Having turned decidedly bullish in the immediate aftermath of the Trump victory, his supporter Carl Icahn said the strong rally in U.S. stocks since last Wednesday’s “shocking” event might be overdone, however he added that investors can expect the president-elect to be a consensus builder who can help fix Washington and improve the economy. “When it runs up like this, I scale off a little bit,” Icahn said on Wednesday at the Reuters Global Investment Outlook Summit, but added “that doesn’t mean that I am that negative or positive.”
Icahn, who has praised Trump’s two potential Treasury picks in either Jamie Dimon or Steven Munichin, aka JPM or Goldman, said on Wednesday he is confident that Trump can help undo the “stagnation” in the United States and its economy, which dominance of the Washington “establishment” has fostered. “We have a perception that the government is at war with business,” Icahn said. “The point I think about Donald is he’s a consensus builder, he’s a very smart guy.“
As reported previously, Icahn confirmed that he left what became Trump’s victory party in the early morning on Nov. 9 to bet about $1 billion on U.S. equities. He called the knee-jerk overnight plunge in stocks, as it became clearer to investors that Trump might win, “crazy” and “unique,” and that it created a buying opportunity.
Icahn added that he expects Trump to fulfill his promise to reduce regulatory burdens on business, including Dodd-Frank financial reforms that “went too far.” Hope on Wall Street that Icahn will undo years of reform has sent financial stocks soaring in the past week, leading to the biggest inflow in financial ETFs on record. As Bloomberg reported, in the week following the election, the Financial Select Sector SPDR exchange-traded fund amassed $4.9 billion of inflows — a record, and more than it accumulated in the past three years.
