His first interview in ten months since president trumps inauguration since then stocks have roared to alltime record highs, including todays 24,000 milestone mr. Mr. Icahn writing a letter criticizing the planned deal with Bonanza Creek and its adoption of a poison pill, which he calls a travesty. Carl, welcome back its good to talk to you again. Good to talk to you. Well get to this incredible stock market in a moment, but lets begin with sand ridge. Thats your news of the day and this letter that youve written to not only criticize this planned acquisition but a poison pill that you refer to as a complete travesty and representing a new low in Corporate Governance why so yeah, i think that the company, i believe, to entrench itself went out and issued stock and issued stock for a Company Called bonanza and theyre paying bonanza a 75 premium to the 421 million valuation established by bonanza creditors. This was written in an article, who i dont know and never met and own a fair part of this company. But heres the really important thing. The thing thats so reprehensible. Its not so much that they went out and overpaid for this or want to overpay, and its not even that this guy, bennett, who runs the company now get this, bennett started the company. He was in the company of sandridge in 2011 as cfo then in 2013 they pushed the ceo out, it was a proxy fight for a lot of things that i dont want to go into or cant go into and they put bennett in who was then the cfo. Bennett presided over the destruction and the loss of 5 billion. So think about this. The Company Shares the shareholders got nothing, zero and during this period, bennett has taken 50 million for himself. And also presided in giving what you assume was his buddy, the ceo that left because they pushed him out, 90 million. So this is a blatant it makes a Banana Republic look good. Its like what ive been railing about in Corporate Governance. And you know i think that this might be a really very important point because were going to be going to delaware to fight this type of pill, because they put in a pill that, you know, to stop guys like me, you know. I bought a fair amount of stock i bought the stock a little bit i had a little bit of stock in it, you know, when it was up around 19 or 20. And i had a little bit and i thought, okay, what the heck, i know the company, i know that area pretty well, we had done business there a long time ago and incidentally sold one company to them and i had no intention of really going after it but they went out with this crazy deal and the shareholders really dumped stock on the market, a tremendous amount of stock on the market so about 20 lower i was able to buy up to 14 . They come out with a pill, but the pill is the most outrageous thing ive ever seen so im not even arguing about bennett taking all this money out for himself and i believe screwing the shareholders, im not arguing so much about overpaying for this, but heres the unbelievable thing theyre saying that you as shareholder do not have the right to talk against the deal in other words, i cant go out, and even in a totalitarian state you have a right to go against the dictator of course you might get shot but you might not. You might get shot, you might not. In this case you definitely will lose all your money if you have if you utter one word against the company. If you go to other shareholders and say, hey, vote against it. So theyre going to have a meeting. Theyre going to have a meeting and theyre saying, but if any of you you can vote against it, but if any of you dare to say were wrong, were going to tell everybody were right but if you dare to say were wrong, icahn, or anybody with more than 10 of the stock well, not more if somebody had 4 of the stock, another guy has 3 , another guy has 3 , according to this pill it seems like you lose all your money. Because they add it all together for what the 10 of what the pill is. And they made it so ambiguous that you dont know. So they hire lawyers, they pay them a fortune to come up with this stuff because they really want in my opinion, they want to entrench themselves. They got the honey pot and i think bennett has just tried to do it again he got 50 million out, 90 million out for his buddy and why not try to do it again, go to the long ball. There are a couple of important things that i heard you say and i was going to ask you anyway it sounds to me like are you going to sue in Delaware Court yeah, i think weve already you read the letter we wrote to the company. Weve asked them weve asked the company to clarify that what i said isnt true because its ambiguous and say, hey, we want to know that weve got the right to go, and we will very strongly electioneer against this deal. We want to know that we have the right to have a special meeting. The Company Gives you the right to have a special meeting, so we can call a special meeting, thats fine, but you cant talk to anybody after the special meeting about what you want to do which is get rid of the board. You cant do that, according to this pill. You know, theyre going to have a meeting now theyre going to have a meeting you have to get the vote of the shareholders to approve of giving half your company away in this deal its tantamount to giving half the company away and paying 75 higher than what the company was valued at only six months ago its the most ludicrous thing ive ever seen. How optimistic are you that you can stop them from doing this deal . Well, im going to tell you, ive been pretty good at this for the past hopefully this is what i do, and i will tell you that im going to give it my best college try its not that im walking away and not doing it now, i will tell you its a little binary for the company in my opinion because if they get this deal through, this company is worth, in my mind and what the market said, they just diluted the company of about 40 of its worth now, theyll come up with a lot of arguments, they havent but theres no question that theyre doing this for other reasons in my opinion, to entrench themselves and for bennett to get himself another 50 million, 100 million. I hate to use the word steal but thats as close as