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You're listening to the Bloomberg Opinion podcast

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count US Saturdays at one in seven pm

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Eastern on Bloomberg dot Com, the

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iHeartRadio app, and the Bloomberg Business

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App, or listen on demand wherever you get

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your podcasts.

0:15

Welcome to Bloomberg Opinion. I'm Amy

0:17

Morris. This week we look at

0:20

the flu shot. Fewer kids are getting vaccinated

0:22

for flu season, and that might actually

0:24

pose a bigger problem for the older

0:27

folks around them, like their grandparents. Also,

0:29

after some severe whiplash in recent

0:32

months, it looks like home buyers are about

0:34

to catch a break, and the USDA

0:36

is releasing its food guidelines soon. But

0:39

if you're waiting for a warning against ultra

0:41

processed foods, you might be waiting

0:43

a while. But first, let's begin

0:45

with the humanities and social sciences.

0:48

Their popularity in the US has been waiting

0:50

in recent years. Bill Falls is dean

0:52

of the College of Arts and Sciences at the University

0:55

of Vermont. Earlier this year,

0:57

he told a local television station that

0:59

the school has trimmed its budget, letting

1:02

about five percent of their full time professors

1:04

go and transitioning others to

1:06

part time.

1:07

The concern that folks have had about

1:10

taking away from the humanities. Maybe

1:13

gets confused to think that somehow we don't value

1:16

the humanities or don't want the humanities

1:18

to thrive. I think it's just because of

1:21

this shift in student

1:23

interest.

1:23

It is a shift, he says, that started

1:26

to show up back in twenty ten, as

1:28

many students focus on stem fields

1:31

with skills more directly applicable

1:33

to their careers. But perhaps the

1:35

humanities and social sciences have

1:37

failed to train students to be critical

1:39

thinkers, and that may be where artificial

1:42

intelligence comes in. We get more

1:44

on this with Bloomberg opinion columnist

1:46

Alison Schrager, who covers economics

1:48

and is a senior fellow at the Manhattan Institute.

1:51

Alison, why do you say in your column on the

1:53

Bloomberg Terminal that the arts are no longer

1:55

teaching students to be critical thinkers?

1:58

Well, I mean, traditionally, you know, you would

2:00

read the great books, you would get this very

2:02

sort of like great nuanced view of history.

2:06

But it seems like more and more

2:08

that, I mean, at least we keep seeing coming

2:10

out of universities is a simple,

2:12

more reductive view of the world. And

2:16

you know that also just doesn't really

2:18

sort of ask the big questions and come up

2:20

with a sort of a way of understanding

2:23

very complex issues or really a great understanding

2:25

of history. It seems like

2:28

from definitely what we've been told or my friends

2:30

who teach in the humanities, people, you're

2:33

getting people they've sort of gone away from that,

2:35

taken sort of a different view. Some call it postmodern,

2:39

and you know, I mean, there's a lot of different viewpoints

2:42

of history. That's certainly a valid one, but

2:44

the problem is when it takes over, you

2:47

don't really sort of get those critical thinking skills

2:49

of seeing different problems from different

2:51

perspectives.

2:53

And it looks like that not only is enrollment

2:55

in humanity's dropping, but more Americans

2:57

are actually questioning the value of a college

3:00

education.

3:01

Yeah, and everyone keeps saying that that's

3:03

because students just you

3:05

know, college has got a lot more expensive, and

3:08

they want to get value for money. They want to go,

3:10

they want to study something that will give them a job right

3:12

out of school. And I think there's a lot to that for

3:14

the decline. But I think it's also

3:16

worth asking is are the communities also not

3:18

doing what they're supposed to do and students

3:21

don't want to show up for a class and be lectured

3:23

about their professor's political opinion. They actually

3:25

do want to sort of like have a better sense of

3:27

knowledge and truth. And you know,

3:29

I think that's one of the reasons we've lost sight of why

3:31

the humanities is actually very valuable

3:33

and actually I think are going to be more valuable than

3:35

ever for the way the economy is changing.

3:37

Let's get into that. This is where AI comes

3:40

in then, and changing of the economy. How

3:42

does that fit into this puzzle and make

3:44

humanities maybe more valuable.

3:47

Well, I mean, no one knows what AI is going to mean for the labor

3:49

market. There's a lot of doom and gloom. So I'm

3:51

just going to rely on I think

3:53

I mentioned to you I've not actually taken a lot of humanities

3:55

in my own education, but

3:58

I did take a lot of economic history, uh,

4:00

just because I went to college in Scotland

4:03

where they make you do that, and so I

4:05

did study a lot of the Industrial Revolution

4:08

and what that did to labor. So I'm

4:10

going off my own history education of

4:12

what I think could happen with AI, and

4:15

what we found in the Industrial Revolution

4:17

is labor did find a way, but

4:19

the found the way if you managed to

4:22

work with the new technology rather than be replaced

4:24

by it. And so when it

4:26

comes to artificial intelligence and it can do thinking,

4:29

you know, you want to be someone who can really

4:32

think well, so you can compliment that,

4:34

like you know, you could I use AI right

4:36

now, and I'm sure in the future a w'll be more as

4:38

like almost like a research assistant for me myself.

