Comments on: Government committee recommends death to 5-year TIPS http://www.savings-bond-advisor.com/government-committee-recommends-death-to-5-year-tips/ Tue, 07 Sep 2010 20:13:43 +0000 http://wordpress.org/?v=2.0.4 by: Tom Adams http://www.savings-bond-advisor.com/government-committee-recommends-death-to-5-year-tips/#comment-29386 Mon, 13 Oct 2008 15:14:29 +0000 http://www.savings-bond-advisor.com/government-committee-recommends-death-to-5-year-tips/#comment-29386 Dan - I noticed the TIPS rate explode last week as well. But who knows what the Treasury will do. They've been a bit erratic lately. Tom Adams Dan - I noticed the TIPS rate explode last week as well. But who knows what the Treasury will do. They've been a bit erratic lately.

Tom Adams

]]> by: Dan http://www.savings-bond-advisor.com/government-committee-recommends-death-to-5-year-tips/#comment-29208 Fri, 10 Oct 2008 21:35:04 +0000 http://www.savings-bond-advisor.com/government-committee-recommends-death-to-5-year-tips/#comment-29208 Well, a mere three weeks later I must retract that statement. TIPS yields are now around 2.5% to 3% again. I don't know whether to buy TIPS now or wait and see if the Nov 1 I-bond rate grows as well. Well, a mere three weeks later I must retract that statement. TIPS yields are now around 2.5% to 3% again.

I don't know whether to buy TIPS now or wait and see if the Nov 1 I-bond rate grows as well.

]]> by: Dan http://www.savings-bond-advisor.com/government-committee-recommends-death-to-5-year-tips/#comment-27762 Thu, 18 Sep 2008 19:22:28 +0000 http://www.savings-bond-advisor.com/government-committee-recommends-death-to-5-year-tips/#comment-27762 Well, most of that interest is from the 3.5%+ real rate TIPS that were offered in the early years, and the government is already stuck with that debt. I can't imagine it would be a good idea to stop offering new TIPS now. I believe I saw the current real rate listed as "better than nothing, almost a pittance." :) I'd think TIPS would actually be cheaper for the government than nominal bonds, as investors are willing to pay a premium for the inflation protection above just the expected inflation. Well, most of that interest is from the 3.5%+ real rate TIPS that were offered in the early years, and the government is already stuck with that debt.

I can't imagine it would be a good idea to stop offering new TIPS now. I believe I saw the current real rate listed as "better than nothing, almost a pittance." :)

I'd think TIPS would actually be cheaper for the government than nominal bonds, as investors are willing to pay a premium for the inflation protection above just the expected inflation.

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