Week of February 8: Carl Icahn's Thoughts on U.S. Business

Carl Icahn is one of the most well known activist investors. His wealth has allowed him to purchase many shares of companies and earn seats on each company's board. In a 2008 commencement speech at Drexel University, Icahn commented on how terrible management is for U.S. companies. Icahn believes nobody is willing to take a stand for what they believe in, starting from the CEO, within the Board, and throughout management. Icahn said that most companies are hiring people unqualified for their job. The CEO's are essentially putting people 'dumber' than they are in positions below them so they will not "rock the boat." Icahn believes that this process will eventually lead to U.S. companies being run by morons. I agree with Icahn, although I have never witnessed this, it seems logical for a CEO to act in this manner. After all, why would CEO's want to put anymore added pressure on themselves by having intelligent board members? Icahn's view may come across as extreme, but I believe it is understandable and believable. This situation puts employees who hope to be promoted in an interesting position, should they "rock the boat" and show their intelligence, or do they sit back and act stupid? To read more on what Icahn said in his commencement speech visit gurufocus.com.