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Federal Reserve chairman Jerome Powell has anguished over the rise of inflation for more than two years now. And despite having some success in taming consumer price increases that reached a four-decade high above 9% in June 2022, the Fed chair reiterated in congressional testimony<\/a> this week that continued progress \u201cis not assured.\u201d <\/p>\n But don\u2019t worry: Barry Sternlicht, the outspoken billionaire co-founder and CEO of real-estate giant Starwood Capital, has a solution to Powell\u2019s biggest problem.<\/p>\n \u201cWhat he really needs to do is walk across the street and tell Congress to stop spending money like drunken sailors,\u201d Sternlicht said in a new interview<\/a> on the globally-syndicated TV show In Depth With Graham Bensinger<\/em>.<\/p>\n While the Fed has been attempting to clamp down on inflation with interest rate hikes, Sternlicht\u2014in his typical, somewhat acerbic style\u2014noted Congress and the Biden Administration have made that task a challenge by dramatically increasing federal spending and the national deficit, at least compared<\/a> to the pre-COVID era.\u00a0<\/p>\n \u201cYou have one part of the government with a foot on the brake\u2014The Federal Reserve and Powell\u2014and then you have the other part of the government\u2014the legislature\u2014spending as much money as they can,\u201d he said.<\/p>\n Sternlicht, who started his career as a Wall Street trader and now boasts<\/a> a net worth of $3.8 billion, has long argued the Fed\u2019s main method for dealing with inflation\u2014raising interest rates\u2014just doesn\u2019t work.\u00a0<\/p>\n Last March, the billionaire CEO said<\/a> central banks\u2019 interest rate hikes were like \u201cusing a steamroller to get the price of milk down two cents\u201d or to \u201ckill a small fly.\u201d Just a few months after that, Sternlicht warned the real estate industry, particularly office real estate, was in the middle of a \u201cCategory 5 hurricane<\/a>\u201d due to the Fed\u2019s policy. And in October 2022, he even told Fortune<\/em><\/a> that Jerome Powell and his \u201cmerry band of lunatics\u201d were destroying the economy and risking \u201csocial unrest.\u201d<\/p>\n Now, though, with the economy proving its resilience<\/a> to higher rates, Sternlicht seems to have shifted his view. Instead of destroying the economy, the Fed\u2019s rate hikes haven\u2019t done enough, he says.<\/p>\n \u201cHigher interest rates are not slowing the economy. People think they are, but they\u2019re not,\u201d Sternlicht told Bensinger. \u201cBecause if you look at the jobs market, it\u2019s health care, government, and education are adding tons of jobs, and they don\u2019t get impacted by interest rates.\u201d<\/p>\n Sternlicht argued interest hikes are an \u201carcane\u201d and inappropriate method to fight inflation. But instead of warning the U.S. economy is being destroyed by these rate hikes\u2014he\u2019s previously argued its \u201cbraking hard<\/a>,\u201d called rate hikes \u201csuicide<\/a>,\u201d and the list<\/a> goes on\u2014Sternlicht now seems to believe Powell\u2019s tools are just devastating key segments of the economy, including the one he operates in.<\/p>\n When it comes to real estate, Sternlicht argued we\u2019re going through a once-in-a-lifetime crisis. \u201cI\u2019ve been through five or six crises. This one feels the worst,\u201d he said, adding that \u201cusually we screw up the global economy, the real estate industry \u2026 This time we didn\u2019t. We were just collateral damage.\u201d<\/p>\n<\/div>\n\nSubscribe to the CFO Daily newsletter to keep up with the trends, issues, and executives shaping corporate finance. Sign up<\/a> for free.<\/div>\n