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CNBC Transcript: Carl Icahn, Chairman of Icahn Enterprises, on CNBC’s “Fast Money Halftime Report” Today

WHEN: TODAY, THURSDAY, December 22, 2016

WHERE: CNBC'S "FAST MONEY HALFTIME REPORT"

Following is the unofficial transcript of a CNBC interview with Carl Icahn, Chairman of Icahn Enterprises, on CNBC's "Fast Money Halftime Report" today. Following are links to video of the interview on CNBC.com: http://video.cnbc.com/gallery/?video=3000578438&play=1, http://video.cnbc.com/gallery/?video=3000578447&play=1, http://video.cnbc.com/gallery/?video=3000578450&play=1, http://video.cnbc.com/gallery/?video=3000578458&play=1, http://video.cnbc.com/gallery/?video=3000578459&play=1 and http://video.cnbc.com/gallery/?video=3000578465&play=1.

All references must be sourced to CNBC.

SCOTT WAPNER: AND WELCOME TO "THE HALFTIME REPORT." I'M SCOTT WAPNER. THE DOW CONTINUING ITS MARCH TO 20,000 THIS HOUR. WE BEGIN TODAY WITH A SPECIAL NEWSMAKER INTERVIEW. CARL ICAHN, THE BILLIONAIRE INVESTOR JUST NAMED AS A SPECIAL ADVISER TO PRESIDENT-ELECT TRUMP. MR. ICAHN JOINS US NOW LIVE BY PHONE. CARL, WELCOME BACK. IT'S NICE TO TALK TO YOU TODAY.

CARL ICAHN: YEAH, GOOD TALKING TO YOU, SCOTT.

WAPNER: I THINK PEOPLE HAD BEEN SPECULATING FOR A WHILE WHAT, IF ANY, ROLE YOU WERE GOING TO HAVE WITHIN A TRUMP ADMINISTRATION. NOW WE KNOW IT IS GOING TO BE THE SPECIAL ADVISOR ON REGULATORY REFORM. WHY WERE YOU INTERESTED IN THAT ROLE?

ICAHN: YOU KNOW, I HONESTLY AM SORT OF SURPRISED THAT SO MUCH IS BEING MADE OF MY BEING NAMED TO THAT. I DON'T THINK IT REALLY CHANGES WHAT I'VE BEEN DOING. YOU KNOW, I'VE KNOWN DONALD FOR YEARS. I THINK DONALD'S AN EXTREMELY BRIGHT GUY. I BACKED HIM FOR THE PRESIDENCY. AND, I MEAN, IT'S ALMOST LIKE TALKING ABOUT -- I KNOW THERE'S TALKS ABOUT CONFLICTS AND I'M SURE THAT YOU'RE GOING TO TALK ABOUT THAT AND I'LL JUST SAY THIS, THAT IT'S ALMOST AS RIDICULOUS AS SAYING, YOU KNOW, IF -- THAT DONALD SHOULDN'T TALK TO A JAMIE DIMON OR A BRIAN MOYNIHAN ABOUT BANK REGULATION BECAUSE THEY'RE CEOs OF A BANK. I DO OWN COMPANIES IN EVERY AREA, BUT AS FAR AS I'M CONCERNED I DON'T HAVE ANY SPECIFIC DUTIES. WHAT I'M GOING TO BE DOING IS BASICALLY TALKING TO DONALD AS I'VE TALKED BEFORE AND I DO THINK IT'S IMPORTANT, EXTREMELY IMPORTANT, FOR THIS COUNTRY THAT THIS ABSURD REGULATORY ENVIRONMENT IS TONED DOWN SOMEWHAT. I'M NOT AGAINST REGULATIONS AT ALL. I SORT OF BELIEVE THAT YOU NEED A RULE OF LAW. BUT IT'S BECOME LITERALLY ABSURD IN MANY AREAS. AND IT'S SORT OF LIKE COMPANIES THAT I'VE BEEN INVOLVED IN ALL MY LIFE, YOU KNOW. OVER THE LAST 30, 40 YEARS AND PRETTY SUCCESSFULLY CLEANING UP COMPANIES. THERE ARE GOOD COMPANIES, GOOD CEOs AS THERE ARE GOOD REGULATIONS. BUT THERE ARE SOME THAT ARE COMPLETELY ABSURD IN COMPANIES JUST AS IN THE GOVERNMENT. AND, YOU KNOW, FRANKLY YOU ALMOST GET ENRAGED BY SOME OF THE STUFF. THAT'S WHAT I'LL BE DOING.

WAPNER: WHAT EXACTLY WILL YOU BE DOING? I MEAN HOW DO YOU ANTICIPATE THIS ROLE PLAYING OUT FOR YOU? AND WHAT SPECIFIC REGULATIONS WILL YOU TARGET? MR. TRUMP HIMSELF HAS PLEDGED TO WIPE OUT A NUMBER OF REGULATIONS. NOW YOU'RE THE GUY IN CHARGE OF SUGGESTING WHICH ONES SPECIFICALLY. WHICH ONES WILL THEY BE?

ICAHN: WELL I BASICALLY TALKED TO DONALD BEFORE ABOUT IT. A LOT OF WHAT I COULD CONSIDER TO BE TOP CEOs ARE TALKING ABOUT WHAT I THINK HAMPERS OUR ECONOMY GREATLY. IF YOU LOOK AT THE EPA, WHICH, YOU KNOW, I'VE TALKED ABOUT QUITE A BIT, THERE IS NOTHING MORE ABSURD, AND I'VE TALKED ABOUT THIS BEFORE, THAN THIS REGULATION CONCERNING THE OBLIGATED PARTY BEING REFINERIES. THEY SAY, WELL -- THEY COME UP AND I THINK TAKE DIRECTION AT THE EPA FROM -- I DON'T WANT TO DEMEAN THEM BUT -- SOME 25-YEAR-OLD GUYS THAT ARE.. ABOUT THE ENVIRONMENT AND THERE IS NOTHING WRONG WITH SAYING WE WANT TO GET CLEANER AIR. BUT THERE IS SOMETHING VERY WRONG IN OUR ECONOMY, AND I THINK WE'RE GOING TO PAY A BIG PRICE FOR IT IF YOU DON'T HAVE HEALTHY REFINERIES.

WAPNER: HOW QUICKLY DO YOU EXPECT A ROLL BACK OF SOME OF THE EPA REGULATIONS GIVEN THE FACT THAT YOU WERE INSTRUMENTAL IN THE CHOICE OF MR. PRUITT TO LEAD THAT AGENCY?

ICAHN: YEAH, AND I BELIEVE THAT IN THE EPA CONCERNING REGULATIONS RELATIVE TO REFINERIES, YOU REALLY NEED TO ROLL BACK ALMOST YESTERDAY. YOU HAVE TO HAVE HEALTHY REFINERIES AND IT ALMOST IS ANTITHETICAL BECAUSE THERE ARE REFINERIES ON THE BRINK OF BANKRUPTCY TODAY AND, AS YOU PROBABLY KNOW, A SLIGHT CHANGE -- A SLIGHT CHANGE IN THE AMOUNT OF GASOLINE THAT COULD BE PRODUCED ESPECIALLY ON THE EAST COAST IS GOING TO POSSIBLY SPIKE GASOLINE PRICES. AND I THINK, YOU KNOW, THIS IS SORT OF LIKE WHAT HAPPENED IN '08 WHEN -- YOU KNOW, I'M NOT LOOKING TO PAT MYSELF ON THE BACK -- BUT I WAS ONE OF THE PEOPLE WARNING, AND THERE WERE OTHER SMART GUYS WARNING, ABOUT THE ABUSE OF MORTGAGE-BACKED SECURITIES, AND IT'S ALMOST THE SAME THING. IT SORT OF GROWS ON YOU. EVERYBODY SORT OF KNOWS, YEAH, IT'S CRAZY, BUT NOBODY DOES ANYTHING ABOUT IT UNTIL IT'S TOO LATE. AND IT IF YOU LOOK AT THE MODEL THAT YOU HAVE, AT THE EPA, IT'S REALLY INSANE BECAUSE TO GO AND SAY THAT -- IT'S ALMOST LAUGHABLE. YOU GO AND SAY REFINERIES SHOULD BE OBLIGATED TO ENSURE THAT A CERTAIN AMOUNT OF ETHANOL IS BLENDED, THE REASON THAT'S INSANE IS THAT NOBODY WILL BUY BLENDED GASOLINE FROM REFINERIES. WHEN I SAY NOBODY, YOU CAN SELL SOME. SO HOW CAN YOU BE OBLIGATED TO GO AND DO SOMETHING AND BLEND SOMETHING WHEN THE GAS STATIONS PROFIT IMMENSELY FROM NOT BUYING BLENDED GASOLINE BECAUSE OF THESE CRAZY REGULATIONS THAT THEY HAVE?

WAPNER: THE OTHER BIG REGULATION PEOPLE HAVE BEEN TALKING ABOUT AND WE'VE SORT OF SEEN THE WAY THAT THE BANKS HAVE TRADED SINCE MR. TRUMP WAS ELECTED PRESIDENT IS DODD/FRANK. WHAT DOES DODD/FRANK LOOK LIKE UNDER A SPECIAL ADVISOR ICAHN?

