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I am not sure when is appropriate to use the phrase

"That's a shame"

or

"That's a real shame..."

Is it friendly? Respectful? Is it a thing very close friends or people say to each other when they want to imply the other person has not done a good job(and hence he should feel shame?)

If you can help with appropriate contexts and kind of people we can say this to that'd very helpful.

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In my experience, this is a fairly friendly phrase roughly equivalent to "That's too bad" or "I'm sorry to hear that." It doesn't have anything to do with either conversationalist feeling shame.

Person A: "I wanted to take my mom out for dinner yesterday, but there was too much snow."

Person B: "That's a shame. Maybe the roads will be clear tonight."

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