i can think about it this is whats happening an were not going to let it happen. Youre not the only large holder that appears to be against the deal you mentioned fir tree partners. We reached out to sandridge today to let them know that you were coming on to see if they have any comment they have no comment but youre clearly not the only voice here of a large holder perspective thats against this deal. Yeah, im really happy about that i will tell you categorically not because i planned it that way but i dont know any of these people ive never spoke to any of those. So i will tell you that its not something that was planned or anything like that not that its terrible to plan it i mean i think you have a right to go to shareholders. In an election, youre running for congress, somebody else is running for congress, theyre telling you that you dont have a right to go to anybody and ask them to vote for you i mean this is as bad as it gets. Is it this particular deal that youre so vociferously against . Would you prefer that the company does a different deal, or this deal at a different price . No, i dont want i think i dont want to see the stock diluted, which will help them be entrenched i think theyre a terrible board. They got, i think, after bennett presided over bankruptcy, he destroyed all the value, got 50 million and now hes trying to do it again, hes still there. And so i just think the board is really bad and what have you but i think its deeper than that normally this would be a little small for me, so it wasnt something that, look, i want to go get sandridge even though i think its badly run there are other companies god knows that are badly run but i think the concept of this is so outrageous and reprehensible that its sort of got to be stopped. If its not stopped, i really think today in the euphoria we have, i dont think anybody is too concerned, Corporate Governance, so what, look how great it is. But its not going to remain great forever. And one of the great things about our country as ive said for years is democracy one of the great things about our corporations is that you can go and change the companies if theyre badly run. You just used the word euphoria and id like to switch our attention to the stock market right now the Dow Jones Industrial average today is up 232 points as we speak crossing 24,000 for the First Time Ever we havent spoken since the inauguration when you were wildly positive about what could take place in this country from a business standpoint because of president trump. Im wondering what you think today as we mark yet another milestone for stocks look, i must admit i really thought trump was going to really change the landscape, and he certainly has gone far to do that im not that involved with washington, as you know, but i am i have to say surprised at the euphoria i think i personally think, thats just me talking you know, this is like going to vegas and asking is the roulette wheel going to come up black or red . In other words, i think its very difficult to now predict whats going to happen in the next week or the next month. But i will tell you that i really think even though earnings are going to be very good and what have you, i just think this thing has got into a euphoric state to quote what was said many, many years ago, i think theres a bit of irrational exuberance right now. But being that said, i do think that with the tax break and with the way you have the emerging markets being so strong, i have to admit that there might be a very strong underpining to this market so in other words i just think its runaway and might have a big correction but i cant say its insane, so maybe i shouldnt say rational exuberance, maybe i should say a little too much exuberance at this time. Look, the market went up some four more years, i believe, after Allen Greenspan said those words so you can still be rationally exuberant and still have a long runway before us is that the environment that you think given taxes, whats going on with the Global Economic recovery and so many other things that seem to be a tailwind for stocks . Yeah, yeah, i want to change the word rational exuberance theres a lot of underpining, a lot of strength. I am just surprised that it happened with such a great force and momentum and yet so i do think you know, when that kind of thing happens, there are corrections so you have to be very cautious. So obviously im not saying anything that these people dont quite understand themselves. Sure. I noted themselves with sandridge that its your first new activist position of the year, which began in october, which is news in and of itself youre normally a pretty active person in the market is that representative of how you view in some respects where stocks are, that good values, undervalued stocks like you like to say are harder to find in this environment and thats why this is your first so late in this yoear . Yes, youre definitely correct. Its hard to find you know, when you do this activism, youve sort of got to feel its a nobrainer youve got to feel that youve got a lot of value in it, you know, so that if youre right, you put in a lot of effort into it and so youve got to say look, like in ebay, we said look at the jewel paypal, all youve got to do is get them separated. So youve got to have something that will dramatically increase value when you do it and so there are very few things that i find where that exists today where you can dramatically increase value without worrying that youre going to get a correction thats going to hurt you badly. So its not an easy its certainly not an easy market i dont think anyone, anyone is going to tell you, oh, you know, this is a nobrainer these companies theyre just great and nothing can happen to them you know, looking back, and ive been in it a long time, you know, Something Like north korea will happen and the market will be getting really badly damaged while everybody is a little scared of whats going to happen today all this stuff is just brushed off. So its surprising to me that its had this especially in the light i used korea as one example but a few other things so in light of that, im surprised at the