Real estate billionaire Barry Sternlicht says there is a recession heading our way for that sector and it will be unavoidable. The economy is in big trouble because of the central bank’s disastrous and aggressive monetary tightening.

The Starwood Capital CEO warned about the Federal Reserve’s actions in an interview with Bloomberg Wealth this week, according to a report by Business Insider. Central bankers have raised interest rates 525 basis points to tame inflation, and the fallout from that aggressive pace of tightening is about to hit the economy, he warned.

“I like to say there’s a hurricane over real estate right now. We’re in a Category 5 hurricane, and it’s sort of a blackout hovering over the entire industry until we get some relief or some understanding of what the Fed’s going to do over the longer term,” Sternlicht said in an interview with David Rubenstein.

“There is going to be a serious credit contraction. The country in any asset class has not adjusted to that cost of capital yet. But it’s coming. The economy will slow,” Sternlicht said.

Economic Forecasts Predict Recession Won’t Hit Until 2024

“It feels like the last gasp before we settle into what should be, what you’d expect to be – I hope it’s a shallow – recession,” he added.

Other Wall Street commentators have been more upbeat recently. Markets are widely expecting Wednesday’s rate hike to be the Fed’s last of the year, boosting odds that tight financial conditions won’t push the economy into recession. While labor markets are hot still, inflation is steadily cooling, leading to talk of a Goldilocks scenario in which the Fed can lower inflation without crushing demand or crimping growth. –Business Insider

Other economists claim a recession possibility is a “coin toss.” They don’t know if there will be a recession, but they can’t rule it out.

To Many Americans, It Already Feels Like We Are In A Deep Recession