4:41

You know, it sort of digs up stuff,

4:43

but I still am as a critical thinker then

4:46

think, all right, give this information AI has given

4:48

me, I take it to that next level. So

4:50

critical thinking skills is a great

4:52

compliment to AI. And if you just

4:55

sort of had this very reductive simple view of the

4:57

world, well then you know, AI can

4:59

do what you can do. So we really

5:01

need to be thoughtful thinkers and like just sort

5:03

of learning vocational skills in college, those

5:06

are the skills they're going to be replaced. So

5:08

we really want to learn how to think

5:10

well, and how to think critically, and how

5:12

to especially people's skills, how to

5:14

get along with people different ideas, how to weigh

5:17

different arguments. I mean, this is really

5:19

what you're going to learn. I have to learn how to do to thrive

5:21

in the New Economy.

5:22

And we are talking with Bloomberg opinion columnist

5:25

Alison Schreeger about how AI can

5:27

help make humanities degrees more

5:29

valuable. And Alison, let me see

5:31

if I can sum up what you've just said. I want to make sure

5:33

I'm following you here. The student

5:35

would eventually be competing

5:38

in a way with AI, so they'd have to

5:40

be critical thinkers in a way artificial

5:42

intelligence cannot be, and that

5:45

gives them the skill that is more

5:47

marketable, something that AI doesn't

5:50

offer.

5:51

Yeah, I mean everyone who is an AI

5:53

enthusiast tells me AO would be doing critical

5:55

thinking. But from well, I understand

5:57

at least for large language models, and maybe things will

6:00

change. It's really good

6:02

at taking a lot of sort of existing information

6:05

and sort of finding sort of the

6:07

most common argument with that, And

6:11

so I mean that's useful, that gives you a lot,

6:13

But when it comes to sort of coming up with novel information

6:16

or sort of being faced with new information, I

6:18

know for my own work with statistics, it's less good

6:20

for that. So while it's valuable and

6:22

informs you really being able to think

6:24

critically, how to really sort of understand

6:27

different arguments and where they're coming at you and how to synthesize

6:29

them actually becomes really

6:31

valuable. And AI is super helpful but actually

6:34

doesn't replace you.

6:35

Is critical thinking just too hard? I mean, how

6:37

did we get here to the point where critical

6:39

thinking isn't valued or isn't taught?

6:42

Well, it is hard, and it's really I got

6:44

to say. I mean, I did a PhD,

6:46

so I got pretty I guess advanced thinking

6:49

skills, and I found the process

6:51

very unpleasant. It's

6:54

terrible. I mean it's

6:56

upsetting as well for college students of all ages. It

6:58

always has been, and I mean, I think this is an issue.

7:00

It's not just that the curriculum gotten

7:02

less critical. It's also gotten less rigorous, because

7:05

you know, most ideas you have

7:07

when you're young are kind of bad and stupid or

7:09

derivative, and you know you need professors

7:12

to tell you that, Like yeah, like a gazillion

7:14

people said that about Plato with the first time they read it, and they're

7:16

wrong, and here's why. And that's unpleasant to hear. I

7:20

could tell, I could mark of my own

7:22

education how upsetting it was to be told my ideas

7:24

were derivative or not very good. But

7:26

that's how you get better. And I feel

7:28

like, you know, the humanities are supposed to be the

7:31

tough ones who are like, guess what, you're kind of dumb.

7:33

Here's how to think better. And I

7:35

think there's a reluctance I noticed

7:37

when I've teached to sort of be direct

7:40

with students about that.

7:41

Now are reluctance to be more direct

7:43

with students?

7:44

Yeah, as I said, because critical thinking skills are

7:46

very unpleasant to acquire. They're incredibly

7:48

valuable, yes, but they're hard to teach

7:51

and they're even more unpleasant to acquire.

7:54

And I feel like, you know, humanities

7:56

are uniquely positioned to impart

7:59

that, but just not really

8:01

doing that work anymore.

8:02

Is this a US phenomenon or is this something

8:05

we'll see globally?

8:06

I think it's global. I mean, I'm I

8:09

said, I went to a university in

8:11

Europe, and you know, from

8:13

what I observe, I think it's happening

8:15

there too.

8:17

At the same time, when you have more

8:20

Americans thinking that perhaps higher education

8:22

isn't worth it, do we run the risk

8:25

of going too far the other direction?

8:27

Yeah, I mean, it's definitely not

8:29

as worth it as it used to be, but it's still worth it.

