2 ms·
my understanding is that you can buy government bonds indexed to certain measures of inflation. TIPS, I believe they are called. Obviously, they yield less tha
by lsc 16y ago
my understanding is that you can buy government bonds indexed to certain measures of inflation. TIPS, I believe they are called. Obviously, they yield less than a regular bond, if inflation doesn't go up, but they do keep you in positive territory, if inflation does go up.
- vanschelven 16y agoIndeed. However, TIPS also provide a nice counterpoint against mjs' claim that "If you're getting less than 3% out, stocks aren't worth it." In 2010 TIPS did not necessarily keep you in positive territory.
- smeatish 16y agoTIPS currently have negative real yields - you pay for the privilege of hedging against inflation. When inflation is expected, TIPS do not necessarily guarantee positive real returns. http://www.bloomberg.com/news/2010-10-25/treasury-draws-negative-yield-for-first-time-during-10-billion-tips-sale.html http://www.bloomberg.com/news/2010-10-25/treasury-draws-nega...