Here are results of my short-term TIPS experiment

Posted on January 24, 2024 by Tipswatch

Did it work out well? Yes. But is it worth the risks?

By David Enna, Tipswatch.com

For a few years now, I’ve been getting questions about seemingly lavish high real yields on Treasury Inflation-Protected Securities that are nearing maturity. My usual response is that these real yields — while technically accurate — get exaggerated as maturity nears and only one coupon payment remains.

See this from Sept. 2, 2022: “What’s up with those crazy real yields on ultra-short-term TIPS?“

For example, in late August 2023 readers spotted this TIPS, CUSIP 912828B25, maturing Jan 15 2024, just 4 1/2 months later.

Its quoted real yield was 4.080%, and at the time U.S. inflation was running at 3.7%, so some readers extrapolated a gorgeous return of 7.7% on this TIPS, in just 4 1/2 months. At the time, a 17-week T-bill was yielding about 5.5%.

But that isn’t the way it works. Only 4 1/2 months of inflation accruals remained so the end result for the TIPS was highly likely to be somewhere close to the 17-week T-bill, I figured. Time for an experiment! My thinking: I could get a better understanding of these short-term TIPS by investing in one.

My mind game resulted in this Sept. 3, 2023, article: “Experiment: Let’s try out a very short-term TIPS“.

The investment

To test the theory, on Aug. 30, 2023, I purchased $12,000 par of CUSIP 912828B25 on the secondary market at a real yield of 4.07% and a price of 98.73437. Because this TIPS had a high inflation index of 1.30749, the investment cost me $15,491.30 after the price discount, plus $12.52 in accrued interest.

Because this purchase was starting out with principal of $15,689.88, I was getting an immediate gain of 1.28%, plus I knew I would get 0.3125% interest at final maturity, for a total of 1.59%, which translates to an annual return of about 4.2% before any inflation accruals.

And there was the key to this whole investment: How much non-seasonally adjusted inflation (or very possibly, deflation) would we see before the January 15, 2024, maturity? Inflation accruals for TIPS are set by non-seasonally adjusted inflation two months earlier. So I already knew one month of accruals, for September:

  • September: accruals of 0.19%, based on July inflation.
  • October: ???, ended up being 0.44% based on August inflation
  • November: ???, ended up being 0.25% based on September inflation
  • December: ???, ended up being -0.04% based on October deflation
  • January: ???, ended up being -0.10% based on half of November deflation

In this case, the first three months added 0.88% to my principal and things were looking good. But the next 1 1/2 months subtracted 0.14% from my principal. I expected this to happen, because non-seasonally adjusted inflation often goes negative in November and December.

Verdict: This time, it worked.

My goal was to use this investment maturing Jan. 15, 2024, to help fund my next TIPS purchase … the new 10-year TIPS that was auctioned last week with a real yield of 1.81%. Would I end up doing better buying this TIPS, or just investing in the 17-week Treasury that would mature on Jan. 2, 2024?

Here is the result:

I adjusted the investment totals to come up with a similar ending number around $15,850. The TIPS ended up being the winner in this contest, with a nominal annualized yield of 6.21% versus 5.52% for the 17-week T-bill. That’s 69-basis-point bonus, but in actual dollars it amounts to about $75, or about one-third the cost of one trip to Costco.

This TIPS had an ending inflation index of 1.31741, 0.759% higher than the starting index of 1.30749. That is annualized inflation of about 2.02%. And remember, I figured with the final coupon payment the annualized nominal yield would be 4.2% before inflation or deflation. The actual return was 6.21%. Do the math: 4.2% + 2.02% = 6.22%, so you can see roughly how the real yield actually topped 4.0%, as advertised.

Final point: Is it worth it?

Any time you buy a TIPS with just a few months to maturity, you will be highly likely to be buying a large amount of additional principal that is not guaranteed to be returned at maturity. In this case, I was buying 30.7% extra principal at a cost of about $3,504. If deflation had struck in August and September, I would have gotten a lousy return versus the 17-week T-bill.

Deflation is more of a risk in the short-term (especially nearing the end the year) than the long term. In the future, I would be a lot more likely to buy the 17-week T-bill, which involves zero risk and a certain return at maturity.

• Confused by TIPS? Read my Q&A on TIPS

• TIPS in depth: Understand the language

• TIPS on the secondary market: Things to consider

• Upcoming schedule of TIPS auctions

* * *

Feel free to post comments or questions below. If it is your first-ever comment, it will have to wait for moderation. After that, your comments will automatically appear.Please stay on topic and avoid political tirades.

David Enna is a financial journalist, not a financial adviser. He is not selling or profiting from any investment discussed. I Bonds and TIPS are not “get rich” investments; they are best used for capital preservation and inflation protection. They can be purchased through the Treasury or other providers without fees, commissions or carrying charges. Please do your own research before investing.