8:32

I mean, all the evidence still suggests

8:34

that if you do get a good college degree, and by that

8:36

I mean go to a decent school, do a four

8:38

year degree, it does pay off. You

8:40

will not only have higher wages, but you have

8:43

more stable wages, you have much less of an incident of

8:45

unemployment. So but

8:48

I do think that the education isn't maybe

8:50

as good as it used to be in a lot of ways depending on

8:52

what you study. And so

8:55

I mean, I think we do run the risk

8:57

of you know, the US I think is often succeeded

9:01

more as an economy because we've also had the best

9:03

universities in the world. And

9:05

you know, if we don't really teach people how to be

9:08

good thinkers at our universities, then

9:10

you know, we do run the risk of people then not

9:12

going to university, and then it just becomes a vicious cycle.

9:15

I wonder where trade schools fall in here, because

9:17

we've talked before about the need for trade

9:19

schools and how we can't just write them off.

9:22

No, they're super important. And

9:26

you know, I was reading this article in The Economist

9:28

about how the trades are really sort of

9:33

dominating now the labor market, and it

9:35

reminds me, have you seen a recent episode

9:37

of South Park where

9:41

it's always so present, where they have like

9:43

this handyman who becomes

9:45

effectively the Elon Musk of That's economy

9:47

because he's the only one who can fix things. So reading

9:50

this article in The Economists, it reminded me of that.

9:53

So I mean that is also going to be an important

9:55

part of the economy. Although, to be honest, like when

9:57

I talk to like if

9:59

a plumber comes to my apartment or I do have

10:01

a contractor come, like, have

10:04

you've seen their work? Like even there, they're

10:06

not just like dirty work anymore.

10:09

Like I mean, they also have to use a lot of skills,

10:11

incorporate technology into what they do, and they

10:13

also really have to be very thoughtful about

10:15

what they're doing. Their work's getting a lot more complicated

10:17

and technical too, So it's not just a matter

10:20

of like doing a plumbing apprenticeship and then

10:22

you're good to go. I mean they've got

10:24

to really engage in, stay current

10:26

and keep learning too. I mean, as I

10:28

said, we've all got to learn how to be good thinkers.

10:30

And I mean doing a four year Lobal Arts

10:32

degree doesn't mean everyone should do it. I don't

10:34

think it's efficient that the entire popular

10:37

labor force go through that. But

10:39

you know, if you are going to go that route, that's

10:42

really I think a valuable path too, and I

10:44

think we undersell it.

10:45

Alison, thank you for taking the time with me today,

10:48

Oh anytime. Alison s Trigger is

10:50

a Bloomberg Opinion columnist who covers

10:52

economics and is a senior Fellow at the Manhattan

10:55

Institute. Coming up, we're going to look at the cold

10:57

and flu season and how some parents are

10:59

not getting flu shots for their kids, and why

11:02

you're listening the Bloomberg Opinion.

11:12

You're listening to the Bloomberg Opinion podcast

11:15

count ut Saturdays at one and seven pm

11:17

Eastern on Bloomberg dot com, the

11:19

iHeartRadio app, and the Bloomberg Business

11:21

app, or listen on demand wherever you get

11:23

your podcasts.

11:26

You're listening to Bloomberg Opinion. I'm Amy

11:28

Morris, and we are well into cold and flu

11:31

season, not just for adults, but for youngsters

11:33

too. And while every parent knows

11:35

the feeling of helplessness when your little one has

11:37

a nasty cow or a fever, not every

11:39

parent is making sure their child is

11:42

vaccinated. Westchester County

11:44

Health Commissioner doctor Shirlita Ambler in

11:46

New York says people need to get those

11:48

flu shots, even if they're tired of hearing

11:50

about vaccines.

11:51

I if anyone understands that there's a lot

11:53

of vaccine fatigue out there,

11:56

but we still have to work to protect

11:58

ourselves and our family and

12:01

everybody that we care about.

12:02

Let's get more on this with Bloomberg opinion columnist

12:04

Lisa Jarvis. Lisa covers biotech,

12:07

healthcare, and the pharmaceutical industry.

12:10

Lisa, does that make sense to you that

12:12

there's just this vaccination slash

12:14

shot fatigue and folks are tired

12:17

of hearing about it and don't want to deal.

12:18

Yeah, you know, I think that's certainly part of

12:20

it. I think there's a confluensive

12:22

issues potentially happening related

12:25

to the rollout of the COVID vaccines,

12:27

which might have made it

12:29

so that people were having a

12:31

hard time finding that vaccine and they were planning to

12:33

get their flu shot at the same time and didn't

12:35

do either if they couldn't find the COVID one.

12:38

But certainly, you know, we have heard

12:41

a lot for a while, every six months

12:44

reminders to go get some sort of shot

12:46

or another, and you know, I think people

12:48

are starting to tune out a little bit. I think there's

12:50

a number of things good on and I'm happy to talk about all

12:52

those.

12:53

Yeah, let's get into that. Why the hesitancy?

12:55

What are some of the things that are going on.

12:57

It's easy to kind of reflectively think,

12:59

oh, it's COVID vaccine

13:02

driven hesitancy. That's the reason behind

13:04

this flu shot decline in kids.