ICAHN: YEAH, WELL, LOOK, AS FAR AS DODD/FRANK IS CONCERNED – LET ME SAY SOMETHING. I TALKED TO DONALD. I'M RUNNING A LOT OF COMPANIES AND DONALD IS A VERY SMART GUY. I WILL SAY THAT DONALD IS AN EXTREMELY INTELLIGENT GUY AND HE'S HIS OWN MAN. AND I WILL CONTINUE TO TALK TO HIM AND THE REASON THAT I THINK IT'S GOOD THAT I HAVE A TITLE LIKE THIS IS I'VE BEEN GETTING QUESTIONS – AND I DON'T THINK IT DOES ANYBODY GOOD – ALMOST EVERY DAY. YOU KNOW, WHAT ROLE AM I TAKING? WHAT AM I DOING? OH, I HEAR YOU TALKED TO DONALD YESTERDAY. WHAT ARE YOU DOING? ARE YOU TALKING TO HIM? AND THIS WAY, YEAH I'M TALKING TO HIM. I'M AN ADVISOR IN THIS AREA TO HIM. AND I INTEND TO SPEND A LOT OF TIME ON TRYING TO CLEAN UP THIS MAJOR PROBLEM IN OUR ECONOMY. AND IT'S REALLY AS SIMPLE AS THAT.

WAPNER: DO YOU THINK THERE ARE TOO MANY REGULATIONS ON THE BANKS?

ICAHN: YEAH, THERE IS TOO MUCH REGULATION ON THE BANKS. AND THE GREAT EXPERTS ON THAT THOUGH ARE THE PEOPLE I MENTIONED, LIKE THE JAMIE DIMONS, THE BRIAN MOYNIHANS. AND IT'S ALMOST AS RIDICULOUS TO SAY YOU SHOULDN'T BE ALLOWED TO TALK TO THEM BECAUSE THEY'RE THE CEOs OF THE BANK. I MEAN, THAT'S THE PROBLEM WITH THIS WHOLE ADMINISTRATION FOR THE LAST EIGHT YEARS. THAT THE ADVICE IS COMING -- AND I DON'T DEMEAN THESE PEOPLE -- BUT FROM 25-YEAR-OLD KIDS WHO HAVE THIS OUTSIZE SAY IN WHAT IS GOING ON. AND THE AMAZING THING IN A LOT OF THESE AGENCIES IS THE PEOPLE AT THE TOP OF THEM ARE NOT EXPERTS IN THOSE AREAS. AND I WANT TO GET BACK TO ONE POINT. THAT IN OUR ECONOMY TODAY YOU MUST HAVE -- AND NOT JUST WITH REFINERIES – YOU KNOW, BY THE WAY, DONALD HAS SAID MANY TIMES HE'S VERY -- HE BELIEVES IT'S VERY IMPORTANT TO HAVE THESE REFINERIES -- THAT YOU MUST HAVE INVESTMENTS IN THESE COMPANIES AND WE DON'T GET THE INVESTMENTS BECAUSE OF CRAZY REGULATIONS. I MEAN RINs, IS ALMOST A SUBJECT THAT'S SO INSANE TO HAVE RINs TRADED. TO BEGIN WITH, THEY TRADE IT IN AN UNREGULATED BLACK POOL MARKET WHERE SPECULATORS ARE MAKING A FORTUNE, WHERE GAS STATION CHAINS ARE MAKING A FORTUNE AT THE EXPENSE OF REFINERIES AND EVEN THE EPA THEMSELVES SAY THAT THE MODEL ISN'T WORKING AND IT DOES NO GOOD FOR ANYONE -- IT DOESN'T DO GOOD FOR THE GOVERNMENT. IT DOESN'T DO GOOD EVEN FOR CLEAN AIR. IN FACT, IT HURTS CLEAN AIR BECAUSE REFINERIES, A LOT OF THEM DON'T HAVE THE CAPITAL TO INVEST IN UPDATING THEIR OWN REFINERIES. SO THIS THING SHOULD BE DEALT WITH IMMEDIATELY. IT SHOULD BE, FIRST OF ALL, THE TRADING WITH THIRD PARTIES AND IT WAS NEVER IN THE LAW. FOR SOME REASON THE EPA AND THEIR GREAT WISDOM DECIDED TO LET THIRD PARTIES SPECULATORS BUY THESE RINs. THAT SHOULD BE DONE AWAY IMMEDIATELY AND THEN WE SHOULD MOVE ON INTO DOING MORE OF THAT REGULATION. BUT THEY SHOULD DO AWAY WITH THE TRADING. THEY SHOULDN'T ALLOW THIRD PARTIES TO BUY IN A BLACK POOL WHERE THERE'S NO TRANSPARENCY. I MEAN, YOU CAN GO ON AND ON ON HOW INSANE THAT IS. THAT'S MY QUINTESSENTIAL EXAMPLE OF WHAT'S WRONG IN REGULATIONS. BUT YOU HAVE THAT ALL OVER. NOW YOU'RE GOING TO SAY, WELL, CARL ICAHN OWNS COMPANIES. YEAH, I OWN COMPANIES IN EVERY AREA. BUT THAT'S LIKE SAYING I CLEANED UP, SAY, TEXACO YEARS AGO, I DID REYNOLDS TOBACCO, I DID FOREST LABS. SHELL HAS MADE HUNDREDS OF BILLIONS OF DOLLARS ON THIS. BUT NONE OF THEM COMPLAIN ABOUT THE FACT THAT, YOU KNOW, CARL ICAHN REALLY DID THE CLEAN UP ON THEM OR HELPED TO CLEAN THEM UP. WELL NOBODY COMPLAINED THAT CARL ICAHN OWNS STOCK. I'VE NEVER HEARD ONE SHAREHOLDER SAY, WELL YOU KNOW, WE'VE MADE A LOT OF MONEY, CARL, BUT WE DON'T LIKE THE FACT YOU OWNED THE STOCK. YEAH, I'M IN THESE COMPANIES BUT I DON'T INTEND TO TAKE – IN OTHER WORDS, IT'S ALMOST LIKE SAYING YOU SHOULDN'T LISTEN TO JAMIE DIMON OR BRIAN MOYNIHAN ABOUT BANKING REGULATIONS BECAUSE THEY HAVE VESTED INTEREST IN OPTIONS ON THE BANK. IT'S SORT OF A CRAZY ISSUE. I FIGURED YOU'D BRING IT UP AND I JUST WANT TO PREEMPT IT.

WAPNER: I KNOW, I UNDERSTAND, BUT I MEAN YOU CAN CERTAINLY UNDERSTAND THAT YOU REFERENCED IT RIGHT OFF THE BEGINNING PART OF OUR INTERVIEW ABOUT THIS CONFLICT OF INTEREST QUESTION.

ICAHN: WELL, IT'S BEEN BROUGHT UP SEVERAL TIMES. AND I KNOW YOU, I KNOW YOU WOULD BRING IT UP SOONER OR LATER SO I PREEMPTED IT.

WAPNER: I'LL TAKE THAT AS A COMPLIMENT. I MEAN, SOME WOULD SAY, THOUGH, SHOULD THE GUY WHO OWNS A CVR ENERGY, FOR EXAMPLE, A REFINER, BE HELPING SHAPE AN ISSUE THAT DIRECTLY AFFECTS THE REFINING INDUSTRY?

ICAHN: I WOULD ASK YOU, SHOULD JAMIE DIMON BE DISCUSSING REGULTIONS AT THE BANK -- BANK REGULATIONS BECAUSE HE'S ALSO THE CEO OF JP MORGAN? IT'S ALMOST A CRAZY ISSUE IF YOU THINK OF IT THAT WAY. I MEAN, I AM NOT – YOU KNOW, I CAN UNDERSTAND SAYING THAT I SHOULDN'T BE INVOLVED IN OWNING THESE IF I WERE MAKING POLICY. IF I WERE THERE -- AS IS TRUE OF CABINET MEMBERS, YOU KNOW, THAT ARE REALLY MAKING POLICY. I'M NOT MAKING ANY POLICY. I'M JUST --

WAPNER: WELL, YOU'RE HELPING PICK SOME OF THE PEOPLE WHO ARE FORMING THE POLICY.

