In an interview with CNBC’s Squawk Field, Sternlicht was requested what he’d say in response to JPMorgan Chase CEO Jamie Dimon’s annual letter to shareholders, through which Dimon writes that present financial situations “create extra threat and doubtlessly larger inflation,” and better price hikes. Nevertheless, after saying he’s an enormous fan of Dimon and that he runs “in all probability among the finest banks on the earth,” Sternlicht clarified to CNBC that “we don’t agree on every little thing.”  

Sternlicht, who runs a personal fairness agency identified for its billions in actual property holdings, instructed CNBC that he thinks “inflation goes to drop laborious.”

Sternlicht pointed to falling rents as the rationale, alluding to a slide that confirmed year-over-year lease progress, with two strains: one indicating “precise rents” and the opposite per the patron value index. Viewers can see “precise rents,” or lease checklist costs, shifting downward, whereas the opposite as measured by the CPI seems to be trending upward. “There’s a lag in the best way the federal government experiences rental information,” Sternlicht mentioned, however when you right for this, it’ll present up later. 

And it’s not the primary time he’s mentioned as a lot about inflation or outdated information. Towards the top of final yr, Sternlicht mentioned “the economic system is slowing by itself,” after calling the Federal Reserve’s price hikes “self-inflicted suicide.” In fact even earlier than that, he’d been a vocal critic of the Fed, telling Fortune that Fed Chair Jerome Powell and “his merry band of lunatics” have been destroying religion in capitalism and would finally set off “social unrest.” He additionally berated the establishment’s use of “outdated information,” that’s behind its aggressive price hikes. Nonetheless, he’s beforehand claimed “inflation is coming down laborious… and it’s coming down lots sooner than I feel folks thought,” and as soon as once more is sounding the alarm. 

Shelter is one-third of CPI, Sternlicht mentioned this week, so when you make that correction it’ll deliver headline inflation down and also you’ll seemingly see that occur within the late summer season and early fall. He continued, “so all else being equal, inflation goes down.” 

After peaking in June at 9.1%, inflation as measured by the patron value index, has slowed to six%, as of February. The index for shelter (which measures modifications in shelter prices) was the most important contributor to the month-to-month all objects improve, accounting for over 70% of the rise. Nevertheless, lease progress continued to sluggish in February, marking the sixth consecutive month of single-digit will increase on a nationwide degree, in line with Lease.com. The median month-to-month lease rose 1.7% month-over-month however fell 0.25% year-over-year, in line with the location’s report. On the state degree, median rents have been down in 60% of markets included within the research month-over-month and barely over 16% of markets year-over-year.

His lease information, Sternlicht mentioned, comes from a nationwide lease database, earlier than including that his firm has 125,000 flats they usually can mannequin it, but it surely’s not even throughout the nation. When rents have been up 20%, Sternlicht mentioned, “that’s what actually drove CPI.” Sternlicht went on to mock the Fed’s credibility, which as we all know, isn’t an uncommon take for him. 

Though Sternlicht didn’t touch upon what falling inflation means for the actual property market, business or residential, it’s clear that each sectors throughout the trade are extraordinarily delicate to price hikes, and when rates of interest go up, property values can go down. However despite the fact that Sternlicht argues inflation is falling, he thinks “we’re going right into a critical recession.”