we have been talking about consolidation since the gfc. since the gfc.his is one of those points i'm going to want to laugh about in a few years time from now, but i actually think as we look at the barriers to entry in this space, if we look about the cost of running our businesses, if we think about the scale that we need to operate at, and the multiples that we are starting to see coming down, i think this could be an interesting time for consolidation. francine: but why has it been a long time coming? is it regulation, or there was just no appetite? robyn: i think when cash is free, it softens that. i think the moment where people need to deploy at scale in liquid markets has been something that has softened. if you look at trends, the trend has been in passive, it has been in private equity. if you think about the assets that no longer sit in the public domain, that has been our themes over the last 10 years. i think when private equity does not have quite as much cash, when that raising is harder, when lending is harder, these opportunities for nic

these measures were introduced in the aftermath of the gfc.the time, interest rates were plunging and they needed to cool form by argument down. but this has not happened. hong kong is still the world's least affordable housing market. at the same time, it is leading to home property curbs to be removed. they were not expecting something this severe. but when you have interest rates as high as they are remaining in hong kong right now, it is difficult to see how this leads to ultimately a longer-term improvement within the local property market. what investors are looking out for is whether you see any short-term gains. they will look to see what happens with future property sales that come into the market, but it is not clear that this will lead to any long-term stability within the hong kong housing market. haidi: how strong is a correlation between whether or not we see a sustained pickup in the chinese economy, when you talk about the malaise across the property sector, tourism, retail slow down a result, is that really the crux of wonderf

now factor in the gfc when the fed was cutting rates to stimulate the economy and cre transaction activityoday. back then, lenders had incentive to work with botrrowers who wanted to keep the property. now extending loan s into the lower rate environment is not the case today. we know looking at sectors are in the biggest trouble. one sector that could see distress in the future is hotels. a lot of lodging loans are maturing this year and next. over $30 billion worth. more than one-third of those carry interest rates under 5%. while hotel did have a banner 2023, there is concern now the consumer is starting to struggle and businesses are starting to cut expenses. if leisure and business travel drop this year, that will hit the property owners hardrefinan higher interest rate environment. >> if this hits hotels, are there other sectors you are watching for distress? >> we are watching all of them. apartments are starting to cool off. they were very hot. we have a lot of supply coming on the market in apartments and you are seeing rents cool. another one that i'm hearing talk about is indust

that caused issues on the balance sheets but it wasn't asset quality deterioration like we saw in the gfcople were overpaying for those areas at the end of '22 anticipating the recession in 2023 so i think those areas are the most discounted. i think they offer a lot of upside opportunity, and you get to clip growing coupon it is you move into these areas. that's an interesting way for investors to add additional income and appreciation to their portfolio. >> john mowry with nfj investments, thank you very much we'll see you stoon, sir >> thank you >>> january's pending home sales were out this morning, and it was a big miss diana joins us with the details there. this is the residential side of things, but in homes opposed to reits. >> that's right. not only was it a december, but december's read was revised lower. pending sales in january dropped 35% month to month the street was looking for a 2% gain sales down nearly 9% year over year this is based on signed contracts, so people out shopping in january and making the deal the 30-year fixed starting down from the 8% high in october, but

require them to read anything in other words, simply a money formula afternoon is cranked out in to the gfc regardless. right? how are you going to keep them tampering with this black box that you have a thing? i'm not to have a black box. i'm going to have a very visible i've written out and as you know, i know that's a great detail. what i would do will calculate this, but then there's going be someone who'll come in, the people that dislike and say, but we could do it a little bit better by doing it this way or that way, of course. how would you keep them from doing it? well, in the only way in which you can do it, a democratic society, by establishing both a written, an unwritten and the unwritten is just as important as a written and unwritten constitution on the part of the public at large and of the view that this is not what people in government ought to be doing, that they're sacred to measure. well, if you want a monotonous profession for it in a theological sense. oh, but unfair criticism, professor friedman say, is a bad doctor because people won't actually take his medicine mea

require them to read anything in other words, simply a money formula afternoon is cranked out in to the gfc regardless. right? how are you going to keep them tampering with this black box that you have a thing? i'm not to have a black box. i'm going to have a very visible i've written out and as you know, i know that's a great detail. what i would do will calculate this, but then there's going be someone who'll come in, the people that dislike and say, but we could do it a little bit better by doing it this way or that way, of course. how would you keep them from doing it? well, in the only way in which you can do it, a democratic society, by establishing both a written, an unwritten and the unwritten is just as important as a written and unwritten constitution on the part of the public at large and of the view that this is not what people in government ought to be doing, that they're sacred to measure. well, if you want a monotonous profession for it in a theological sense. oh, but unfair criticism, professor friedman say, is a bad doctor because people won't actually take his medicine mea

>> i think that the the gfc probably actually helped fairfax.irfax was positioned well. might have even been short the subprime securities going into the gfc. yeah. what happened before, from what i can glean, is that the short pieces really revolved and didn't think they were adequately reserved. this is basically consolidated level of the accounting. abysmal basically. highly misleading. a lot of smoke in mirrors. to put it in context here, since that big acquisition in 2017, which seemed to be the company saying, hey, we need to try to grow the book value. since that acquisition about 60% of the growth in book value per share has come through these non-substantive like smoke in mirror-type transactions. so that's a different thesis from what we saw back in the early 2000s, or, you know, when the company ended up suing everybody. i think there were others. >> and pwc toronto. are you suggestingauditors aren't doing their job? >> funny about that, first time i've seen this is that pwc actually states in the audit report that it's unable to dete

the good peril for this is not our experience in gfc or japan, but it is europe. remember where we were waiting for the summit to end and merkel would come out and be supportive, use that as a support system to create a sustainable entry point. >> when you look at the middle east and the geopolitical turmoil there, what do you tell investors? not just from investing in europe and the middle east, but what about the oil outlook? >> we wrote a piece on october 8th. the day after the hamas terror attacks on october 7th. we told clients there would be limited implications of the israel-hamas war. one reason for the call at that time, iran and saudi arabia have a detente that is holding. they negotiated this in 2022. we covered that in the u.s. from the perspective that china helped negotiate that. that wass irrelevant. what was irrelevant about the deal is saudi arabia conceded to iran on the number of geopolitical issues, but in return, iran has kept the proxies from attacking the saudi energy facilities. when you think about the houthis, everyone is focusing where t

now, back during the gfc, the fed was aggressively cutting rates to stimulate the economy and cre transactione to work with borrowers that wanted to keep the properties. again, not the case today, and finally, back then, extending loans into a lower rate environment led to increasing property values, not so today in a high rate environment. so we already know that office is in the biggest trouble, but one surprising sector that could see distress coming soon, hotels, a lot of cnbs lodging loans are maturing this year and next over $30 billion worth. more than a third of those carry interest rates under 5% currently, and while hotel did have a banner 2023, there is concern that the consumer's starting to struggle. businesses are starting to cut expenses, and if both leisure and business travel drop this year, that will hit those property owners hard right when they have to refinance into much higher rates. back to you guys. >> are there specific properties that we should keep our eyes out on or specific cities where it's more trouble than others? >> look, i think we already know san francisco