- Robert Herjavec fears the Fed's rapid interest-rate hikes will bring the US economy to a standstill.
- The "Shark Tank" investor said the central bank is being far too aggressive in its inflation fight.
The Federal Reserve is hiking interest rates too quickly in its rush to crush inflation, putting the US economy in serious jeopardy, Robert Herjavec warned.
The "Shark Tank" investor is more worried "about the Fed and this maniacal drive with interest rates" than he is about rising prices, he told Fox Business on Monday.
Inflation has surged this year, hitting a 40-year high of 9.1% in June, and remaining above 8% in August. In response, the Fed has raised rates from virtually zero in March to a range of 3%-3.25% today.
Herjavec questioned why the US central bank approved three mega-hikes of 75 basis points each in recent months, when there were signs inflation was starting to cool on its own.
The CEO of Cyderes, one of the world's largest cybersecurity companies, cautioned that the Fed's rapid tightening of its monetary policy is threatening to choke the robust US economy.
"Consumers continue to spend, capital goods are going up, my customers — enterprises — are still spending," Herjavec said. "But inevitably interest rates have to catch up to it."
"I worry we're going to hit a wall, and the interest rates are going to catch up to us, and the whole thing is just going to stop," he added.
Herjavec is the latest in a long line of market commentators to suggest the Fed is going too far in fighting inflation. Elite investors such as Ray Dalio and Bill Gross, and leading academics including Jeremy Siegel and Paul Krugman, have argued the central bank risks doing more harm than good by hiking rates much higher.
On the other hand, former Treasury chief Larry Summers has called on Fed officials to keep raising rates, as he fears stubborn inflation will have a devastating impact on the US economy.
Notably, Herjavec predicted in May that that market downturn would continue, with anxious investors sending stocks down another 20% to 30%. The S&P 500 and Nasdaq have both slumped by about 9% since then, extending their year-to-date declines to 25% and 33% respectively.