Jurgen Klopp joked Pep Guardiola should take a four-year sabbatical when his Manchester City contract expires at the end of the season.
Guardiola has led City to four Premier League titles in the last five seasons, but his future at the Etihad Stadium is unclear with less than 12 months remaining on his deal.
On Friday, Guardiola said he was not considering his contract situation for the time being, declaring there would be "plenty of time" for talks after the Premier League breaks for the World Cup next month.
Liverpool have often suffered due to Guardiola's brilliance, finishing as Premier League runners-up to City on two occasions, and Klopp says there can be no questions over his rival manager's quality.
Asked whether he thought Guardiola would remain at City beyond this campaign, Klopp said: "I would prefer for Pep to be doing a sabbatical for four years or something, 100 per cent.
"Actually, my preferred solution would have been if he had a sabbatical these past four years. Honestly, it's a joke, but I have no idea.
"I've said it, I don't know how often; he is the best manager in the world. He has proven that all the time, every day. It's special, what they are doing, and I respect that."
Asked whether Guardiola's incredible standards made his own job the toughest in football, Klopp said: "Yeah, but it's fine, I am a very happy person. I have no problem with the situation.
"I'm not [Roger] Federer and Pep is not [Rafael] Nadal, they compete on the highest level and are best friends. Pep and I are not best friends because we don't know each other.
"But I respect him a lot, I know he respects what we are doing as well, so that's fine. For a rivalry you don't need to be disrespectful.
"Around the games, we have a good relationship; during the games we are both competitors. I could always admit brilliance when I saw it, and with him, that's the case."
While Guardiola has brought 11 pieces of silverware to City since his 2016 arrival, he has yet to deliver the Champions League trophy, but Klopp says that has no bearing on his standing in the game.
"I am not here to name City's targets. They are the best team in the world, I think it's obvious," Klopp said. "I think they won an awful lot, to be honest, and were unlucky in moments to not go through in the Champions League, nothing else.
"Last year they should have gone through, but that's how life is. From a sports point of view, I couldn't respect what they do more, that's the 100 per cent truth.
"What Pep is doing, it's absolutely outstanding. He will never stop, he wants to win each game desperately… he has so many things which are special for a manager."