shouldn't be running the companies. They're over their head or they have different agendas," Icahn said. "The reason I made so much money over the years is you hold these people accountable."