Why Investors Prefer Real Estate to Stocks, Bond and Gold
Americans still feel skittish about the stock market. When it comes to long-term investments, real estate is still preferred over cash or the stock market, Bankrate.com reports in a new study. For long term investments over 10 years or more, 27 percent chose real estate, 23 percent preferred cash investments, and 17 percent opted for the stock market. Gold and precious metals came in fourth at 14 percent, and bonds debuted at 5 percent.
Related: Clinton’s Capital Gains Tax Plan Aims at Long-Term Investment
Although the S&P 500 has risen 27 percent over the past two years, Americans were only slightly more inclined to favor stocks in 2015 than they were in 2013.
The only exception to the brick and mortar policy? Households headed by college graduates were the most likely to prefer stocks. In the western U.S., real estate was preferred nearly two to one over any other investment choice.
The survey of 1,000 adults living in the continental U.S. yielded some surprises across gender, age, income, location, and political party. Men were more likely to favor real estate, while women were more likely to favor cash investments.
At 32 percent, the majority of millennials--those between 18 and 29 years old--favored cold, hard cash, while 32 percent of participants between the ages of 30 and 40 stuck with real estate.
Related: U.S. Real Estate ETF Rally Faces Test With Rate Rise
Lower-income workers with salaries of less than $50,000 felt “more secure” than their higher earning counterparts, who were making $50,000 to $74,900. And Republicans were three times more likely to say they felt “less secure” about their jobs as Democrats.
Bankrate’s Financial Security Index for July remained positive for the 14th consecutive month. However the July reading was the second lowest in 2015, due in part to a decline in job security with 22 percent feeling “more secure” about their jobs than 12 months ago and 14 percent feeling “less secure.” Sixty-two percent felt “about the same.”
Chart of the Day: Why US Fertility Rates Are Falling
U.S. fertility rates have fallen to record lows for two straight years. “Because the fertility rate subtly shapes many major issues of the day — including immigration, education, housing, the labor supply, the social safety net and support for working families — there’s a lot of concern about why today’s young adults aren’t having as many children,” Claire Cain Miller explains at The New York Times’ Upshot. “So we asked them.”
Here are some results of the Times’ survey, conducted with Morning Consult. Read the full Times story for more details.
A Record Low 47% of US Adults Say They're 'Extremely Proud' to Be American
Gallup says that, for the first time in the 18 years it’s been asking U.S. adults how proud they are to be Americans, fewer than half say they are "extremely proud." Just 47 percent now say they’re extremely proud, down from 70 percent in 2003.
Another 25 percent say they’re “very proud” — but the combined 72 percent who say they’re extremely or very proud is also the lowest Gallup has recorded. Pride levels among liberals and Democrats have plunged since 2017. Overall, 74 percent of Republicans and just 32 percent of Democrats call themselves “extremely proud” to be American.
Pfizer Has Raised Prices on 100 of Its Products
Weeks after President Trump said that drugmakers were about to implement “voluntary massive drops in prices” — reductions that have yet to materialize — Pfizer has raised prices on 100 of its products, The Financial Times’s David Crow reports:
“The increases were effective as of July 1 and in most cases were more than 9 per cent — well above the rate of inflation in the US, which is running at about 2 per cent. … Pfizer, the largest standalone drugmaker in the US, did decrease the prices of five products by between 16 per cent and 44 per cent, according to the figures.”
Crow notes that Pfizer also raised prices on many of its medicines in January, meaning that some prices have been hiked by nearly 20 percent this year. The drugmaker said that it was only changing prices on 10 percent of its medicines and that list prices did not reflect what most patients or insurers actually paid. The net price increase after rebates and discounts was expected to be in the “low single digits,” the company told the FT.
Chart of the Day: Pass-Through Tax Deductions Made Easy
The Republican tax overhaul was supposed to simplify the tax code, but most experts say it fell well short of the goal. Martin Sullivan, chief economist at Tax Analysts, tweeted out a chart of the analysis required to determine whether income qualifies for the passthrough tax deduction of 20 percent, and as you’ll see, it’s anything but simple.
A Conservative Bashes GOP Dysfunction on Spending Cuts
Brian Riedl, a senior fellow at the conservative Manhattan Institute, offers a blistering critique of congressional Republican’s problems cutting spending:
Since the Republicans took the House in 2011, nearly every annual budget blueprint has promised to balance the budget within a decade with anywhere from $5 trillion to $8 trillion in spending cuts. And yet, you may have noticed, the budget has not moved towards balance. This is because the budget merely sets a broad fiscal goal. To actually cut spending, Congress must follow up with specific legislation to reform Medicare, Medicaid, and all the other targeted programs. In reality, most lawmakers who pass these budgets have no intention whatsoever of cutting this spending. As soon as the budget is passed, the targets are forgotten. The spending-cut legislation is never even drafted, much less voted on.
The annual budget exercise is thus a cynical exercise in symbolism. Congress calculates how much spending must be cut over ten years to balance the budget. Then they pass legislation setting a goal of cutting that amount. Then they move on to other business. It’s like a baseball team announcing that they voted to win the next World Series, and then not showing up to play the season.
Read the full piece at National Review.