ICAHN: WELL, I GIVE MY OPINION ON THAT. AND I THINK I'M GOOD AT THAT. I MEAN, OVER THE YEARS, YOU DEVELOP INSTINCTS ON PICKING THE RIGHT CEO. YOU'RE NEVER GOING TO BE RIGHT ALL THE TIME. I PRIDE MYSELF ON PICKING SOME REAL GOOD CEOs. I HELPED TO PICK THE CEO OF MOUNT SINAI THAT'S DONE THE CITY A GREAT DEAL OF GOOD BY COMING IN AND CLEANING UP MOUNT SINAI. SO IS THERE ANYTHING WRONG WITH ME SAYING THIS GUY IS THE RIGHT GUY FOR THIS JOB AT THIS TIME AND IT DOESN'T MEAN DONALD IS GOING TO TAKE MY ADVICE NECESSARILY. I'M NOT THE GUY SAYING, WELL, HE HAS THE JOB. IT'S A WHOLE BIG ISSUE. BUT I THINK MAYBE WE'RE MISSING A MAJOR POINT HERE. THERE'S A MAJOR PROBLEM IN THIS COUNTRY BECAUSE WE DON'T HAVE INVESTMENTS, ALRIGHT? WE LACK CORPORATE INVESTMENTS AND YOU CAN'T GET AROUND IT. YOU KNOW, THE MARKET IS GOOD NOW, BUT I THINK PART OF THAT IS BECAUSE YOU HAD VERY LOW INTEREST RATES OVER THE YEARS, BUT WE CAN'T COMPETE IN THIS COUNTRY AND WE CAN'T REALLY GIVE GOOD JOBS TO THE MIDDLE CLASS BECAUSE CORPORATIONS PERCEIVE THEMSELVES AT WAR WITH THE GOVERNMENT. AND YOU CAN'T CHANGE THAT PERCEPTION UNTIL YOU CLEAN THIS MESS UP. AND IT MAY SOUND CORNY BUT I CAME FROM MIDDLE CLASS FAMILY, LOWER MIDDLE CLASS IN QUEENS. AND I MADE ALL THIS MONEY AND ENJOYED SUCCESS. I'M A WORKAHOLIC SO I DON'T REALLY SPEND THE MONEY TOO MUCH BUT BASICALLY I FEEL -- AND I KNOW IT SOUNDS CORNY, MAYBE, BUT I REALLY FEEL THAT IT'S SORT OF A DUTY TO GIVE SOMETHING BACK HERE AND I THINK I HELPED TO CLEAN UP A LOT OF COMPANIES. I THINK IT DID A LOT OF GOOD, IT ENHANCED A LOT OF VALUE AND A LOT OF PRODUCTIVITY. AND NOW I THINK I CAN DO A LOT OF GOOD IN MY MIND TO KEEP RALLYING AGAINST THIS OVERREGULATION THAT WE HAVE BECAUSE IF YOU CONTINUE TO HAVE THIS – AND CONTINUE TO HAVE THESE 25-YEAR-OLD KIDS TELLING BUSINESSES HOW TO BE RUN, YOU'RE NOT GOING TO GET BUSINESSES THEMSELVES TO INVEST IN THEIR OWN COMPANIES.

WAPNER: LET ME ASK YOU ANOTHER THING. I COULDN'T HELP BUT NOTICE TODAY, SPEAKING OF REGULATION AND THE WAY THAT THE MARKETS HAVE BEEN REACTING, THAT A NUMBER OF ETF COMPANIES' SHARES WERE DOWN TODAY, WHETHER IT WAS BLACKROCK OR WISDOM TREE. THERE ARE REPORTS THAT YOU'VE BEEN INSTRUMENTAL IN INTERVIEWING POTENTIAL PEOPLE TO BE THE SEC CHAIR. I WONDER IF THOSE STOCKS IN ANY WAY COULD BE REACTING TO SOMETHING THAT THE SEC COULD PUT INTO PLACE. YOU HAVE ARGUED VOCIFEROUSLY ON THIS NETWORK ABOUT LIQUIDITY ISSUES THAT YOU BELIEVE EXIST IN THE WAY ETFs TRADE. I'M JUST WONDERING IF YOU THINK THAT ETFs NEED STRONGER REGULATION OR NOT.

ICAHN: DON'T CONFUSE THE SEC, AS FAR AS I'M CONCERNED, WITH THE ETFs GOING DOWN. I MEAN, THE ETFs GO DOWN WITH THE MARKET AND GO UP WITH THE MARKET. NOW I THINK YOU'VE HIT ON ANOTHER POINT THAT IN SOME WAY DIGRESSES FROM REGULATION. I THINK THE ETFs – I'VE SAID A LONG TIME THAT IT'S DANGEROUS TO HAVE ALL THIS MONEY DAMMED UP IN THESE ETFs. I'VE SAID IT ON YOUR, I THINK ON SEEKING ALPHA OR WHATEVER IT WAS, WAY BACK.

WAPNER: YEAH, DELIVERING ALPHA.

ICAHN: DELIVERING ALPHA WITH LARRY FINK, WHO I RESPECT A LOT BUT, YOU KNOW DISAGREE WITH ON THESE. I THINK WITH WHAT'S GOING ON IN THE MARKET TO SOME EXTENT IS EVERYBODY IS VERY POSITIVE ABOUT DONALD WINNING. AND I DO THINK THIS. OVER THE NEXT FOUR YEARS DONALD WILL BE SUCCESSFUL. HE'S A SMART GUY AND HE'S GOING TO GET THINGS DONE. BUT IN THE MARKET TODAY, THE DANGER IS THAT YOU HAVE ALL THIS MONEY POURING IN AMERICA INTO ETFs AND ETFs ARE SORT OF ALMOST BLIND BUYING. YOU JUST BUY THESE ETFs AND I ALWAYS QUESTION THE FACT THAT IF YOU'RE BUYING THESE STOCKS AND YOU REALLY DON'T KNOW WHAT YOU OWN, YOU'RE PRONE TO THESE PERIODS OF TIME -- THERE COULD BE SOME KIND OF CRISIS AND THERE COULD BE A PROBLEM.

WAPNER: WHAT KIND OF PERSON ARE YOU LOOKING FOR, FOR THE SEC?

ICAHN: I WOULD LIKE TO SEE AT THE SEC, AND I THINK THIS IS VERY IMPORTANT TO THE ECONOMY TOO, AND I'VE SAID THIS FOR YEARS AND YEARS AND YEARS, THERE SHOULD BE MORE ACCOUNTABILITY IN CORPORATE AMERICA IN PUBLIC COMPANIES. IF YOU REALLY LOOK AT WHAT HAPPENS IN MANY COMPANIES, AND I'VE SAID IT MANY TIMES, IT'S NOT A SURPRISE, THAT YOU BUILD UP A WALL AGAINST ACCOUNTABILITY. YOU HAVE A SYSTEM WHERE -- AND I DON'T THINK ANYBODY -- VERY FEW PEOPLE WILL ARGUE WITH ME, THAT YOU HAVE MANY, MANY, MANY GOOD CEOs AND GOOD BOARDS AND GOOD COMPANIES BUT YOU HAVE MANY -- TOO MANY WHERE CEOs SHOULD BE REMOVED AND ACCOUNTABLE, JUST LIKE YOU WOULD BE REMOVED FROM YOUR JOB IF YOU DIDN'T DO THE RIGHT JOB AT CNBC. I LIKE TO THINK THAT YOU'RE DOING VERY WELL THERE. BUT WHAT I'M SAYING TO YOU IS YOU REALLY SHOULD HAVE MORE ACCOUNTABILITY AND GET SOMEBODY IN THE SEC WHO IS A CHAIRMAN. NOW THAT IS GOING TO ALSO STIMULATE INVESTMENT AND STIMULATE THE BUYING OF STOCKS. IF YOU FEEL THAT, IN CERTAIN AREAS, AT TIMES YOU CAN REALLY HOLD THE FEET TO THE FIRE OF THE CEO. AND IT'S LIKE IN ANY BUSINESS, LOOK AT PRIVATE BUSINESSES. IF YOU LOOK AT PRIVATE BUSINESSES, YOU LOOK AT THEIR PRODUCTIVITY, THEY'RE MUCH HIGHER UNLESS THERE'S NEPOTISM, BUT A FAMILY-OWNED BUSINESS. PRODUCTIVITY, IT'S UNQUESTIONABLE, IS MUCH HIGHER THAN IN MANY PUBLIC COMPANIES SO THE REASON FOR THAT IS THAT THERE IS ACCOUNTABILITY. IF YOU HAVE A FAMILY COMPANY AND THE COMPANY IS DOING BADLY, THE FAMILY GETS TOGETHER AND DECIDES TO REMOVE THE CEO AND GET ANOTHER ONE, THERE'S NO BIG DEAL, THERE'S NO BIG FIGHT. THERE'S NO RULES AND I THINK THE FEDERAL GOVERNMENT CAN AND SHOULD GET MORE INVOLVED IN ACCOUNTABILITY.

WAPNER: DO YOU HAVE A PERSON IN MIND ALREADY?

ICAHN: NO, I DON'T WANT TO GET INTO THAT. OBVIOUSLY I HAVE AN OPINION. AND THERE AGAIN, IT'S ALMOST RIDICULOUS TO SAY WELL, I'M GOING TO GIVE MY OPINION TO DONALD BUT I SHOULDN'T BECAUSE I OWN STOCKS. IT'S LIKE, TO ME, CRAZY.

WAPNER: ON THAT NOTE, TODAY IN THE "USA TODAY," SINCE YOU'RE BRINGING IT UP, A SECURITIES LAWYER WAS QUOTED SAYING THE FOLLOWING. I WOULD LIKE YOUR REACTION TO IT. THEY SAY, QUOTE, IT IS VERY DISCONCERTING AND TROUBLING TO PEOPLE WHO TAKE INVESTOR PROTECTION ISSUES SERIOUSLY – THIS IS TALKING ABOUT YOUR NEW JOB. IT'S A LITTLE LIKE ASKING THE FOX TO GUARD THE HEN HOUSE.

ICAHN: DID THAT COME FROM A SECURITIES LAWYER?

WAPNER: IT DID.

