Inflation holds strong as American voters’ top issue, according to "Shark Tank" star Kevin O’Leary, who warned on FOX Business Monday that it’s creating a "downsized" nation.
"We're looking at a downsized America. I tell it like it is," O’Leary said on "The Big Money Show." "Three years ago, even 24 months ago, you get a mortgage at 4.5%. You're lucky to get one at eight today. So that means the size of the house you're going to buy is 20 to 25% smaller. That's a downsize."
"You want to borrow for a car? Sorry, that's 8 to 9%. Used to be five," the O’Leary Ventures chairman added. "So, smaller, less expensive car. That's happening at the same time."
The business leader’s comments come less than one week after the Federal Reserve announced it would hold interest rates the same as central bankers confront a surprisingly resilient economy and still too-high inflation.
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The widely expected decision left interest rates unchanged at a range of 5.25% to 5.5%, the highest level in 22 years. But policymakers also left the door open to an additional increase before the end of the year amid concerns that inflation "remains elevated."
"Inflation has been coming down, but it's still running well above our 2% target. The labor market has been re-balancing, but it's still very tight by many measures. GDP growth has been strong, although many forecasters are forecasting that it will slow," Fed Chairman Jerome Powell told reporters at a post-meeting press conference in Washington, D.C. "As for the committee, we are committed to achieving a stance of monetary policy that is sufficiently restrictive to bring inflation down to 2% over time. We are not confident we have achieved that."
Decisions made by the Fed are impacting Americans’ everyday and lifestyle choices, O’Leary further argued, including how and where you work.
"If you're going to spend a lot of money driving, you're going to pay a fortune in gasoline because that's moving back up. Looks like we're on our way back up to oil between $90 and $100. These are all political issues," O’Leary said. "In this unprecedented year… it's going to hurt somewhere. And it means your lifestyle, if you're in your early twenties, is going to be about 20% less. Sorry to tell you the truth, but that's what I do all day long and that's the way it is."
And sticky inflation, the "Shark Tank" investor predicted, isn’t cooling down any time soon.
"People are looking at the cost of energy, protein, car loans, mortgages. And these are complicated situations because of the rate hikes that happened so quickly. But there's no question inflation is not going down," O’Leary noted.
"It will be a very hot political potato and it's going to become an issue because it hits you every day at the pump. It hits you every day at the grocery store," he continued. "And that is what really hurts mandates. Inflation has been hurting presidential runs on both sides of the aisle for decades. It's nasty."
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A FOX News poll conducted in August reported that eight in 10 voters say the economy is in bad shape. Additionally, the share of voters feeling dissatisfied with how things are going in the country is up 17 points since Biden took office.
Twenty-five percent feel the White House has made the economy better, up from 17% last summer. Still, twice as many say it has made things worse (52%), and one in five says it made no difference (22%).
FOX Business’ Megan Henney and FOX News’ Dana Blanton contributed to this report.
