Good short article series on TIPS and correction to a major misperception

[Kbg]

In investments and trading I find data way more compelling than my opinions and far more accurate. I also look for things to challenge my existing investing beliefs. I find it very helpful and profitable. Mr. Market doesn’t give a crap about my belief system. My job is to figure out how I can get Mr. Market to give me the most money with the least risk.

Hating/distrusting a treasury bill or TIPS is like hating/distrusting a screwdriver and a saw. Ditto for loving gold. They’re tools, they do things, end of story.

[mathjak107]

Gotta agree with mathjak on this one. The basic idea behind TIPS is using a government promise to protect you from the fact that they broke their first promise (maintaining gold/silver as money). That's absurd. It's like trusting your spouse's promise to not hit you again. That kind of shit doesn't show up in a spreadsheet.

I disagree. Kbg has already explained the mechanics of TIPS which aside from the inflation adjustment are no different from any other Treasury bond. The government paranoia stuff and references to the old gold standard are exactly why folks outside these forums thing we’re all eating MRE’s in a bunker while fondling our gold bullion and AR-15’s.

I’m not assuaged. It’s not like I trust the creditworthiness of normal treasury bonds either. I mean, if I were, I wouldn’t be using the PP to begin with.

our treasury bonds have never defaulted and markets still control the rates ...the gov't has already lied to us when we had high inflation . so actions speak louder than the data those who lie produce