13:06

And it's a modest decline, but it matters

13:08

because kids already weren't getting vaccinated

13:11

at the rate that we'd like to see them at, because

13:13

they're really important part

13:16

of protecting adults when it comes to the flu.

13:18

Older adults are the ones who are most vulnerable

13:20

to the worst outcomes. But you

13:23

know, as I mentioned, the commercial rollout of COVID

13:25

shots really hit the pediatric

13:27

vaccines the hardest, and so parents

13:30

were scrambling for weeks after

13:32

the vaccines were supposed to be initially available

13:34

looking for those shots. And any parent

13:36

that's had their kids vaccinated nose you

13:39

only want to go once and get both

13:41

shots at the same time, so

13:43

you don't have the angst of two trips and

13:45

more tears potentially, And so you

13:48

know, if someone couldn't find a shot, they might not

13:50

have gotten it at all. And there were some wrinkles

13:53

when it came to coverage of the COVID

13:55

shot. Initially not all insurers had the

13:57

right coding in place, and so if you

13:59

went in you had an appointment and then we're

14:01

told you were going to have to pay for it out of pocket, you might

14:03

have decided not to get either vaccine.

14:06

And then anecdotally, you know,

14:08

I've heard from pediatricians and I've noticed

14:10

this in my own community that there have just

14:12

been fewer vaccine clinics. A lot

14:14

of times pediatricians' offices will run,

14:17

you know, several weekends in a row of flu vaccine

14:19

clinic and it's just like a mill, bring your whole family

14:22

in and get the shots. And a lot of them didn't

14:24

do that this year. In part, it seems like because

14:27

there's just a shortage of healthcare workers,

14:30

and so I think it's a complience

14:32

of things happening, but all of it kind of translates

14:34

into not a great situation.

14:37

Do we know how many kids so far

14:39

have gotten the flu shot percentage

14:41

wise and what the goal is?

14:43

Yeah, so as of early

14:45

November, because there's a little lag in the data that

14:47

we see from CDC the

14:49

national numbers where thirty six point five

14:52

percent of kids had gotten their shot last

14:54

year and this year it was thirty

14:56

two point six percent. That's the lowest

14:58

in five years. Twenty

15:01

nineteen, the trend had been overall

15:03

kids were starting to get more their

15:06

flu shot more consistently, and then we saw a

15:08

little leap that first year of

15:10

COVID. I think parents feeling helpless

15:12

without a COVID shot. We're pretty good about getting their

15:14

kids their flu vaccine, and we've just seen

15:16

a decline. Since the

15:19

goal always is to get seventy percent

15:21

of the population vaccinated, we

15:24

never get to that place in the US,

15:27

you know, I think we do the best, which

15:29

is good with older folks, but older folks

15:31

also have immune systems that just don't

15:33

aren't as robust even with vaccination,

15:36

and so they rely on the rest of us

15:38

to kind of help cocoon them from

15:40

the worst outcomes of the flu.

15:41

You were just talking about the elderly. Let's talk

15:44

about that a little bit more. The

15:46

risk isn't necessarily then, from

15:48

what I'm hearing you say, for children

15:50

per se, it's

15:52

for the spread to make sure the kids

15:54

don't give it to grandma and grandpa.

15:56

That's right. I mean, just like we've all

15:58

come to learn very well with the COVID

16:00

shots, the flu shot isn't necessarily going

16:03

to prevent you from getting the flu, but but like

16:05

it does actually help lower

16:07

the spread of the virus.

16:09

And kids are vulnerable to

16:11

you know, hospitalizations from the flu, just

16:14

like they are from COVID. But really the

16:16

biggest threat here is to

16:19

you know, grandma and grandpa, and so, you

16:21

know, folks over the age of sixty five are the ones

16:23

who end up with the most hospitalizations and are

16:25

responsible for, you know, the majority

16:27

of deaths. One thing that

16:30

I always keep in mind is that there was a study

16:32

that people still cite kind

16:34

of Japan that showed that when

16:37

you had a high percentage of school

16:39

age children vaccinated, you actually

16:41

saw fewer deaths among older the

16:43

older population. And so, you know,

16:45

it just is it's I try to think

16:47

about that when I think about why it is that,

16:50

you know, I take my own kid in to get her flu shot.

16:52

It's for her, but it's also for the people around

16:54

her.

16:54

Are there efforts being made on the

16:56

government level, on the school level,

16:59

the local level, to get more kids

17:01

vaccinated. Is there a push there.

17:03

I think there's always been a push, and the

17:05

CDC had a different blue

17:07

vaccine campaign. They try to change their

17:09

messaging up a little bit this year,

17:12

essentially to try to get at this idea

17:14

that it's not gonna prevent

17:17

you necessarily from getting the flu, but when you

17:19

get the flu, it's not going to be a severe and

17:22

they I think, you

17:24

know, we're seeing mixed success with that.