ICAHN: I DON'T UNDERSTAND IT. I'VE MADE HUNDREDS OF BILLIONS OF DOLLARS FOR SHAREHOLDERS OVER THE LAST 30 YEARS. HOW IS THAT THE FOX GOING AGAINST THE HENS, IF YOU WANT TO SAY IT THAT WAY? I GUESS THAT'S WHAT HE'S ALLUDING TO. I DON'T EVEN UNDERSTAND THE STATEMENT BECAUSE I JUST LOOK AT MY RECORD AND YOU GO FROM TIME WARNER TO REYNOLDS TOBACCO TO FOREST LABS, JUST TO NAME A FEW THAT I COULD JUST THINK OF OFF-HAND, AND THERE ARE 30 OF THEM, WHERE WE MADE HUNDREDS OF BILLIONS FOR SHAREHOLDERS AND NOW YOU'RE GOING TO SAY THAT MY BEING INVOLVED IN ASKING FOR MORE ACCOUNTABILITY OR THINKING THIS COUNTRY SHOULD HAVE IT, AND MY BEING INVOLVED SOMEHOW IS GOING TO HURT, I JUST DON'T UNDERSTAND THE CRITICISM. MAYBE YOU CAN EXPLAIN IT.

WAPNER: IT SEEMS TO CENTER AROUND THE SEC IN PARTICULAR. THAT YOU AS A BIG INVESTOR WOULD HAVE A ROLE IN PICKING THE PERSON WHO SHAPES THE POLICY COULD BENEFIT WALL STREET.

ICAHN: FIRST OF ALL, DONALD IS A VERY STRONG PERSONALITY AND HE HAS OTHER ADVISORS SO I'M CERTAINLY NOT GOING TO -- I'M NOT IN A POSITION WHICH I THINK YOU'RE ALLUDING TO THAT I COULD GO IN AND SAY, HEY, THIS IS THE GUY THAT'S GOING TO RUN THE SEC. AND IT'S NOT GOING TO HAPPEN THAT WAY. I TALK TO DONALD AND THERE'S NOTHING WRONG WITH TALKING HIM AND I'M REALLY SURPRISED THAT WE'RE GETTING INTO THIS KIND OF A DISCUSSION. BUT BEING THAT SAID, I DO BELIEVE, AND I'VE SAID THIS PUBLICLY, IT'S NOTHING TO DO WITH MY APPOINTMENT, IF IT IS AN APPOINTMENT -- IT'S MORE OR LESS ALMOST DOING THE SAME THING I DO NOW, IS TALK TO DONALD FROM TIME TO TIME. BUT I WOULD TELL YOU I'VE ALWAYS SAID THAT IF YOU REALLY WANT THIS COUNTRY TO BE MORE PRODUCTIVE AND BRING ABOUT MORE JOBS, YOU HAVE TO HAVE BETTER ACCOUNTABILITY IN CORPORATE AMERICA AND THE REASON I MAKE SO MUCH MONEY OVER THE YEARS AND, LOOK, I THINK BECAUSE OF MY RECORD -- I'M NOT TRYING TO BOAST, BUT IF I LOOKED BACK AT MY RECORD AND SINCE '68, I BELIEVE I'VE ANNUALIZED 28% RETURN. SOME YEARS I MADE 500%, SOME YEARS I LOST, BUT BASICALLY I AM VERY PROUD OF THAT. ONE OF THE REASONS IS I'VE BEEN ABLE TO SEE THE UNIQUE VALUES IN CERTAIN COMPANIES THAT WERE HIDDEN AND ONE OF THE VALUES THAT IN A LOT OF THE COMPANIES, NOT ALL OF THEM BUT A LOT OF THEM, IS I SEE IT THE FACT THAT IF YOU COULD ONLY GET RID OF THE MANAGEMENT, GET MANAGEMENT TO GET OFF THE GOLF COURSE, YOU'RE GOING TO MAKE THIS COMPANY A LOT BETTER. AND THAT MEANS ITS MORE PRODUCTIVE, IT'S GOING TO CREATE MORE JOBS. AND THIS MIGHT SURPRISE YOU. I REALLY THINK THERE SHOULD BE SOME TYPE OF REGULATIONS AGAINST -- AND I KNOW THIS WILL SURPRISE YOU BECAUSE I WANT TO MAKE IT CLEAR. THERE ARE COMPANIES THAT HAVE VERY STRONG BALANCE SHEETS AND PLENTY OF CASH OR PLENTY OF ABILITY TO BUY BACK STOCK AND THAT'S FINE. BUT A LOT OF COMPANIES BORROW MONEY OR HAVE TOO MUCH DEBT ON THE BALANCE SHEET AND YET USE THAT MONEY THAT THEY GET TO BUY BACK STOCKS INSTEAD OF INVESTING IN THEIR OWN COMPANIES. AND THAT IN SOME WAY SHOULD BE CONTROLLED BECAUSE THAT IS ONE OF THE REASONS -- I'M TALKING ABOUT, LOOK, DONALD WANTS TO GET MORE JOBS IN THIS COUNTRY. THAT'S A SIMPLE GIVEN. AND TO GET MORE JOBS, YOU HAVE TO INVEST IN THESE COMPANIES, AND YOU HAVE TO INVEST IN THE BRICK AND MORTAR STUFF, TOO. YOU CAN'T JUST BE TALKING ABOUT, YOU KNOW, EVERYBODY IS GOING TO GO AND TEXT EACH OTHER OR, YOU KNOW, PUT OUT THINGS AND, THEREFORE, IF YOU WANT THAT TO HAPPEN, IN MANY COMPANIES YOU MUST HAVE MORE DEDICATED CEOs OR BETTER CEOs AND, ALSO, BOARDS SHOULD BE HELD ACCOUNTABLE. BOARDS ARE THE HOLY COW WHERE YOU GO IN AND YOU -- THE COMPANY CAN BE DOING TERRIBLE. SO THE BOARD WAKES UP ONE DAY AND SAYS LOOK, WE'LL FIRE THE CEO, AREN'T WE WONDERFUL. THOSE BOARD MEMBERS ARE GETTING E $300,000 OR $400,000 A YEAR.

WAPNER: YOU JUST USED THE WORD "CONTROLLED" WHEN TALKING ABOUT COMPANIES TAKING MONEY AND BUYING BACK STOCK RATHER THAN REINVESTING IT IN THE BUSINESS. ARE YOU SUGGESTING THAT YOU THINK THERE NEEDS TO BE SOME KIND OF REGULATION AGAINST COMPANIES FROM BUYING BACK TOO MUCH OF THEIR STOCK INSTEAD OF INVESTING IN THE BUSINESS?

ICAHN: NO, I'M NOT SAYING THAT, BUT THERE WOULD BE WAYS, AND I'M NOT GOING TO GO INTO IT, WHERE YOU COULD INCENTIVIZE A COMPANY TO INVEST IN THEIR OWN BUSINESSES RATHER THAN BUY BACK STOCK. I MEAN, AND THERE ARE WAYS TO DO IT, AND I'M NOT GOING TO GO INTO THE DETAILS. I'VE THOUGHT ABOUT THIS A LONG TIME, THAT IF YOU WANT TO SEE OUR COUNTRY PROSPER, WE MUST HAVE INVESTMENT AND THE ONLY WAY WE'RE GOING TO HAVE INVESTMENT -- YOU CAN'T DEPEND ON THE GOVERNMENT TO GO IN AND, AGAIN, I AM THE OPPOSITE OF SOCIALISM, OBVIOUSLY, SO YOU DON'T WANT BIG GOVERNMENT COMING IN AND SAYING HERE'S MONEY, GO DO THIS AND DO THAT, AS MUCH AS THE AMOUNTS -- ACTUALLY, IRONICALLY HILLARY CLINTON SAID IT, THAT YOU HAVE TO UNLEASH THIS GREAT AMOUNT OF CAPITAL HELD IN THE COMPANIES TO INVEST, BUT THEN IN THE NEXT SENTENCE THAT SPEECH SHE GAVE, WHICH IS COMPLETELY RIGHT, YOU HAVE TO DO THAT, SHE SAYS WE MUST REGULATE THEM AND WE MUST TAX THEM SO WHY THE HELL ARE THEY GOING TO INVEST? THAT WAS THE PROBLEM WITH THE HILLARY CLINTON MESSAGE. SO I AM SAYING TO GET THEM TO INVEST, TO GET COMPANIES TO INVEST, TO GET PEOPLE TO INVEST IN THESE COMPANIES, TO BUILD THIS BRICK AND MORTAR WHICH WILL CREATE JOBS, WHAT WE'RE DOING IN THIS COUNTRY, WHAT WE'VE BEEN DOING IS THE OPPOSITE. WE'VE BEEN SCARING BUSINESS. WE'VE BEEN OVERREGULATING THEM. AND SO YOU TAKE AN INVESTMENT BANKER WHO OBVIOUSLY -- THERE'S NOTHING WRONG WITH THIS. EVERYBODY IS SUSCEPTIBLE BECAUSE THEY'RE COMPETITIVE AND THEY WORK – THEY WANT TO PROSPER, SO THE INVESTMENT BANKERS GO TO THE CEO OF COMPANIES AND SAY, LOOK, INSTEAD OF INVESTING IN CAPITAL, WHY DON'T YOU JUST BUY BACK YOUR STOCK, AND IN THREE YEARS YOU'LL BE OUT OF HERE AND MAKE $50 MILLION AND NOBODY WILL CRITICIZE YOU. INSTEAD OF BUILDING A NEW FACTORY OR NEW MACHINERY WHICH WILL ACTUALLY HELP THE PRODUCTIVITY WHICH WE NEED SO BADLY IN THIS COUNTRY, INSTEAD OF THAT, JUST BUY BACK STOCK. AND THAT ADVICE IS LISTENED TO BECAUSE THE CEO PERHAPS RIGHTLY SO, SAYS, HEY LOOK, IF I BUILD ANOTHER FACTORY, I GOT THESE 25-YEAR-OLD GUYS COMING IN AND TELLING ME HOW TO RUN MY COMPANY AND REGULATE ME SOME MORE. IF I BUY STOCK, THE STOCK WILL GO UP, I'LL INVEST, MY OPTIONS MAKE $50 MILLION OR PLAY GOLF THE REST OF MY LIFE. AND THAT IS WHAT HAPPENS IN CORPORATE AMERICA AND I AM TELLING YOU -- AND I THINK DONALD LISTENS TO ME TO SOME EXTENT BECAUSE I'VE LIVED IT FOR 30 YEARS AND I WORK LIKE HELL AT EVERYTHING AND I UNDERSTAND IT. AND, YOU KNOW, YOU CAN TAKE THESE FACTS THAT I'M TALKING ABOUT, AND DONALD IS VERY GOOD AT THIS AND I THINK I'M GOOD AT IT, AND DEDEUCE SIMPLE CONCLUSIONS FROM THESE FACTS. THE SIMPLE CONCLUSION IS, WE'RE OVERREGULATED. I GO BACK TO MY QUINTESSENTIAL EXAMPLE –

WAPNER: SURE.

