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If you click on Max, the chart indicates that the smart money expected the 10 yr inflation rate in late 2008 to be < .5%, which wasn't the case.
by omgwtfbyobbq 7y ago
If you click on Max, the chart indicates that the smart money expected the 10 yr inflation rate in late 2008 to be < .5%, which wasn't the case.
- JamesBarney 7y agoSo downward movement in that chart can be triggered by two things. The price of TIPS falling or the price of t-bonds rising. That was caused by the price of t-bonds jumping up due to a flight to safe money, much of that flight contractually obligated. So I don't think it was due to people honestly thinking the average inflation would be .5% but just an idiosyncrasy of how we estimate market expectations of inflation.