Carl Icahn, a Wall Street expert, warned that “the worst is yet to come.”

Carl Icahn speaks at the World Business Forum in New York, 2014. Photo: AP/Mark Lennihan, File

  • He thinks stagnation is key to the current bad moment: ‘It can’t be cured’

  • According to him, the Fed should be bolder to try to stop it

  • Sees market opportunities: ‘A lot of things are cheap’

Carl Icahn, a Wall Street legend who has a net worth of about $18 billion, was extremely pessimistic about the future development of the US economy this week, during the Financial Innovation Festival. The best new ideas in moneyFrom MarketWatch.

While his company Icahn Enterprises is on the strength of 2022 amid much uncertainty — its net asset value is up 30% in the first half — he ranks 84th on the list of the world’s richest man, according to Forbes’ real-time ranking, warning investors that “the worst He hasn’t come yet.”

As expected, see MarketWatch, Icahn argued that inflation plays a critical role in the market’s downturn. “It can’t be cured,” the 86-year-old teacher said, referring to the fall of the Roman Empire.

‘Party is over’: Icahn wants the Fed to be more aggressive

It is clear to Icahn that part of the blame lies with federal expenditures for the current fiscal problems in the United States. We printed a lot of money and thought the party would never end. The party is over.”

Although he supported the Fed’s anti-inflation move to raise interest rates by 75 basis points, Icahn also believed that the Fed could have been more aggressive and would have personally supported even a 100 basis point rate hike.

Since March, Icahn has been skeptical of the Fed, saying in an interview with CNBC that he wasn’t sure the agency could manage a “soft landing” to tackle high inflation. He also said that, to hedge against a possible recession, he bet on malls and commercial real estate.

Bright side: There are still shares to buy

In his distant speech on Wednesday, the billionaire and former adviser to Donald Trump based his defeatist view on the current state of the stock market, which has experienced the worst first half of the year since the 1970s.

However, Icahn, who has been in finance since 1961, spoke of areas of opportunity for investors and noted that hedging strategies were key to his success. A hedging strategy reduces a portfolio’s exposure to market volatility by taking positions that have the net effect of reducing risk.

The Princeton Philosophy graduate stressed that investors can still find stocks to buy. “I think a lot of things are cheap and they will be cheaper,” he said, referring to companies involved in oil refining and fertilizers.

Among the trustworthy companies he recommends keeping a close eye on is Texas-based CVR Energy. On Wednesday, CVR shares were trading at $28.89.

The Nasdaq said Wednesday that investors should take into account any recent changes in analyst estimates for CVR Energy, as they help show the changing nature of short-term business trends.

Carl Icahn during an investor event organized by CNBC.  (Photo: Heidi Gutman/CNBC/NBCU Photo Bank via Getty Images)

Carl Icahn during an investor event organized by CNBC. (Photo: Heidi Gutman/CNBC/NBCU Photo Bank via Getty Images)

Businesses need better management

As an active shareholder — using a stake in the company’s equity to pressure its management — Icahn emphasized the idea that today’s business should be better managed. “You don’t have to hold the administration accountable,” he said.

As for the recently passed inflation-reducing law and its goal of reducing carbon emissions, he said he understood the need to limit carbon, but believed the legislation had gone “too far”.

For the employer, the procedure can be compared to the condition of a sick patient for whom a lot of drugs are prescribed. “If you take 100 pills at a time, you die,” he said.

Carl Icahn made headlines in April, when Forbes Spain likened him to a “predator that chases its prey when it’s not ready,” notorious for profiting from businesses, by “blasting it from within.”

“If Warren Buffett is a clear value investor, who consistently outperforms the S&P 500 most years with a clear philosophy, Icahn benefits from focusing on a strategy based on some kind of war of attrition,” the magazine says.

His name also appeared at the beginning of the year, when it became known that he was leading a battle for two positions in the direction of McDonald’s. The fast-food chain confirmed that Icahn nominated two people after criticizing the company for its use of carrying boxes for pigs in its supply chain.

McDonald’s initially pledged to end the practice by 2022, but has extended the commitment until the end of 2024.

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