ICAHN: OF WHAT YOU HAVE TO DO WITH THE EPA, WE'RE OVERREGULATED. THAT'S ONE OF THE THINGS STANDING IN THE WAY OF INVESTMENT. ANOTHER THING STANDING IN THE WAY OF INVESTMENT IS THAT WE DON'T HOLD OUR MANAGEMENTS OR BOARDS ACCOUNTABLE ENOUGH AND I MADE THE MONEY BECAUSE I'VE HELD THEM ACCOUNTABLE. I'VE BEEN ABLE TO DO IT. THERE ARE VERY FEW PEOPLE -- AND I'M NOT PROUD -- I'M NOT PATTING MYSELF ON THE BACK FOR THIS BUT VERY FEW PEOPLE HAVE THE POWER TO DO WHAT I DO. YOU KNOW, HAVING THE MONEY AND THE CAPABILITY TO GO IN AND SAY TO THE CEO, IT MAY TAKE ME FOUR YEARS OR FIVE YEARS, THAT'S WHY HEDGE FUNDS HAVE DIFFICULTY BEING ACTIVISTS. IT MAY TAKE YOU FIVE, SIX YEARS TO GET THEM TO DO WHAT YOU WANT BUT YOU KNOW IN THE BACK OF YOUR MIND, YOU'RE LOOKING AT A COMPANY, AND I'M GOOD AT ANALYZING THEM, I GUESS, OVER THE YEARS AND THEN YOU SAY LOOK, SOONER OR LATER WE'LL UNCOVER THE VALUE OF THESE COMPANIES AND THAT'S WHAT I DO. IT SHOULDN'T HAVE TO BE JUST ME DOING IT. WE SHOULD BE ABLE TO DO THAT THROUGH -- IN OTHER WORDS, THE GOVERNMENT PROTECTS THESE GUYS. THE GOVERNMENT SHOULD NOT BE PROTECTING THESE CEOs THAT ARE NOT DOING THEIR JOB. AND I WANT TO MAKE IT CLEAR AGAIN, THERE ARE MANY CEOs DOING A GREAT JOB. OKAY? SO I'M NOT HEAR TO SAY – JUST AS THERE ARE VERY GOOD REGULATIONS -- I'M NOT SAYING DON'T REGULATE.

WAPNER: UNDERSTOOD. A COUPLE QUICK THINGS I WANT TO DO AND THEN I WANT TO TAKE A QUICK BREAK AND COME BACK AND TALK TO YOU ABOUT THIS AMAZING RALLY THAT WE'VE HAD IN THE STOCK MARKET SINCE THE ELECTION. BUT QUICKLY BEFORE WE TAKE A BREAK, CARL, JUST BACK TO THE SEC QUESTION FOR A SECOND, DO YOU THINK IT'S IMPERATIVE THAT WHOEVER RUNS THE SEC NEXT COMES FROM WALL STREET OR HAS WALL STREET EXPERIENCE?

ICAHN: NO, I DON'T THINK SO. I THINK -- BUT I DO THINK – AND THIS IS WHAT I WOULD TELL DONALD. I THINK HE WOULD LISTEN AND MAYBE HE WON'T, IS THAT YOU NEED MORE ACCOUNTABILITY. THAT'S ALL I'M SAYING. BUT HEY, I DON'T KNOW THAT DONALD IS GOING TO LISTEN TO ME AND IT'S LUDICROUS TO SAY WEL, YOU SHOULDN'T ADVISE HIM ON THIS BECAUSE YOU OWN STOCKS. IT'S SORT OF ALMOST ABSURD. IT'S LIKE SAYING IF YOU'VE BEEN SUCCESSFUL YOU CAN'T ADVISE THE PRESIDENT.

WAPNER: THE OTHER ISSUE I WANTED TO ASK YOU ABOUT IS PETER NAVARRO, WHO OUR VIEWERS KNOW WELL -- I'M NOT SURE HOW WELL, IF AT ALL, YOU KNOW MR. NAVARRO, NAMED OBVIOUSLY TO THE NATIONAL TRADE COUNCIL. AND I'M JUST WONDERING SORT OF IN THE CONTEXT IF THERE'S BEEN SUCH AN ERA OF GOOD FEELING IF YOU WANT TO CALL IT THAT SINCE ELECTION DAY, STOCK MARKET HAS RIPPED UP, THE DOW JONES INDUSTRIAL AVERAGE IS ON THE CUSP OF 20,000. I JUST WONDER IF THERE'S ANYTHING THAT YOU WORRY SUCH AS A TRADE WAR WITH CHINA, FOR EXAMPLE. MR. NAVARRO HAS TAKEN A VERY HARD LINE STANCE AGAINST CHINA, HE'S WRITTEN A BOOK "DEATH BY CHINA." HOW SHOULD INVESTORS BE THINKING ABOUT THAT VERY ISSUE CONSIDERING THE RHETORIC THAT THE PRESIDENT-ELECT HIMSELF HAS SAID DURING THE CAMPAIGN AND PERHAPS AFTER?

ICAHN: WELL, THAT'S A BIG QUESTION. DO YOU WANT TO ANSWER IT NOW OR TAKE YOUR BREAK?

WAPNER: YOU KNOW WHAT, LET'S DO THAT. OUR ADVERTISERS APPRECIATE YOU.

WAPNER: WE'RE BACK NOW WITH THE BILLIONAIRE INVESTOR CARL ICAHN. CARL, THANK YOU FOR TAKING THE QUICK BREAK. DO YOU WANT TO ANSWER THAT QUESTION NOW ABOUT HOW INVESTORS SHOULD BE THINKING ABOUT THAT VERY TOPIC?

ICAHN: WELL, LOOK, YOU KNOW, NOBODY CAN PICK WHAT THE MARKET IS GOING TO DO IN THE SHORT TERM. TOO MANY VARIABLES. I DO BELIEVE THAT THIS MARKET HAS BEEN VERY SURPRISING IN THAT IT'S RUN AHEAD SO QUICKLY. I THINK THE S&P INTEREST FROM THAT NIGHT WHEN DONALD WAS ELECTED IS UP OVER 10%. SO, YOU KNOW, I WOULD TELL YOU THAT YOU HAVE TO BE -- I BELIEVE THAT YOU HAVE TO BE VERY VERY WARY BECAUSE THERE ARE SO MANY UNCERTAINTIES AROUND NOW. INDEED, I WAS WAITING TO GO ON AND I WATCHED ART CASHIN SPEAKING A BIT AND I THINK HE SAID PRETTY MUCH THE SAME THING. THAT OBVIOUSLY IF YOU HAVE A TRADE WAR WITH CHINA, BY DEFINITION, I REMEMBER THE DAY SOMETHING LIKE THAT WOULD REALLY KNOCK THE HELL OUT OF THE MARKET BUT MAYBE IF YOU'RE GOING TO DO IT YOU SHOULD GET IT OVER WITH, RIGHT? AND SO THAT'S A CONSIDERATION. I MEAN, YOU HAVE TO JUST MAKE UP YOUR MIND IF THIS IS WHAT YOU'RE GOING TO DO, YOU GO DO IT. OBVIOUSLY YOU RESPECT WHAT PETER NAVARRO SAYS QUITE A BIT AND I'M NOT REALLY –

WAPNER: YOU WOULD WELCOME IT?

ICAHN: I'M NOT GOING TO IN ANY WAY OPINE ON WHETHER WE SHOULD HAVE A TRADE WAR WITH CHINA. THAT'S ABOVE MY PAY GRADE. I'M NOT GOING TO GET INTO THAT. LOOK, I SORT OF -- ONE OF THE –

WAPNER: I JUST THINK IF YOU LOOK AT WHAT'S HAPPENED SINCE THE ELECTION IT AT THE WAY THAT THE MARKET HAS REACTED WITHOUT ANYTHING EVEN BEING PASSED, THE PRESIDENT IS NOT EVEN IN OFFICE YET, AND YOU LOOK AT MAYBE SOME OF THE POTENTIAL RISKS THAT ARE OUT THERE, MAYBE A TRADE WAR WITH CHINA IS ONE OF THEM, MAYBE ANOTHER ONE IS THE FUTURE OF THE FEDERAL RESERVE. I'M WONDERING IF PRESIDENT-ELECT TRUMP CALLED YOU UP AND SAID, CARL, WHAT DO YOU THINK WE SHOULD DO WITH THE FED, SHOULD FED CHAIR YELLEN STAY ON UNTIL THE END OF HER TERM, WHAT WOULD YOU SUGGEST?

