Gold fever has been in effect over the last two years, and it doesn't seem to be abating as Americans say that it is their top pick for long-term investments.
Gold fever has been in effect over the last two years, and it doesn’t seem to be abating as Americans say that it is their top pick for long-term investments, according to a Gallup poll.
Although the price of gold has dropped from its high in September 2011 of $1,924, the current $1,590.55 remains far above the $600 level from five years ago. But as the price dropped, so did the percentage of Americans who chose gold. In August, just before gold prices hit their peak, 34% of Americans chose gold as the best long-term investment. According to latest numbers from April, 28% choose gold.
“Investing in gold has gained in popularity in recent years as low interest rates have made traditional savings instruments less attractive, and instability in the stock and real estate markets has undermined the mass appeal of those options,” according to Gallup.
Real estate is the second best option for long-term investments, with its support relatively unchanged in the last eight months at 20%. Stocks/mutual funds tied for third with savings accounts/CDs with 19%. Savings accounts/CDs gained more support since last August when only 14% of American chose them. Bonds lost a little support at 8%.
Men (34%) are more likely to favor gold than women (22%), while women (23%) favor savings accounts/CDs more so than men (15%). Others who prefer gold for long-term investing are adults over the age of 35, Republicans, middle-income Americans and those without a college degree.
Democrats, younger adults and lower-income Americans join women in preferring savings accounts/CDs. High-income Americans are spread out equally amongst the investments, except for savings accounts/CDs, which they are less interested in.
When gold isn’t an option, real estate takes the top spot with 31%. Understandably though, the perceived value of real estate fell sharply between 2002 and 2007, and fell further as a result of the recession.
The recession also affected confidence in stocks/mutual funds. In the five years leading up to the recession, those investment types had increased support, which plummeted in 2008 and 2009. Now, stocks/mutual funds are partially recovering that confidence.