17:27

It's a complicated season, you know, to

17:29

be fair, We've got COVID

17:31

shots that we're rolling out, the flu

17:33

vaccine, and then there's new RSV

17:36

shots for older folks and in RSV

17:38

preventive therapy for infants,

17:41

and so I think just the

17:43

messaging has been really muddled

17:47

because people are trying to keep track of a lot of things.

17:49

And as you know, you pointed out the very beginning,

17:51

this is coming amid some fatigue

17:54

around getting shots in general.

17:57

Are there certain areas of the country

17:59

that are are not getting vaccinated?

18:01

Is it demographically divided?

18:03

Yeah? I mean so, I think one

18:06

of the reasons that there's you know, concern

18:08

around hesitancy is because when you look at

18:11

the map of the places that have dropped

18:13

the most in terms of kids in flu vaccines.

18:16

You know, many of them are in red states, some of them are

18:18

in states where the political rhetoric around

18:20

vaccination of COVID has been

18:22

the hottest. And so you know Florida,

18:24

for example, which has

18:27

been in the bottom kind

18:29

of twelve states in general in

18:31

the past when it comes to vaccinations

18:34

for the flu for kids, but this year they

18:36

saw another drop in their vaccinations.

18:39

And you know, we know we've heard that Governor

18:41

Ronda Santis in his presidential campaign

18:43

has really been kind of hitting

18:45

on COVID vaccines and initially wasn't

18:47

even going to participate in some of the booster

18:50

rollouts for that, and so you know there's a worry

18:52

that that's bleeding over into other

18:54

childhood vaccinations.

18:56

I want to talk about that just briefly, because

18:58

you know, COVID, a rather vaccination

19:01

hesitancy or anti vax

19:03

if you will, is not new. That's been

19:05

going on since before COVID. I'm

19:07

wondering though, if now that we're seeing

19:10

parents more hesitant to get the flu

19:13

shot for their kids, is it becoming

19:15

more mainstream. It used to be such an outlier.

19:18

Now are more parents sort of jumping on the anti

19:21

vax bandwagon. Where could this wind up?

19:23

Yeah, it's really worrisome, to be

19:25

honest with you. This is a thing that I've been trying

19:27

to watch closely, and I think everyone is trying

19:30

to see with every new scrap of data

19:32

comes out, you know what it means. We

19:34

saw that there was a drop

19:36

in childhood vaccinations for kindergarteners.

19:39

You know, when you go into school for the first time,

19:41

there's a series of shots that you need to have. And

19:44

fewer kids in January when the data came

19:46

out, were up to date in twenty twenty two than

19:48

had been in the past, which

19:50

is concerning. I think it's hard to

19:52

unravel if it has to do with vaccine

19:55

hesitancy, if it has to do with fewer

19:57

people having access to healthcare. You

20:00

know, I probably is a number of

20:02

factors. What does seem to be happening.

20:04

They're kind of hardening into you

20:06

know, I feel really good about vaccines or I

20:09

really don't feel good about it, instead of there's

20:11

less folks living in that grey

20:13

area, and so that's

20:15

worrisome, and I think, you know, certainly

20:18

there's things that we need to be doing to understand

20:20

where the demographics and where

20:22

that's happening, and to be thinking about how

20:24

to better target those folks.

20:25

Bloomberg Opinion columnist Lisa Jarvis

20:28

covers biotech, healthcare, and the pharmaceutical

20:30

industry. This is Bloomberg Opinion.

20:42

You're listening to the Bloomberg Opinion podcast

20:45

Countess Saturdays at one and seven pm

20:47

Eastern on Bloomberg dot com, the

20:50

iHeartRadio app, and the Bloomberg Business

20:52

App, or listen on demand wherever you get

20:54

your podcasts.

20:57

This is Bloomberg Opinion. I'm Amy Morris.

21:00

Home Buyers have been suffering through some

21:02

pretty severe whiplash in recent

21:04

months. After hitting eight percent in

21:06

October, mortgage rates are now kind

21:09

of flirting with seven percent. There's some signs

21:11

that sales and inventory are picking

21:14

up. Let's learn more about this where

21:16

this could be headed. Bloomberg Opinion

21:18

columnist Connor Sen joins me now. He is

21:20

a founder of Peach Tree Creek Investments

21:22

and has been following the housing market very

21:25

closely. Obviously, now, Connor,

21:27

what has changed.

21:29

It's really mortgage rates. That's the show stopping

21:32

story. Where when rates hit eight in October,

21:34

I think a lot of people said this is ridiculous. I'm

21:36

not going to try to buy a house. I'm not going to try

21:38

to sell a house. It's just it's broken.

21:41

And then mortgage rates just have basically

21:43

crashed over the past month due to a

21:46

decline in inflation to some extent, some softening

21:48

in the economy, and a belief that the FED will cut

21:51

rates perhaps in the first half of next year, maybe

21:53

as soon as March. And so rates have come

21:55

down a lot, and it happening at a

21:57

time of the year when people typically aren't buying

21:59

houses. Maybe hasn't led people to appreciate

22:01

that, but I think it sets the housing market up for a really

22:04

interesting January.