ICAHN: LOOK, I TOLD YOU FOR THE LAST YEAR, YEAR AND A HALF, TWO YEARS, THAT HAVING THESE INTEREST RATES SO LOW IS A MISTAKE, IN MY MIND. THAT I CAN TALK ABOUT A LITTLE BIT. I THINK IT'S BUILT TREMENDOUS BUBBLES IN OUR ECONOMY, IN OUR ASSET PRICES, AND EVEN IN THE STOCK MARKET. SO I'M NOT GOING TO TALK ABOUT THE FACT THAT SHE SHOULD RESIGN. THAT'S UP TO DONALD. I MEAN, THAT'S NOT UP TO ME TO DISCUSS WHAT YOU DO ABOUT CHINA AND YELLEN. BUT I DO BELIEVE T WAS ILL THOUGHT OUT, IN MY MIND, TO KEEP THESE INTEREST RATES SO LOW AND, BY THE WAY, THAT'S WHY IN MY MIND THIS ECONOMY IS DOING WELL. IT'S NOT DOING WELL AGAIN BECAUSE WE PRODUCED. IT'S NOT DOING WELL BECAUSE WE'RE PRODUCTIVE BECAUSE WE'RE NOT PRODUCTIVE. OUR WORKERS' PRODUCTIVITY – THE GROWTH IN PRODUCTIVITY IS AT THE LOW END OF THE DECADE. I WOULD TELL YOU THAT SOONER OR LATER YOU PAY THE PRICE FOR THESE LOW INTEREST RATES AND REALLY THAT'S ONE OF YOUR THOUGHTS HERE THAT THESE INTEREST RATES ARE MOVING UP VERY QUICKLY AND THEN AS THEY MOVE UP, CAN YOU CONTROL INFLATION? YOU HAVE SO MANY VARIABLES, SO MANY THINGS TO WORRY ABOUT. AND THEN I DON'T REALLY TALK ABOUT SHORT-TERM THINGS IN THE MARKET, BUT ONE OF THE THINGS THAT CONCERNS ME, OR YOU MIGHT TALK ABOUT IS THE FACT THERE'S BEEN A LACK OF SELLING OVER THE LAST FEW WEEKS. ONE REASON IS BECAUSE IF IT YOU'RE AN INVESTOR YOU'RE THINKING TO YOURSELF, WELL LOOK, IT'S 50/50, IS THE MARKET GOING UP OR DOWN? WHY DON'T I WAIT UNTIL JANUARY WHEN I PAY LESS TAXES ON MY GAINS? I HAVE GAINS IN A LOT OF THINGS NOW. WHY SHOULD I TAKE THEM NOW WHEN IF I SELL THEM IN JANUARY I DON'T HAVE TO PAY TAX THIS YEAR, NEXT YEAR, AND I CAN PAY LESS TAX. THERE'S A LACK OF STOCK FOR SALE AND YET ON THE BUY SIDE MONEY KEEPS POURING IN FROM WHAT I CONSIDER A LOT OF INVESTORS THAT REALLY DON'T STUDY THE MARKET AND THEY'RE GIVING IT TO PEOPLE -- AND I DON'T BLAME THEM BUT THEY'RE GIVING IT TO A BUYER OF AN ETF THAT BLINDLY BUYS IT THERE'S NOTHING WRONG WITH THAT BUT THEY TELL YOU THEY BUY IT THROUGH A BLACK BOX. SO THERE'S NOBODY REALLY DECIDING, IS THIS A GOOD STOCK, IS THIS A GOOD VALUE? CAN YOU DECIDE IF IT IS A GOOD VALUE IN THE SHORT TERM PROBABLY NOT THOSE ARE THE THINGS THAT CONCERN ME QUITE A BIT.

WAPNER: DO YOU THINK SOME OF THIS RALLY WE'VE SEEN SINCE ELECTION DAY REALLY ON THE EUPHORIA OF WHAT A TRUMP PRESIDENCY COULD MEAN FOR ECONOMIC GROWTH, FOR THE MARKET, CORPORATE PROFITS, EARNINGS, ET CETERA, IT'S UNJUSTIFIED THAT PEOPLE SHOULD NOT BE BUYING STOCKS IN THE MAGNITUDE IN WHICH THEY HAVE?

ICAHN: I DON'T WANT TO SAY THAT. I THINK -- I THINK THAT – I WANT TO MAKE IT CLEAR. DONALD BEING ELECTED IS A POSITIVE THING. WE LAUGHED ABOUT IT. I LEFT THE PARTY AND WENT HOME AND BOUGHT STOCK THAT NIGHT. I THINK IT'S A POSITIVE THING NOT A NEGATIVE THING. WHEN THE MARKET WENT DOWN 1,000 POINTS, IT WAS INSANE. THE NO-BRAINERS I TALK ABOUT. AND I THINK DONALD WILL BE VERY GOOD FOR THIS ECONOMY AND THAT IT WILL WORK OUT, BUT IF YOU LOOK AT THE MARKET, I DON'T THINK ANYONE IS GOING TO TELL THAT YOU IN TWO WEEKS, THREE WEEKS IT WENT UP 12% OR SOMETHING LIKE THAT. THAT IS A VERY DANGEROUS CONCEPT TO THINK WELL THE MARKET IS UP 12% , WHY? WHY DID IT SUDDENLY IT TURN AROUND? I MEAN, BEFORE -- WHAT WAS? BEFORE DONALD WAS ELECTED YOU HAD VERY SMART PEOPLE SAYING IF DONALD IS ELECT THIS HAD MARKET WILL GO DOWN, IT'S GOING TO GET KILLED. SUDDENLY, OH, ISN'T IT WONDERFUL THE SAME PEOPLE NOW ISN'T IT WONDERFUL, JUST KEEP BUYING STOCKS. AND NOW THE ANALYSTS ALL TELL YOU IT'S GREAT AND I DO THINK IT'S GOOD. IF YOU LOOK AHEAD FOUR YEARS, THREE YEARS, I THINK THAT'S THE TELLING TIME. I THINK DONALD WILL SUCCEED. I CAN TELL YOU I HAVE KNOWN HIM FOR YEARS HE'S A VERY SMART GUY AND HAS A GOOD -- WHAT HE CAN DO, AND I THINK THIS IS A COMMON DENOMINATOR FOR SUCCESSFUL PEOPLE, HE'S ABLE TO TAKE FACTS AND REALLY DEDUCE A SIMPLE AND LOGICAL CONCLUSION. I THINK I CAN DO THAT AND OTHER VERY SUCCESSFUL PEOPLE I KNOW CAN DO THAT AND NOT GET SIDE TRACKED BY THE PERIPHERAL NONSENSE. YOU WANT JOBS, YOU HAVE TO HAVE INVESTMENT, YOU WANT INVESTMENT GET RID OF THE REGULATIONS SIMPLE, SIMPLE, SIMPLE. SO I'M SAYING TO YOU I THINK HE WILL SUCCEED AND WILL GET THIS ECONOMY BACK ON TRACK. GET RID OF THE WEALTH GAP THAT IS SO CRAZY. I MEAN THE IRONY IS THE DEMOCRATS WHO WERE SUPPOSED TO BE FOR THE LITTLE GUY, THE WEALTH GAP HAS NEVER BEEN WIDER. THERE ARE SO MANY THINGS HERE. TO GET BACK TO YOUR POINT, ARE YOU ASKING ME –

WAPNER: YOU DON'T SOUND LIKE THE KIND OF GUY WHO RIGHT NOW WANTS TO PUSH FRESH MONEY TO WORK IN THE MARKET GIVEN HOW FAST AND HOW FAR ITS TRADED . AM I WRONG?

ICAHN: I AM A DIFFERENT KIND OF INVESTOR ANYWAY I DON'T' HEDGE I DON'T PLAY THE MARKET GOING UP OR DOWN TOO MUCH.

WAPNER: BUT YOU SAID NOT THAT LONG AGO THAT YOU WERE MORE HEDGE THAN YOU'VE EVER BEEN. ARE YOU LESS HEDGE NOW BECAUSE YOU HAVE A BETTER FEELING ABOUT WHERE THE MARKET IS AND IT CAN GO?