Posted in Cash alternatives, Inflation, Investing in TIPS, Treasury Bills, TreasuryDirect | 18 Comments

A 10-year TIPS matured Jan. 15. How did it do as an investment?

Posted on January 21, 2024 by Tipswatch

By David Enna, Tipswatch.com

Back on Jan. 23, 2014, the Treasury auctioned a new 10-year TIPS, CUSIP 912828B25, generating a real yield to maturity of 0.661% and a coupon rate of 0.625%.

That doesn’t seem exciting, but at the time this was a promising result, coming in the wake of nearly three years of aggressive quantitative easing by the Federal Reserve. The auction result of 0.661% was the highest real yield at auction for any 9- or 10-year TIPS in nearly three years.

In my preview article for the auction, I noted that real yields had slipped a bit from 2013 highs, but this new TIPS still looked attractive. At the time, however, I wasn’t a buyer. (I did buy this TIPS much later; more on that coming up.) My only TIPS purchase in 2014 came in the October reopening of the July 10-year, CUSIP 912828WU0, with a real yield of 0.601%.

So how did CUSIP 912828B25 do as an investment? Pretty well, actually, when measured against the 10-year Treasury note available at the time, with a nominal yield of 2.78%.

The new TIPS had an inflation breakeven rate of 2.12%, meaning it would outperform the nominal Treasury if inflation averaged more than 2.12% over the next 10 years. The result: Annual inflation averaged 2.8% over that decade, making CUSIP 912828B25 a winner, by a large margin of 68 basis points a year.

The Eyebonds.info summary page for this TIPS shows that it generated a nominal annual return of 3.445%, well above the nominal Treasury’s 2.78%.

The lesson here is that even a mundane real yield of 0.661% can be a good investment if inflation trends work in the investment’s favor.

Catching the inflation wave

I’ve been tracking results for 5- and 10-year TIPS for a long time. For many years, the news wasn’t great. We recently completed a decade-long period of inflation running at less than 2.0%, causing TIPS to do poorly versus nominal Treasurys. Then in 2021 we entered an era of much higher inflation, and so TIPS maturing recently have done well, getting a big boost from inflation in the last three years.

For more information, see my TIPS vs. Nominals page.

To view this chart at a glance, the annual variance number in the last column shows how the inflation breakeven rate compared to actual 10-year annual inflation. When the numbers are green, a TIPS was the superior investment. When they are red, the nominal Treasury was the better investment.

The next decade could be entirely different. Never predict the future decade based on the performance of the past decade.

My later purchase of CUSIP 912828B25

Because I was getting a lot of questions about the lavishly high real yields you often see on short-term TIPS, I decided to do a 4 1/2-month experiment to see how CUSIP 912828B25 would perform versus a 17-week Treasury. You can read the details here: “Experiment: Let’s try out a very short-term TIPS“.

I will be posting an article Wednesday morning revealing the result of the experiment. Here is the link.

Notes and qualifications

My TIPS vs. Nominals chart is an estimate of performance.

Keep in mind that interest on a nominal Treasury and the TIPS coupon rate is paid out as current-year income and not reinvested. So in the case of a nominal Treasury, the interest earned could be reinvested elsewhere, which would potentially boost the gain. For certain, we don’t know what the investor could have earned precisely on an investment after re-investments.

In the case of a TIPS, the inflation adjustment compounds over time, and that will give TIPS a slight boost in return that isn’t reflected in the “average inflation” numbers presented in the chart.

• Confused by TIPS? Read my Q&A on TIPS

• TIPS in depth: Understand the language

• TIPS on the secondary market: Things to consider

• Upcoming schedule of TIPS auctions

* * *

Feel free to post comments or questions below. If it is your first-ever comment, it will have to wait for moderation. After that, your comments will automatically appear.Please stay on topic and avoid political tirades.

David Enna is a financial journalist, not a financial adviser. He is not selling or profiting from any investment discussed. I Bonds and TIPS are not “get rich” investments; they are best used for capital preservation and inflation protection. They can be purchased through the Treasury or other providers without fees, commissions or carrying charges. Please do your own research before investing.

Posted in Inflation, Investing in TIPS, Treasury Bills | 8 Comments

10-year TIPS auction gets real yield of 1.810%, an attractive result

Posted on January 18, 2024 by Tipswatch

By David Enna, Tipswatch.com

That worked out well. A bit of jawboning earlier this week by Federal Reserve governor Christopher Waller sent both real and nominal yields climbing in the days ahead of the Treasury’s $18 billion offering of a new 10-year TIPS, CUSIP 91282CJY8.

Today’s auction result was good for investors: A real yield to maturity of 1.810% (the third highest auctioned yield since July 2009) and a coupon rate of 1.75% (the highest at auction for this term since April 2009).