22:06

The US housing market, though, has been

22:08

defying expectations. When you think it's

22:10

going to zig its zags. Is that

22:12

going to continue?

22:14

I think so.

22:14

And the same thing happened a year ago. If

22:16

you're a call, where rates hit seven in

22:19

October twenty twenty two, and that was at

22:21

the time sort of unheard of, and

22:23

people gave up on the housing market for the year, and

22:26

then people came back in January and a lot of people

22:28

who felt like they had to buy a house, they just

22:30

went out there and tried to look and

22:33

at the time it was the new home market that had

22:35

supplied because builders had built

22:37

up these big inventory levels when rates

22:39

were lower and they had to sell them. So builders were

22:41

in a position to sell homes

22:43

to people who suddenly needed to buy them, in

22:45

some cases using mortgage rate buydowns to make

22:48

the rate more affordable. And that led to

22:50

the first quarter of the year being surprisingly strong

22:52

for the new home market. And I think

22:54

now that we're seeing some signs of loosening

22:56

in the resale market on the inventory

22:58

side. We could see the same for existing

23:00

home sales in the first quarter of twenty twenty.

23:02

Four, so we have seen this pattern

23:04

before then as recently as this time last

23:07

year.

23:07

Exactly. It really is kind of an eerie groundhog day

23:10

where you see mortgage purchase applications

23:12

pick up in November, but people are busy

23:14

with the holidays, maybe not paying attention, but

23:17

you see signs in the weekly data that people

23:19

are responsive to rates, and now that there's more

23:21

supply, there's more choice for

23:23

buyers, and I think again we're going to get

23:25

past Christmas in the new year. First couple

23:27

weeks of January, people went out there and you could see

23:29

a lot more activity than people think.

23:31

So that's when home buyers are going to start to see

23:34

or feel that break and that

23:36

pressure that you've been talking about coming

23:38

up in January, the first quarter of twenty

23:40

twenty four.

23:42

Right, the seasonality in the housing market's really gotten

23:44

weird since COVID, and I think maybe a part of it

23:47

was COVID. Part of it just mortgage rates are

23:49

so high that or went from so

23:51

low to so high that it's a scrambled things. And

23:53

then just the general lack of inventory has made

23:55

it so that if you want to sell home, you

23:57

can almost always sell it, no matter what time of the year

24:00

you want. And then there are so many people looking to

24:02

buy that you do have people looking

24:04

to buy in November December just because they

24:06

didn't they weren't able to in May, June, July.

24:09

You know, let me clarify something with you, or

24:11

get you to help me clarify it. You know,

24:13

we started this by talking about home

24:16

buyer suffering through the whiplash, and now

24:18

they're about to get a break. What's that break

24:20

going to look like exactly? Will

24:23

it be stability, will it be affordability?

24:25

What's the break they're waiting for?

24:28

I think mortgage rates being lower all

24:30

else EQL makes affordability better. I

24:33

think the home price conversation is tricky, and we can

24:35

get into that a little bit later, but I think the real

24:37

one is just that there will be more inventory,

24:40

and so if you've been feeling like there's nothing

24:42

to buy, there'll be a little bit more choice. And

24:44

that goes for first time buyers as well as people who

24:46

have a home to sell before they can buy. So if

24:49

maybe you haven't been selling your home because

24:51

you haven't found the one you like, and now if

24:53

you do find one you like, you can sell your own home,

24:55

which then creates inventory for somebody else. So it kind

24:57

of just unfreezes the market a little bit.

25:00

And we are talking with Bloomberg opinion columnist

25:02

Connor Sen about home buyers

25:04

finally starting to see a little bit of light at

25:06

the end of the tunnel. However, Connor, you just

25:08

said that the outlook for prices is tricky.

25:11

How so I think you're rising

25:13

inventory all SEQUL should put a little bit

25:16

of downward pressure on prices because maybe

25:18

price is held up this year just because there was nothing

25:20

to buy and so there just wasn't

25:22

an ability for prices to fall when there's

25:24

always a buyer to step in whenever anything

25:26

went for sale. So like Redfin,

25:29

the online brokerage site, predicts that home

25:31

prices will fall one percent twenty twenty four.

25:33

And my view is that could they fall a little

25:35

bit, sure, could they rise a little bit if mortgage

25:38

rates fall, definitely, But

25:40

it's really I think people have been looking for

25:42

shelter. Think of it as are you looking

25:44

for shelter and shelter that you own? And

25:46

if so, then you should be focused on can

25:48

I just secure the house I want? And

25:51

am I going to pay two percent too

25:53

much or too little? I don't know. I don't think you're looking

25:55

at a big decline or big rise in either

25:57

case. It's really just about it should be easier

25:59

to find the home you want in twenty twenty four.

