“It’s Like, ‘F*ck You, America’”: Aided by the Fed’s Cheap Money
Carl Icahn is not one of those warm and fuzzy billionaires. He’s gruff, iconoclastic, does his own thing, and doesn’t really give a shit what you or anyone else thinks about him. He’s been plying his activist investor shtick around Wall Street for more than 50 years and made himself a fortune. For a while, he ran a hedge fund where he managed his and other people’s money. But he shuttered it and now just invests his own money, his own way. His net worth, according to Bloomberg, is $18 billion.
Like Donald Trump, Icahn is from Queens, although he’s from the Jewish side of the tracks. Still, he’s been friends with Trump for decades, ever since he cut a deal—when The Donald’s Atlantic City casinos were going bankrupt in 1990s—that allowed Trump to continue to have a role in their operation and to keep getting paid, when by all rights Trump should have been fired. Icahn bought Trump Entertainment Resorts out of bankruptcy in 2016. When Trump became president, he rewarded Icahn’s loyalty to him by making Icahn an adviser to him on regulatory reform, essentially putting the fox in the henhouse. Icahn quit that role in August 2017 days before a New Yorker article documented his various potential conflicts of interest and how he was allegedly using his assignment with Trump to feather his own nest.
vanityfair.com
Carl Icahn’s Failed Raid on Washington
The old conundrum about whether it is better to be loved or feared has never posed much of a dilemma for Icahn. In “King Icahn,” a 1993 biography, the author, Mark Stevens, described his subject as a “germophobic, detached, relatively loveless man,” and quoted one contemporary saying, “Carl’s dream in life is to have the only fire truck in town. Then when your house is in flames, he can hold you up for every penny you have.”
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Corporations, seeing Icahn coming, often tried to fight him off. His reputation grew so fearsome that some companies paid him to go away by buying his shares back at a premium—a practice known as “paying greenmail.” Marty Lipton, a corporate lawyer whose firm has often been hired by companies that were looking to thwart an Icahn takeover, wrote a memo four years ago in which he described raiders like Icahn as engaging in “a form of extortion.” In Lipton’s view, such investors “create short-term increases in the market price of their stock at the expense of long-term value.” In the nineties, when Icahn was fighting for control of Marvel Comics, the company’s C.E.O., a veteran of the Israeli Army, likened dealing with him to negotiating with terrorists.
newyorker.com |