At $18 billion, this was the highest amount ever offered for a new 10-year Treasury Inflation-Protected Security, and yet demand looked strong. The auction got a bid-to-cover ratio of 2.62, the highest for this term in three years. And the real yield to maturity of 1.810% was actually slightly below the “when-issued” prediction of 1.825%.

Waller, the Fed governor, said Tuesday he saw “no reason to move as quickly or cut (interest rates) as rapidly as in the past.” That shook up the bond market, pushing real yields up about 10 basis points in two days. Yield expectations for this auction rose from about 1.69% on Friday to 1.80% leading into Thursday’s result.

Definition: A TIPS is an investment that pays a coupon rate well below that of other Treasury investments of the same term. But with a TIPS, the principal balance adjusts each month (usually up, but sometimes down) to match the current U.S. inflation rate. So, the “real yield to maturity” of a TIPS indicates how much an investor will earn above inflation each year until maturity.

Here is the trend in the 10-year real yield over the last two years, showing that a recent downward trend has reversed this week:

Click on image for larger version.

Pricing

Based on the auctioned real yield of 1.810%, the Treasury set the coupon rate for this TIPS at 1.75% and investors therefore got it at a discounted price. In addition, the new TIPS will have an inflation index of 0.99896 on the settlement date of Jan. 31.

Here is how the pricing would work out for a $10,000 purchase:

  • Par value: $10,000
  • Inflation index at settlement date: 0.99896
  • Principal purchased at settlement date: $9,989.60
  • Unadjusted price: 99.454975
  • Cost of investment: $9,989.60 x 0.99454975 = $9,935.15
  • Plus accrued interest of about $7.68.

In summary, an investor purchasing $10,000 par of this TIPS will pay $9,935.15 for $9,989.60 of principal and will then receive inflation accruals and an annual coupon rate of 1.75% on adjusted principal for the next 10 years.

Inflation breakeven rate

At the auction’s close, a 10-year nominal Treasury note was trading with a yield of 4.15%, creating an inflation breakeven rate of 2.34% for this new TIPS. It means the TIPS will outperform the nominal Treasury if inflation averages more than 2.34% over the next 10 years. This rate, while historically a bit higher, is in line with other recent auctions of this term.

Over the last 10 years, U.S. inflation has averaged 2.8%. Here is the trend in the 10-year inflation breakeven rate over the last two years, showing how inflation expectations have drifted lower in reaction to Federal Reserve tightening:

Click on image for larger version.

Reaction to the auction

I set my focus set on this auction for several months because this is the first TIPS maturing in 2034 and fills a spot on my investment ladder. I am pleased with the result. Just a few days ago, I didn’t expect to get a coupon rate above 1.625%.

The TIP ETF, which holds the full range of maturities, nudged slightly higher after the auction’s close, which indicates the bond market was pleased. (Remember that the “when-issued” yield prediction was slightly higher, so demand was strong.) The bid-to-cover ratio of 2.62 reinforces that impression.

So we get a good result from the first TIPS auction of the year. Coming next month is the Feb. 22 auction of a new 30-year TIPS. Although I won’t be a buyer, the recent steepening of the yield curve could make this attractive for investors who can withstand both the term and volatility.

Then, on March 21, today’s 10-year TIPS will be reopened at auction.

Here is a history of recent 9- to 10-year TIPS auctions. Note that just a bit more than two years ago, a November 2021 reopening auction set the record for the lowest real yield in history for this term, -1.145%. Today’s auction was 295 basis-points higher. Cheers!

• Confused by TIPS? Read my Q&A on TIPS

• TIPS in depth: Understand the language

• TIPS on the secondary market: Things to consider

• Upcoming schedule of TIPS auctions

* * *

Feel free to post comments or questions below. If it is your first-ever comment, it will have to wait for moderation. After that, your comments will automatically appear.Please stay on topic and avoid political tirades.

David Enna is a financial journalist, not a financial adviser. He is not selling or profiting from any investment discussed. I Bonds and TIPS are not “get rich” investments; they are best used for capital preservation and inflation protection. They can be purchased through the Treasury or other providers without fees, commissions or carrying charges. Please do your own research before investing

Posted in Federal Reserve, Inflation, Investing in TIPS | Tagged , , , , | 22 Comments

Thursday’s 10-year TIPS auction: Is it a must buy?

Posted on January 14, 2024 by Tipswatch

By David Enna, Tipswatch.com

Here’s a strange fact: Despite the surge higher in 10-year real yields over the last 16 months, no new-issue TIPS of this term has received a coupon rate of 1.50% or higher since July 2009. That’s true even though daily 10-year real yields crossed the 1.50% threshold in September 2022 and hit a peak of 2.52% on Oct. 25, 2023.