26:02

Let's get a little more granular with this. There

26:04

was a time, particularly during

26:06

and just after COVID, when

26:09

people were just throwing money

26:11

at realtors and throwing money at

26:14

sellers. Whatever you're asking price is,

26:16

I'll top it by another twenty grand, and

26:20

they were selling houses. We're not seeing

26:22

that. You don't anticipate that, do you?

26:25

No?

26:25

I don't think we're going to see big price booms like that.

26:27

You might see bidding wars again, but

26:30

that will be more about four people

26:32

competing for one house and only one person

26:34

can get it, even if I don't know if it'll be somebody

26:36

will pay ten percent over just that, There's

26:38

still are only so many houses to go around, and

26:41

I think you will see more inventory next year, more

26:43

more sellers, more new listings, but

26:45

buyer demand could come in strong, just

26:48

sort of people coming off the sidelines in response to not

26:50

just rate stability, but rates declining.

26:52

And are we seeing more of the flip side of

26:54

that, coin sellers who are

26:57

basically cleaning out a house, not

26:59

really doing much with it cosmetically,

27:02

not worrying about an inspection, and just selling

27:04

it as is and getting it off their plate.

27:07

I think so.

27:07

And when inventory is low, they have the ability to

27:09

do that, to just wave inspections and not

27:11

do a whole lot of work because they know there is a buyer for

27:14

the home, even in the shape it's in. And so

27:16

again we'll see more inventory next year. I don't

27:19

think it's going to be just a deluge,

27:21

but it should be better than twenty twenty three, and sort

27:23

of in my business. Just the direction and

27:25

the change is more important than the levels.

27:28

So the problem had been that people weren't selling.

27:30

Why are they more motivated to sell now? I

27:32

mean, is it beyond just the interest

27:35

rates?

27:36

It's time. So yeah, rates

27:38

were low until about April May of twenty

27:40

twenty two, and then rates shoot up. If

27:42

you're a seller, you think, I don't want to get in there,

27:45

I'll just wait until rates come down or

27:47

whatever, and then time passes

27:49

and eventually you just have to sell in a lot of cases,

27:52

and sort of the interesting

27:54

thing is one of the places where inventory is rising

27:56

the most right now is Florida as well as Arizona,

27:59

and I want or if it's because there are more retirees

28:01

there, and so you do have more people just

28:03

you know, dying or having to move into assisted living,

28:06

and just you have people who sort of physically

28:08

can't afford to wait and they're putting their homes in

28:10

the market or they're a status putting their homes in

28:13

the market.

28:14

Now, you had said earlier in this interview that

28:16

we've seen this before. Is

28:19

this now the new pattern? Is this what we

28:21

need to start anticipating in the

28:24

next few years? Is

28:26

this sustainable?

28:29

I think twenty twenty three was peak mortgage rate

28:31

lock in because you had sort of the most

28:33

number of people with three percent mortgage rates

28:35

that you'll ever see, and they

28:37

also had had them for a very little amount

28:40

of time. They hadn't been in their homes that long, so they

28:42

could afford to wait a year and just not sell their home

28:44

and wait for things to settle out. And

28:46

now every year that passes there'll be fewer people with

28:48

those pandemic error mortgages and more people

28:50

who, whether it's for marriage

28:53

or kids or death or divorce, whatever, feel

28:55

they need to sell. And so I think from here inventories

28:58

likely tick up, not rapid, but I think you'll

29:00

see more supply in twenty twenty four than

29:02

you did in twenty three, probably more in twenty five than

29:05

you will in twenty four, and so it should get largely

29:07

better from here.

29:08

So more supply in the coming year, more

29:10

supply possibly the year after that. If

29:13

I were looking to buy a

29:16

home, maybe hustle and strike

29:18

while the iron is hot.

29:20

There are a ton of buyers out there who

29:22

want to come in, want to find a home. And

29:25

again we saw in the new home market this year where I think

29:27

if you bought that home in January when builders

29:29

were still looking to sell and there were still options

29:31

out there, they're pretty happy versus people

29:33

who waited maybe thought mortgage ridge come down, thought

29:36

prices would come down. And I

29:38

think you want to get out there before spring and

29:41

there's more of awareness that, oh, rates have

29:43

come down, people are looking to buy. Beat

29:45

the crowd would be my advice to people.

29:47

When you are doing these types of analyzes, how

29:49

long does it take for the market to sort of catch

29:51

up with what it is you're saying.

29:53

Well, the nice thing about housing is that there's pretty

29:56

like certainly around this time of the year, there's pretty predictable

29:58

seasonality. Even if you I wanted to buy a home today,

30:01

it's not like maybe your wilter's on vacation,

30:04

maybe the appraiser or some

30:06

part of that chain that you need to actually

30:08

secure that home can't be reached, and

30:10

so you're kind of forced to wait until the new year. So

30:13

I think the next three to four weeks it's going to be quiet

30:15

just because you can't get people and so,

30:19

but I think you will see signs of this by mid

30:21

January.

