Gold's traditional role as a store of wealth has been usurped by contemporary art and apartments in cities such as New York and London, according to Laurence D Fink, head of the world's biggest asset manager. "Historically, gold was a great instrument for storing of wealth," the chairman of BlackRock Inc said at a conference in Singapore on Tuesday. "Gold has lost its luster and there are other mechanisms in which you can store wealth that are inflation-adjusted."
Over the centuries, bullion traditionally lured demand as a protection of wealth during crisis, including conflicts and periods of inflation. Prices posted the first back-to-back annual drop last year since 2000 as investor holdings in exchange-traded products contracted, global equities rallied and the dollar climbed on prospects for higher US interest rates. Since peaking in 2011, it's dropped about 38%."The two greatest stores of wealth internationally today are contemporary art and apartments...and I don't mean that as a joke, I mean that as a serious asset class," he said.
The median sale price for existing condos in Manhattan jumped to a six-year high of $1.3 million in the first quarter, driven up by buyers seeking alternatives to out-of-reach new developments, according to Corcoran Group, a brokerage. In the U.K., asking prices for property climbed to a record in April as values in London rose 2.5 percent, Rightmove Plc said on Monday. "It's become much more accessible for global families worldwide to store wealth outside their country," said Fink. "And they don't have to own gold."