This is a rush transcript from "Your World With Neil Cavuto," November 21, 2008. This copy may not be in its final form and may be updated.

NEIL CAVUTO, HOST: Well, you might not know the name Timothy Geithner, but the markets sure do. The New York Federal Reserve President isn't quite a rock star, but for financial guys who value smart, solid, and savvy leadership, he is very darn close. A fellow who has been working with Fed head Ben Bernanke and Treasury Secretary Hank Paulson on this ongoing financial bailout and also worked with Bill Clinton's money men Bob Rubin and Larry Summers.

"A bipartisan buy," as one Wall Streeter just told me a few minutes ago. And buy they did. Take a look at this, a 500-point surge in the Dow. Back over 8,000. It is not exclusively the Geithner appointment, but it certainly did not hurt matters any. Reaction now from billionaire investor Carl Icahn. He joins me by phone.

Carl, what do you make of this choice?

CARL ICAHN, LEGENDARY INVESTOR: Yes. How are you doing? Look, I think any of these candidates were very bright guys. But I think the important thing, Neil, is that you have to instill confidence, you have to get moving, Obama has to get out there, show he is doing something, and show what will happen.

Video: Watch Neil's interview with Carl Icahn

And you know, these banks are full of toxic securities right now, and you have to show your plan to clean this up. And I think that's the reaction here. I think he's — you know, Tim Geithner is a real bright guy. And I'm behind any of these top candidates.

CAVUTO: Now, with Bill Richardson going over to Commerce, the guy who pushed forward, in the early days at least in the Clinton administration, some of these big trade deals that ironically as a candidate Hillary Clinton later opposed, I'm getting a sense from this cabinet with Geithner heading Treasury that he's trying to select a money dream team. Is it that? Will it be that? What will it take for Carl Icahn to believe these guys are serious about addressing these problems?

ICAHN: What you have to do in one iteration or another, in my opinion, and I mean, I'm not the only one thinking this, that you have to go in and show that can you do something with housing. I mean, that's the real beginning of this. And I mean a concept, a simple concept obviously is you go in and in one form or another, you go with these CMOs, you know, these mortgage trusts.

You go and you buy the mortgages in trouble. So you go in and the government, in one way or another, guarantees these mortgages, guarantees such an institution like Fannie Mae. And I know nobody likes Fannie Mae right now, but that concept where you go in and you say, I'm taking these mortgages out of the CMO, here's what I'm going for.

CAVUTO: So you're talking about going — you're going beyond. And since Geithner was actively involved in this rescue, going beyond what were the original sort of blueprints for this thing into.

(CROSSTALK)

ICAHN: I don't even know — I'm not even sure what the blueprints are. Look, I'm not a — I don't believe in big government and never did, but right now you need them. Right now these guys on Wall Street got themselves in this mess with these derivatives. And you have got to get them out of it. I mean, there is no choice.

It's like, you know, your kid drove again, you know, your kid drove the car and drove again, you don't kill the kid, you just have to discipline him. What I'm bothered by is we're doing these things and we're keeping the same guys in office of these companies. Now some of them are good, but you don't have — I mean, I keep going over my whole story, you don't have corporate governance. So you are still going to have the same kid driving the same car unless you do something about it. You shouldn't.

(CROSSTALK)

CAVUTO: So if you would like — if you had your druthers and could offer Geithner any advice in rescues of the future, if there are to be any, sadly but likely will be, maybe the first thing required would be the resignations of those seeking them?

ICAHN: I wouldn't say that. You know, I have said this before. And I give my little pitch that I have been saying it for years. You don't have boards in this country that are doing their job. You see today in The Wall Street Journal, they are all quitting, and some of them are quitting.

What you have to do is have true elections. And you know, I have this blog, Icahn Report. And I have set up United Shareholders of America. And I want — you know, I'm hoping people will join that so finally we can get laws changed in Washington, certain laws, and simple what you could do. We have true elections, true accountability. You wouldn't have this mess.

So what you have to do is join something like this United Shareholders so I go to my Icahn Report. My point is, Neil, that you have to move in that direction. But what you do today — you know, obviously, you're asking what you do today.

And as soon as possible, you're at the worst period in this lame duck session, so it's almost a perfect storm against you. But hopefully Obama, by moving this quickly, is now going to come in and say hey, look, this is my plan, this is how we're going to get these toxic securities out of the banking system, and we're going to bring home prices back up by taking away the foreclosed mortgages, buying them, in one way or another, the government doesn't even have to lose money.

CAVUTO: Making it work.

ICAHN: But buying them and then modifying them so the middle class guy in the country, the lower middle class guy can go in and keep his home. And that's what we have to do.

CAVUTO: All right. Carl Icahn, my friend, busy show here. Thank you very much. Good talking to you.

ICAHN: Sure thing. OK.

CAVUTO: Carl Icahn.

ICAHN: Good talking to you, Neil.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

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