30:21

If I'm right, all.

30:22

Right, Connor, We're going to wait and see if

30:25

you are right. Thank you so much for joining us.

30:27

Thanks Amy.

30:28

The US government's next set of dietary

30:31

guidelines for twenty twenty five may

30:33

include warnings against ultra

30:35

processed foods, but nonprofits

30:37

say, don't bet on that. There are just

30:39

too many committee members with conflicts of

30:41

interest. Bloomberg opinion columnist

30:43

Bobby Ghost joins US. Now, Bobby

30:46

first, set us straight. What's

30:48

the difference between a processed food

30:50

and an ultra processed food?

30:52

Just cooking food makes it processed, right,

30:55

But ultra process food is food that is

30:57

that essentially comes out of a

31:00

substantial degree comes out of a laboratory.

31:02

I mean they come out of factories, but they're

31:05

designed in laboratory. They're

31:07

designed using the science

31:09

of chemistry, and they're

31:13

brought together and you know the way the

31:15

US federal government defines that. It

31:17

can be quite confusing. If

31:21

you have a is

31:24

bacon a ultra processed food or

31:26

a processed food? If you have

31:29

is bread processed or

31:31

ultra process Take a guess. Most

31:33

breads are ultra processed foods. You

31:36

and I most people don't really think of bread

31:38

like that, but particularly bread that is designed

31:40

to survive for several days,

31:42

which is not a natural thing.

31:44

In bread, long life breads a certainly ultra

31:46

process long like milk is ultra processed.

31:49

All kinds of things are ultra processed.

31:51

With so much evidence though that all these foods

31:53

are bad for you, certainly the Committee

31:55

would be mentioning them in these guidelines, you

31:57

would.

31:58

Think, except, of course, the Committee

32:01

for decades has been under

32:04

scrutiny, to put it politely,

32:06

for pressured by or

32:08

influenced by big

32:10

food, the food industry through lobbyists.

32:13

Many members of the Committee have been

32:15

shown to have conflicts

32:18

of interest, to have received

32:20

money from big food to

32:23

conduct research, let's say, and

32:27

that has made its guidelines suspect

32:30

in the eyes of a lot of people, and

32:32

a lot of people who've been on the

32:34

committee before say that they come

32:36

under a lot of this pressure. Part of the

32:38

problem is that the USDA, the

32:41

Department of Agriculture. These

32:43

guidelines come out from the USDA and

32:45

the Health and Human Services, But the USDA's

32:48

primary function is to

32:50

try and promote the product

32:52

of American agriculture, you know,

32:54

to promote the kinds of foods

32:57

that are produced by American farmers,

33:01

and quite often American farmers are producing

33:04

foods for the

33:06

food industry, which then takes this stuff

33:08

and processes it and ultra

33:11

process it, if you like, and puts it on

33:13

our shelves and in our restaurants

33:15

and our fast food joints. And

33:18

so there is a direct conflict of interest

33:20

for the USDA itself.

33:23

So then what's the point of having these food

33:25

guidelines every few years?

33:27

Therefore, nutrition is they are for

33:30

policymakers. They're not

33:32

for you and me. They're not really for consumers.

33:34

There's a whole separate thing that is

33:37

designed for consumers, and that is called my

33:39

plate. You'll remember the food pyramid.

33:41

You'll have seen it in your school, right. My

33:44

plate replaced the food pyramid. Instead

33:46

of a pyramid, it's the shape of a plate. It's

33:49

like a pie chart that shows you what proportions

33:51

of different things you should eat.

33:53

But here's the thing that too, is produced

33:55

by the government, the Obama administration,

33:58

particularly Michelle Obama, the first Lady, put

34:00

quite a lot of her personal energy

34:03

into it. But that's kind of fallen by the wayside.

34:06

Even those who have heard of it. A

34:08

tiny, tiny fraction of people say

34:10

they've tried to live by the prescriptions

34:13

of my play. The larger point is

34:15

that most people know that processed

34:18

foods aren't good. If the government

34:20

is serious about getting people to

34:22

eat fewer processed foods, the

34:25

solution is not that difficult.

34:28

You tax these foods, you

34:30

subsidize the more wholesome

34:32

foods. But of course that would

34:34

involve going against very

34:37

powerful lobbyists, and

34:39

the political climate just simply

34:41

does not exist at the moment for that sort of action.

34:44

Bobby goes. She is a Bloomberg Opinion columnist

34:46

covering culture, and that does it for this week's

34:48

Bloomberg Opinion. We're produced by Eric Mallow.

34:51

Find all of these columns on the Bloomberg terminal,

34:53

and we're available as a podcast on Apple,

34:56

Spotify or your favorite podcast platform.

34:58

Stay with us. Today's stories and global

35:01

business headlines are coming up. I'm Amy

35:03

Morris, and this is Bloomberg.