The word itself isn’t wrong per se, but it has a negative connotation that’s associated with “slow” people (from the medical terminology “mental retardation”). It’s a playground insult to call someone “retarded” because they’re “stupid”. It could just be an American thing, but using it like that is very common.

I think a good comparison is “fag”. Sure, it means a cigarette, but it is (was?) a common insult towards gay people.

Should we not use the word? I don’t know. I’m just explaining why dpeck wrote their comment.