ICAHN: WELL IF YOU WANT TO ASK ME TWO WEEKS AGO OR TODAY IT'S A DIFFERENT ANSWER. AS THE MARKET HAS BEEN RUNNING UP LIKE THIS I'VE BECOME MORE HEDGED. THAT BEING SAID, I STILL BUY A LOT OF THINGS I THINK ARE VERY CHEAP. YOU CAN'T ASK ME TO TELL YOU WHAT YOU SHOULD DO AS FAR AS TRADING THE MARKET. I DON'T REALLY TRADE THE MARKET. AS FAR AS I'M CONCERNED – I MEAN, LOOK, YOU LISTEN TO SOME SMART PEOPLE -- ART CASHIN AND OTHER GUYS, YOU HAVE TO BE CONCERNED. IF YOU'RE NOT CONCERNED YOU'RE JUST LIVING IN EUPHORIA. PEOPLE ARE, I GUESS. I'M CONCERNED ABOUT A LOT OF THINGS THAT HAPPEN. BUT THUS DOES NOT MEAN AND I WANT TO MAKE IT CLEAR AND MAYBE THE HEADLINES WILL GET THIS WRONG IF I COMES OUT, I DO BELIEVE THAT DONALD BEING ELECTED PRESIDENT WAS EXTREMELY POSITIVE. EXTREMELY POSITIVE IF HE WASN'T ELECTED AND YOU HAD FOUR MORE YEARS OF WHAT WE WERE DOING, WE WERE MOVING ON A FAST TRACK TO SOCIALISM WHICH I DO NOT BELIEVE WORKS. IT WAS EXTREMELY POSITIVE THAT HE WAS ELECTED AND I THINK HE'S GOING TO DO A VERY GOOD JOB THAT'S WHAT I BELIEVE. IF YOU'RE ASKING ME DO I BELIEVE NEXT WEEK THE MARKET IS GOING UP, I THINK YOU HAVE TO BE CONCERNED.

WAPNER: NO IT SOUNDS TO ME LIKE YOU COULD BE SAYING NEXT WEEK COULD BE GOING DOWN NOT UP.

ICAHN: I DON'T WANT TO PREDICT.

WAPNER: YOU KNOW WHAT I MEAN I AM NOT TALKING DAY TO DAY OR WEEK TO WEEK.

ICAHN: I BELIEVE WHAT WAS GOING ON WITH THE OBAMA REGIME, THEY'RE NOT BAD PEOPLE, BUT WHAT WAS GOING ON WAS VERY DANGEROUS FOR THE ECONOMY, NOW I DON'T BELIEVE IT'S THAT DANGEROUS ANYMORE WITH THE NEW REGIME AND WITH DONALD. BUT IF YOU ARE ASKING ME AM I CONCERNED ABOUT THE MARKET IN THE SHORT TERM, YEAH, I'M CONCERNED ABOUT IT. IT'S AS SIMPLE AS THAT AND YOU DON'T NEED ME TO TELL YOU THAT. YOU CAN LOOK AT SO MANY FACTORS HERE YOU HAVE TO WORRY ABOUT. OBVIOUSLY IF YOU GET INTO A TRADE WAR WITH CHINA, SOONER OR LATER WE'LL HAVE TO COME TO GRIPS WITH THAT MAYBE IT IS BETTER TO DO IT SOONER. THAT'S NOT MY DECISION AT ALL I DON'T GET INVOLVED WITH THAT.

WAPNER: CARL, I APPRECIATE YOUR TIME. THANK YOU FOR SPENDING A GOOD CHUNK OF YOUR LUNCH HOUR WITH US TODAY.

ICAHN: YEAH, OKAY. YOU CAN'T ANSWER THAT WITH FIVE WORDS. I'LL WAIT FOR YOU

WAPNER: FAIR ENOUGH. WE'LL TAKE A QUICK BREAK AND COME BACK WITH MORE ON CARL ICAHN, ON THAT ANSWER AND THEN THE MARKETS AND THIS RALLY THAT WE'VE SEEN, AS WELL. WE'RE BACK AFTER THIS.

WAPNER: WE'RE BACK NOW WITH THE BILLIONAIRE INVESTOR CARL ICAHN. CARL, THANK YOU FOR TAKING THE QUICK BREAK. DO YOU WANT TO ANSWER THAT QUESTION NOW ABOUT HOW INVESTORS SHOULD BE THINKING ABOUT THAT VERY TOPIC?

ICAHN: WELL, LOOK, YOU KNOW, NOBODY CAN PICK WHAT THE MARKET IS GOING TO DO IN THE SHORT TERM. TOO MANY VARIABLES. I DO BELIEVE THAT THIS MARKET HAS BEEN VERY SURPRISING IN THAT IT'S RUN AHEAD SO QUICKLY. I THINK THE S&P INTEREST FROM THAT NIGHT WHEN DONALD WAS ELECTED IS UP OVER 10%. SO, YOU KNOW, I WOULD TELL YOU THAT YOU HAVE TO BE -- I BELIEVE THAT YOU HAVE TO BE VERY VERY WARY BECAUSE THERE ARE SO MANY UNCERTAINTIES AROUND NOW. INDEED, I WAS WAITING TO GO ON AND I WATCHED ART CASHIN SPEAKING A BIT AND I THINK HE SAID PRETTY MUCH THE SAME THING. THAT OBVIOUSLY IF YOU HAVE A TRADE WAR WITH CHINA, BY DEFINITION, I REMEMBER THE DAY SOMETHING LIKE THAT WOULD REALLY KNOCK THE HELL OUT OF THE MARKET BUT MAYBE IF YOU'RE GOING TO DO IT YOU SHOULD GET IT OVER WITH, RIGHT? AND SO THAT'S A CONSIDERATION. I MEAN, YOU HAVE TO JUST MAKE UP YOUR MIND IF THIS IS WHAT YOU'RE GOING TO DO, YOU GO DO IT. OBVIOUSLY YOU RESPECT WHAT PETER NAVARRO SAYS QUITE A BIT AND I'M NOT REALLY –

WAPNER: YOU WOULD WELCOME IT?

ICAHN: I'M NOT GOING TO IN ANY WAY OPINE ON WHETHER WE SHOULD HAVE A TRADE WAR WITH CHINA. THAT'S ABOVE MY PAY GRADE. I'M NOT GOING TO GET INTO THAT. LOOK, I SORT OF -- ONE OF THE –

WAPNER: I JUST THINK IF YOU LOOK AT WHAT'S HAPPENED SINCE THE ELECTION IT AT THE WAY THAT THE MARKET HAS REACTED WITHOUT ANYTHING EVEN BEING PASSED, THE PRESIDENT IS NOT EVEN IN OFFICE YET, AND YOU LOOK AT MAYBE SOME OF THE POTENTIAL RISKS THAT ARE OUT THERE, MAYBE A TRADE WAR WITH CHINA IS ONE OF THEM, MAYBE ANOTHER ONE IS THE FUTURE OF THE FEDERAL RESERVE. I'M WONDERING IF PRESIDENT-ELECT TRUMP CALLED YOU UP AND SAID, CARL, WHAT DO YOU THINK WE SHOULD DO WITH THE FED, SHOULD FED CHAIR YELLEN STAY ON UNTIL THE END OF HER TERM, WHAT WOULD YOU SUGGEST?

ICAHN: LOOK, I TOLD YOU FOR THE LAST YEAR, YEAR AND A HALF, TWO YEARS, THAT HAVING THESE INTEREST RATES SO LOW IS A MISTAKE, IN MY MIND. THAT I CAN TALK ABOUT A LITTLE BIT. I THINK IT'S BUILT TREMENDOUS BUBBLES IN OUR ECONOMY, IN OUR ASSET PRICES, AND EVEN IN THE STOCK MARKET. SO I'M NOT GOING TO TALK ABOUT THE FACT THAT SHE SHOULD RESIGN. THAT'S UP TO DONALD. I MEAN, THAT'S NOT UP TO ME TO DISCUSS WHAT YOU DO ABOUT CHINA AND YELLEN. BUT I DO BELIEVE T WAS ILL THOUGHT OUT, IN MY MIND, TO KEEP THESE INTEREST RATES SO LOW AND, BY THE WAY, THAT'S WHY IN MY MIND THIS ECONOMY IS DOING WELL. IT'S NOT DOING WELL AGAIN BECAUSE WE PRODUCED. IT'S NOT DOING WELL BECAUSE WE'RE PRODUCTIVE BECAUSE WE'RE NOT PRODUCTIVE. OUR WORKERS' PRODUCTIVITY – THE GROWTH IN PRODUCTIVITY IS AT THE LOW END OF THE DECADE. I WOULD TELL YOU THAT SOONER OR LATER YOU PAY THE PRICE FOR THESE LOW INTEREST RATES AND REALLY THAT'S ONE OF YOUR THOUGHTS HERE THAT THESE INTEREST RATES ARE MOVING UP VERY QUICKLY AND THEN AS THEY MOVE UP, CAN YOU CONTROL INFLATION? YOU HAVE SO MANY VARIABLES, SO MANY THINGS TO WORRY ABOUT. AND THEN I DON'T REALLY TALK ABOUT SHORT-TERM THINGS IN THE MARKET, BUT ONE OF THE THINGS THAT CONCERNS ME, OR YOU MIGHT TALK ABOUT IS THE FACT THERE'S BEEN A LACK OF SELLING OVER THE LAST FEW WEEKS. ONE REASON IS BECAUSE IF IT YOU'RE AN INVESTOR YOU'RE THINKING TO YOURSELF, WELL LOOK, IT'S 50/50, IS THE MARKET GOING UP OR DOWN? WHY DON'T I WAIT UNTIL JANUARY WHEN I PAY LESS TAXES ON MY GAINS? I HAVE GAINS IN A LOT OF THINGS NOW. WHY SHOULD I TAKE THEM NOW WHEN IF I SELL THEM IN JANUARY I DON'T HAVE TO PAY TAX THIS YEAR, NEXT YEAR, AND I CAN PAY LESS TAX. THERE'S A LACK OF STOCK FOR SALE AND YET ON THE BUY SIDE MONEY KEEPS POURING IN FROM WHAT I CONSIDER A LOT OF INVESTORS THAT REALLY DON'T STUDY THE MARKET AND THEY'RE GIVING IT TO PEOPLE -- AND I DON'T BLAME THEM BUT THEY'RE GIVING IT TO A BUYER OF AN ETF THAT BLINDLY BUYS IT THERE'S NOTHING WRONG WITH THAT BUT THEY TELL YOU THEY BUY IT THROUGH A BLACK BOX. SO THERE'S NOBODY REALLY DECIDING, IS THIS A GOOD STOCK, IS THIS A GOOD VALUE? CAN YOU DECIDE IF IT IS A GOOD VALUE IN THE SHORT TERM PROBABLY NOT THOSE ARE THE THINGS THAT CONCERN ME QUITE A BIT.

