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San Diego, CA (November 14, 2021) – Charlie Oppler, President of the National Association of Realtors®, joined CNBC contributor and radio host Ron Insana to discuss the current political climate during the Federal Legislative and Political Forum at the 2021 REALTORS® Conference & Expo. The discussion focused on how the driving forces affecting today's economy impact every American – their businesses, industries, and investment decisions.
Insana opened the program by framing the current economic environment in the United States.
"People are talking about inflation and making comparisons to periods in our economic history, like the '70s and '80s," said Insana. "I've been arguing for the last several weeks now – in a certain sense, we are in a post-war economic environment. When we compare this to periods of the '70s or '80s, I think we're largely missing the appropriate analog economic environment in which we find ourselves today."
Instead, Insana believes we should look to the World War I or II eras as points of comparison. "The pandemic was a war or an analog to a war," Insana said. "We had depressed demand for a period of time because we sheltered in place and worked from home, and if you are in a customer-facing business, there's a good chance you didn't work at all for a protracted period of time. Now we are on the other side where we had a lot of replacement income that was offered by the federal government."
Insana argued that current inflation is the result of demand normalizing but supply not keeping up. To combat inflation, Insana explained, the Fed typically raises interest rates to normalize economic activity.
Our current situation, Insana said, is a case of reduced demand and profound labor force disruptions that may last a couple of years, if not longer. Insana ended his remarks by putting our current economic state into perspective.
"At the end of the day, I do think this disruptive period comes to an end, and it doesn't have to have a violent end like a great financial crisis," Insana stated. "Programs are going to reduce the burden and bring supply back to a normal level while meeting demand, as opposed to bringing demand down to artificially low supply, which would be a recession."
Oppler then joined Insana on stage to moderate an open discussion, covering a range of topics including the bipartisan infrastructure bill, the Build Back Better plan, and the limits of a slim governing majority.
Oppler spoke about his recent visit to the White House to discuss the debt ceiling with President Biden and other business leaders – and their concerns about planning for the future. Insana reassured the crowd that he believes the U.S. is far less vulnerable than many other countries when it comes to debt-to-GDP ratios.
Oppler then turned the conversation to the state of the housing market.
"This year we're going to finish 2021 with about 6.3 million sales. Next year our chief economist projects around six million. We're also looking at potentially three to four percent appreciation versus the numbers we've met," Oppler said. "Do you see or hear anything differently in your world, is there going to be a housing bubble?"
"No, look at 2008 to where we are now. Certainly, the economics don't look like there's any housing bubble coming," said Insana. "This is just like everything else that we're dealing with in the economy today, whether it's autos, homes, computers – even Apple said they sold $6 billion less in iPhones than they would have expected because of the computer chip shortage. The price appreciation is the result of shortages."
The National Association of Realtors® is America's largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industries.
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