Big Apple's real estate market's taking another hit.
Google co-founder and billionaire Sergey Brin reportedly dumped his stake in a New York City investment fund for pennies on the dollar.
Landlords are suffering from rent controls and explosive costs under Zohran Mamdani's administration.
And Brin, well, he just wanted to get out before it was too late.
Art Child, I want to come to you on this here because the numbers suggest he took a $75.
Million loss.
On this. >> I wish we were all in that position.
Yeah, I don't know.
>> 75 billion? >> 75 billion, 100 billion.
>> of things, that might not be that much because it would have cost him more staying.
>> the psychological.
Pain of loss is >> that he's going to have to pay?
>> He's still taking a loss and that's always a hard thing to do.
What does this mean? >> it off on his taxes.
>> What does this mean though for Mayor Mamdani's policies?
I mean, I feel like every other topic right now we're talking about crazy economic policies that they think will work and.
Now the market is responding to them.
>> I've been following muni bond prices on this, particularly short-term.
Municipal bond prices because,.
Well, you know, there's been reporting on this on how New York City faces a weird cash crunch.
Like every business faces cash crunches for now every now and then, right?
You kind of budget for that.
You hit the short-term borrowing markets.
Because, you know, Fox doesn't have all the money in it, you know, coming in all at once to pay us, right?
So, it rolls commercial paper, right?
There's a reason why Mamdani is not rolling the equivalent of commercial paper right now because they do have a cash crunch.
And it's because.
These notes that he would have to sell, they're called revenue anticipation notes or tax tax anticipation notes, the interest rates would.
Be huge on it. >> Yeah, astronomical.
>> They're compared to other countries.
And then if you look at New York City muni bond prices, we are we are, you know, the the the prices.
Are going down. The yields, you know, the premium you have to give a holder to buy it going up.
And here's the interesting thing. He's commie.
He believes in sort of the warmth of collectivism,.
Right? He believes.
He believes in taking private property, right?
He's cuz he said it. Believes in hates the tax he hates the rich, you know, or he wants he wants the.
He thinks they're useful idiots.
And we're not even getting into the the weird cultural stuff he's into.
This is just the budget side.
But he has to tap.
The capitalist.
System known as the municipal bond market.
Now, at some point.
There's going to be a divergence between those two.
And and it's you just seeing signs of it now.
When that happens,.
I don't know, but there has to be.
Never before has New York City been run.
By a communist. The last time the New York City.
Next time the last time the municipal bond market rebelled was in the '70s when it wasn't quite communism.
It was just rank incompetence in City Hall.
You know, you didn't have any sort of budget systems.
You know what I'm saying? And they were like, "Whoa, I'm enough's enough."
This is a little different. Like, will the municipal bond market.
Finance.
A commie? >> Well, then does that force their hand, right?
Does the tide turn the other way when the interest costs go higher?
I mean, you're a real estate owner here and proud.
You saved for it. And what do you think of this in tearing down real estate values and his policies?
>> I'm not surprised by it because you see what's coming down the pike.
And to my original point, $75 million loss on the books right now might not be anything really when you think about.
What could happen in the long run.
And the truth of the matter is nobody wants to deal with it.
Nobody wants to have to fight these policies or do business here.
And so, what happens.
If everybody starts flocking out? I mean, he said that people wouldn't.
Well, a lot of people already left.
And so, if anybody who's still here then decides, "I don't want to deal with the hassle of this.
There are better places to do business or invest."
Um and they go, then the city really deteriorates.
And the sad part of that is all the people he promised he was going to help, he's actually hurting.
Not only through his own policies, but because of the flight of capital.
>> he's driving up prices. I mean, do have room in New Jersey for all of us to head over that way.
Because that's what's coming next. I mean, in mass exodus.
>> New Jersey, too. >> Yeah, I mean, it's not that much better.
>> It's not much better. But, I mean,.
You're absolutely right, Jackie. I mean, these Mondani got elected on the promise that he was going to make,.
You know, New York City more affordable, that he was going to restore housing, and all of his policies are doing the.
Exact opposite. When he talks about taking private property and making it public, you know, when he talks about, you know, punishing.
Landlords, I mean,.
He needs people like this to stay and invest in the city.
If you've ever been inside public housing here in New York City, it's called NYCHA public housing.
I've been inside.
Before for when I was a reporter here in the city for local news, and these are just not properties that anybody.
Should strive to emulate or reproduce,.
You know, across the city or across the country, rather.
And that it seems to be the path that we're on.
>> didn't know what affordability was going to be like.
My my cousin grew up in public housing in the Bronx.
My mother did as well.
Um, it used to be a stepping stone for the working class.
>>.
Mhm. >> Okay, you had to have a job.
Yeah. >> That is not the case.
>> Right, requirement. >> going to learn the hard way with >> And it wasn't that you were going to be there.
Forever. It was that hopefully there would be some mobility and you could get out, right?
>> there as long as you worked.
Right. >> That's not a prerequisite now.
But, Jerry, I want to come to you on this.