WAPNER: DO YOU THINK SOME OF THIS RALLY WE'VE SEEN SINCE ELECTION DAY REALLY ON THE EUPHORIA OF WHAT A TRUMP PRESIDENCY COULD MEAN FOR ECONOMIC GROWTH, FOR THE MARKET, CORPORATE PROFITS, EARNINGS, ET CETERA, IT'S UNJUSTIFIED THAT PEOPLE SHOULD NOT BE BUYING STOCKS IN THE MAGNITUDE IN WHICH THEY HAVE?

ICAHN: I DON'T WANT TO SAY THAT. I THINK -- I THINK THAT – I WANT TO MAKE IT CLEAR. DONALD BEING ELECTED IS A POSITIVE THING. WE LAUGHED ABOUT IT. I LEFT THE PARTY AND WENT HOME AND BOUGHT STOCK THAT NIGHT. I THINK IT'S A POSITIVE THING NOT A NEGATIVE THING. WHEN THE MARKET WENT DOWN 1,000 POINTS, IT WAS INSANE. THE NO-BRAINERS I TALK ABOUT. AND I THINK DONALD WILL BE VERY GOOD FOR THIS ECONOMY AND THAT IT WILL WORK OUT, BUT IF YOU LOOK AT THE MARKET, I DON'T THINK ANYONE IS GOING TO TELL THAT YOU IN TWO WEEKS, THREE WEEKS IT WENT UP 12% OR SOMETHING LIKE THAT. THAT IS A VERY DANGEROUS CONCEPT TO THINK WELL THE MARKET IS UP 12% , WHY? WHY DID IT SUDDENLY IT TURN AROUND? I MEAN, BEFORE -- WHAT WAS? BEFORE DONALD WAS ELECTED YOU HAD VERY SMART PEOPLE SAYING IF DONALD IS ELECT THIS HAD MARKET WILL GO DOWN, IT'S GOING TO GET KILLED. SUDDENLY, OH, ISN'T IT WONDERFUL THE SAME PEOPLE NOW ISN'T IT WONDERFUL, JUST KEEP BUYING STOCKS. AND NOW THE ANALYSTS ALL TELL YOU IT'S GREAT AND I DO THINK IT'S GOOD. IF YOU LOOK AHEAD FOUR YEARS, THREE YEARS, I THINK THAT'S THE TELLING TIME. I THINK DONALD WILL SUCCEED. I CAN TELL YOU I HAVE KNOWN HIM FOR YEARS HE'S A VERY SMART GUY AND HAS A GOOD -- WHAT HE CAN DO, AND I THINK THIS IS A COMMON DENOMINATOR FOR SUCCESSFUL PEOPLE, HE'S ABLE TO TAKE FACTS AND REALLY DEDUCE A SIMPLE AND LOGICAL CONCLUSION. I THINK I CAN DO THAT AND OTHER VERY SUCCESSFUL PEOPLE I KNOW CAN DO THAT AND NOT GET SIDE TRACKED BY THE PERIPHERAL NONSENSE. YOU WANT JOBS, YOU HAVE TO HAVE INVESTMENT, YOU WANT INVESTMENT GET RID OF THE REGULATIONS SIMPLE, SIMPLE, SIMPLE. SO I'M SAYING TO YOU I THINK HE WILL SUCCEED AND WILL GET THIS ECONOMY BACK ON TRACK. GET RID OF THE WEALTH GAP THAT IS SO CRAZY. I MEAN THE IRONY IS THE DEMOCRATS WHO WERE SUPPOSED TO BE FOR THE LITTLE GUY, THE WEALTH GAP HAS NEVER BEEN WIDER. THERE ARE SO MANY THINGS HERE. TO GET BACK TO YOUR POINT, ARE YOU ASKING ME –

WAPNER: YOU DON'T SOUND LIKE THE KIND OF GUY WHO RIGHT NOW WANTS TO PUSH FRESH MONEY TO WORK IN THE MARKET GIVEN HOW FAST AND HOW FAR ITS TRADED . AM I WRONG?

ICAHN: I AM A DIFFERENT KIND OF INVESTOR ANYWAY I DON'T' HEDGE I DON'T PLAY THE MARKET GOING UP OR DOWN TOO MUCH.

WAPNER: BUT YOU SAID NOT THAT LONG AGO THAT YOU WERE MORE HEDGE THAN YOU'VE EVER BEEN. ARE YOU LESS HEDGE NOW BECAUSE YOU HAVE A BETTER FEELING ABOUT WHERE THE MARKET IS AND IT CAN GO?

ICAHN: WELL IF YOU WANT TO ASK ME TWO WEEKS AGO OR TODAY IT'S A DIFFERENT ANSWER. AS THE MARKET HAS BEEN RUNNING UP LIKE THIS I'VE BECOME MORE HEDGED. THAT BEING SAID, I STILL BUY A LOT OF THINGS I THINK ARE VERY CHEAP. YOU CAN'T ASK ME TO TELL YOU WHAT YOU SHOULD DO AS FAR AS TRADING THE MARKET. I DON'T REALLY TRADE THE MARKET. AS FAR AS I'M CONCERNED – I MEAN, LOOK, YOU LISTEN TO SOME SMART PEOPLE -- ART CASHIN AND OTHER GUYS, YOU HAVE TO BE CONCERNED. IF YOU'RE NOT CONCERNED YOU'RE JUST LIVING IN EUPHORIA. PEOPLE ARE, I GUESS. I'M CONCERNED ABOUT A LOT OF THINGS THAT HAPPEN. BUT THUS DOES NOT MEAN AND I WANT TO MAKE IT CLEAR AND MAYBE THE HEADLINES WILL GET THIS WRONG IF I COMES OUT, I DO BELIEVE THAT DONALD BEING ELECTED PRESIDENT WAS EXTREMELY POSITIVE. EXTREMELY POSITIVE IF HE WASN'T ELECTED AND YOU HAD FOUR MORE YEARS OF WHAT WE WERE DOING, WE WERE MOVING ON A FAST TRACK TO SOCIALISM WHICH I DO NOT BELIEVE WORKS. IT WAS EXTREMELY POSITIVE THAT HE WAS ELECTED AND I THINK HE'S GOING TO DO A VERY GOOD JOB THAT'S WHAT I BELIEVE. IF YOU'RE ASKING ME DO I BELIEVE NEXT WEEK THE MARKET IS GOING UP, I THINK YOU HAVE TO BE CONCERNED.

WAPNER: NO IT SOUNDS TO ME LIKE YOU COULD BE SAYING NEXT WEEK COULD BE GOING DOWN NOT UP.

ICAHN: I DON'T WANT TO PREDICT.

WAPNER: YOU KNOW WHAT I MEAN I AM NOT TALKING DAY TO DAY OR WEEK TO WEEK.

ICAHN: I BELIEVE WHAT WAS GOING ON WITH THE OBAMA REGIME, THEY'RE NOT BAD PEOPLE, BUT WHAT WAS GOING ON WAS VERY DANGEROUS FOR THE ECONOMY, NOW I DON'T BELIEVE IT'S THAT DANGEROUS ANYMORE WITH THE NEW REGIME AND WITH DONALD. BUT IF YOU ARE ASKING ME AM I CONCERNED ABOUT THE MARKET IN THE SHORT TERM, YEAH, I'M CONCERNED ABOUT IT. IT'S AS SIMPLE AS THAT AND YOU DON'T NEED ME TO TELL YOU THAT. YOU CAN LOOK AT SO MANY FACTORS HERE YOU HAVE TO WORRY ABOUT. OBVIOUSLY IF YOU GET INTO A TRADE WAR WITH CHINA, SOONER OR LATER WE'LL HAVE TO COME TO GRIPS WITH THAT MAYBE IT IS BETTER TO DO IT SOONER. THAT'S NOT MY DECISION AT ALL I DON'T GET INVOLVED WITH THAT.

WAPNER: CARL, I APPRECIATE YOUR TIME. THANK YOU FOR SPENDING A GOOD CHUNK OF YOUR LUNCH HOUR WITH US TODAY.

About CNBC:

With CNBC in the U.S., CNBCin Asia Pacific, CNBC in Europe, Middle East and Africa, and CNBC World, CNBCis the recognized world leader in business news and provides real-timefinancial market coverage and business information to approximately 381 millionhomes worldwide, including more than 94 million households in the United Statesand Canada. CNBC also provides daily business updates to 400 million householdsacross China. The network's 15 live hours a day of business programming inNorth America (weekdays from 4:00 a.m. - 7:00 p.m. ET) is produced at CNBC'sglobal headquarters in Englewood Cliffs, N.J., and includes reports from CNBCNews bureaus worldwide. CNBC at night features a mix of new realityprogramming, CNBC's highly successful series produced exclusively for CNBC anda number of distinctive in-house documentaries.

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