Oahu Q4 Prices drop for first time in 8 years

According to the Star-Bulletin:

The number of previously owned homes sold on Oahu fell 11.4 percent in the fourth quarter compared with the same period last year, ending more than eight years of quarterly increases.

The "good" news is:

Harvey Shapiro, research economist at the Honolulu Board of Realtors, said the board is not concerned about the decline in volume because sales previously had risen for 33 straight quarters. The drop in the number of sales does not validate any predictions of bursting bubbles, he said.

"This doesn't speak at all of a bubble," Shapiro said. "The bubble (that) people have been talking about is prices."

So, Mr. Shapiro is saying that the level of inventory won't affect prices? What's this supply and demand I keep hearing about?