exuberance. But i want to correct what i said, i dont think its completely irrational because i think theres an underpining to many of these companies. Lastly, before i let you go, what do you make of bitcoin . Are you an investor, in any way in it . What do you think about it ive got to tell you honestly i dont understand it. Im the last guy to i just dont get it i just stay out of something that i dont understand. I leave that to others to explain and talk about. Are you marvelled by what you see there . Yeah, its like sort of amazing to me. Its one of these things, if you read history books about all these bubbles, you know. Like the mississippi bubble and all, where they went around and selling all this land in mississippi that was sort of worthless and the french were going crazy giving him all this money and then one night it all blew up and they were after this was the time louis xiv who didnt like them anyway. I mean theres books on these bubbles. To me, this is what this is. But im the last guy to say that because i really dont i could talk about bubbles in certain areas that i think exist sometimes, like in real estate when you have these apartments in new york going for 200 million and you have artworks going for 400 million, i say, hey, those are bubbles caused by low Interest Rates but i cant talk about bitcoin i dont understand how the hell it gets up there. It is quite remarkable. It certainly has a lot of people following it carl, we appreciate your time. Its good to talk to you again its been a while. Good talking to you again, scott. Thanks for calling. You bet, take care. Carl icahn joining us there on the phone. Lets wrap this up quickly on the desk as we said, the gang is here today. What do you think . Its not he corrected himself, didnt want to go as far as to say its irrational exuberance, but is it euphoria what is it well, i think on days like today, youre hitting euphoria over the passage of the tax bill and thats still not a slam dunk, although mccain coming out makes it seem more passable. Youve got more Global Growth numbers that came out from europe u. S. Numbers are good. So there are underpinnings in the market what is disappointing that some of the stocks that sold off hard yesterday like micron havent recovered as much. Im glad you went there, pete, because its been a bit of a whimper in terms of a rebound. Yes, the nasdaq is positive, yes, tech is positive, but this is not much of a bounce. But when you think about where they have come from, micron, steve and i were talking off air, micron up 100 on the year so a pullback, this is a significant pullback its a reasonable pullback but you look at most of the Tech Companies in the semi space and stocks up 50 , 60 , 70 . The fact that theyre adjusting back, weve seen it in the banks, in the industrials and seen these pauses here and there. Look at the financials today, absolute explosion you have Goldman Sachs and jpmorgan in the dow, but bank of america and citi and wells fa o fargo. The financials are ramping up. 2017 has been the year of rotation. Thats the positive, that you have a rotation. Absolutely. Its not one area. Or f. A. N. G. You see it moving today. If today is the definitive answer to the question that you posed earlier today, who knows im wondering what you think about the rotation, kevin, that weve seen in stocks, whether its this lasting new way that people are going to be viewing this market, maybe selling some of these tremendous tech winners and getting into other areas of the market that they deem better values at this time . I think rotation is very healthy and to have it happen now are helping guys like me trying to make bets for 2018 trying to decide where the value exists i want to go back to the icahn thing for a second you think about activists. What a bad rap some of them have got. But heres a guy, i see him dressed up as robin hood, stepping out of the forest saying look at this Little Company screwing over their shareholders but im not just going to talk about it, im going to take my own personal money and put them over the coals in court. I love this stuff. I think this is what its all about. And i think we want more carl icahns doing exactly that. I dont know this company, i dont know the ceo, but what i just heard was absolute bs and i think he should be put out there on a spit and turned over the coals for it diluting his company by 0 , buying an asset 75 over its market value and then he meets robin hood i love it. Josh, one of the most interesting things that we glean from this new position by carl icahn as of october in sandridge is as i said its his first new activist position of the year. Thats how difficult it is to find value in this market now, and its only going to grow more difficult. Yeah, so i think its interesting. There is value in certain areas of the market, and energy is obviously one of the targetrich areas for Value Investors right now. And then maybe in some retail, a handful of Drug Companies that have been killed this year but overall this is one of the easiest years to have been an investor maybe in the 19 years that im doing this, even right now you think about were talking about there being a tech correction. Meanwhile, the qs are 7 above their tenmonth moving average, midcaps, 6. 7 above. None of these are anywhere near what you would term a traditional term reversal. International has outpaced u. S. So its been very hard to find fallen angels, Companies Like sandridge that havent lived up to their potential theyre out there, some of the restaurant stocks maybe. Overall all you had to do this year was wake up, get out of bed, you made a lot of money. Transports up 5 , airlines up 4 this is on the week Home Builders up 3, retailers up 6, banks up 5, industrials up 3, tech, nasdaq, f. A. N. G. , semis, emerging markets down. Financials are the area that are most important to me coming off this week. Weve talked a lot about that being the positive but we keep measuring sentiment and are talking about irrational exuberance i think the word that comes to mind before this is all over is youre going to begin to see more and more parabolic moves and i think we got a little glimpse