It is just the way the January and July auctions have turned out for this 10-year term. In January 2023, real yields dipped to about 1.22% (the auction got a coupon rate of 1.125%) and then in July 2023, down to 1.49% (the auction got a coupon rate of 1.375%).

This trend might be broken Thursday, when the Treasury auctions a new 10-year TIPS, CUSIP 91282CJY8. The real yield to maturity and coupon rate will be determined by the auction results.

Definition: A TIPS is an investment that pays a coupon rate well below that of other Treasury investments of the same term. But with a TIPS, the principal balance adjusts each month (usually up, but sometimes down) to match the current U.S. inflation rate. So, the “real yield to maturity” of a TIPS indicates how much an investor will earn above inflation each year until maturity.

Some thoughts about CUSIP 91282CJY8:

  • This will be the only TIPS — up to this point — maturing in 2034. A second will be created in the July 2024 auction of another new 10-year TIPS.
  • The Treasury set the auction size at $18 billion, the largest in the 26-year history of 10-year TIPS. Will the market comfortably soak up that additional supply? The Treasury seems at least a little concerned, based on a recent Reuters report.
  • This TIPS will have an inflation index of 0.99896 on the settlement date of Jan. 31 because of slightly negative non-seasonally adjusted inflation in November. Principal balances will also decline 0.1% in February, based on December inflation. Big money investors will be adjusting their bids based on these facts.

Real yields have been volatile over the last week, but at this point the Treasury’s estimate for a full-term 10-year TIPS is a real yield of 1.69%, down 14 basis points in a week. The most recent 10-year TIPS trading on the secondary market closed Friday at 1.66%.

It’s impossible to say where we are heading into next week. Tensions are building yet again in the Middle East. China isn’t happy with Taiwan’s election. The U.S. Congress may sink toward another government shutdown, while deficits continue surging higher. Plus, markets are closed Monday for the Martin Luther King Jr holiday.

The result is volatility, but we are used to that.

So let’s assume that this TIPS gets an auctioned real yield of 1.69%. That would be the 3rd highest real yield for this term since April 2010, but well below recent reopening auctions of this term: 2.094% in September 2023 and 2.180% in November 2023. The coupon rate would be set at 1.625%.

Exciting? Not really. Disappointing? No. It is what it is, a historically attractive real yield for a 10-year TIPS. Here is the trend in the 10-year real yield over the last 15 years:

Click on image for a larger version.

Pricing

Because this is a new TIPS, the coupon rate will be set to the nearest 1/8th percentage point below the auctioned real yield. That means the TIPS will have an unadjusted price below 100. Add in the fact that the inflation index will be 0.99896 on the settlement date, and you have a near guarantee that this TIPS will auction with an adjusted price below par value of 100. The only unknown factor is a small amount of accrued interest based on the as-yet-undetermined coupon rate.

What does this mean? If you are placing an order for this TIPS at auction, you can be fairly certain your cost will be very close to or below par value. That makes things easy. If you want $10,000 par, the price should be right around $10,000, either at TreasuryDirect or any brokerage that doesn’t charge a commission.

Inflation breakeven rate

With the Treasury estimating the yield on a 10-year nominal Treasury note at 3.96% on Friday, CUSIP 91282CJY8 currently would have an inflation breakeven rate of 2.27%, which aligns closely with recent auctions of this term. This looks very reasonable to me. Here is the trend in the 10-year inflation breakeven rate over the last 15 years:

Click on image for a larger version.

From this chart, which shows recessions in shading, you can see that the inflation breakeven rate drops drastically when economic distress strikes. Those are opportune times for investing in TIPS, at least versus a nominal Treasury. As those times worsen, the Treasury generally steps in with quantitative easing, and TIPS investments benefit.

Right now we are in more of a neutral zone. The Fed is still doing quantitative tightening, which means it is lowering its $4.7 trillion balance sheet of Treasurys. But there have been indications QT could end this year. If that happens, TIPS yields could decline along with nominal yields.

Is this TIPS a ‘must buy’?

Although I am planning to buy a sizable investment Thursday, I wouldn’t call this auction a must buy. That will depend on something we can’t know: the future. 1) If you think real yields will be heading steadily lower in 2024, then buy at this auction. 2) If you want to fill a 2034 slot on your TIPS ladder for an investment that will be held to maturity, then buy at this auction. (Or soon after on the secondary market.)

But if you think real yields will be in flux through the year, then you will have plenty of opportunities to buy on the secondary market or at two more reopening auctions for this TIPS (in March and May) and then a new TIPS in July and two more reopenings later in the year.

However, keep in mind that finding CUSIP 91282CJY8 on the secondary market in small lot sizes could be difficult for a few weeks, even more than month.

I Bonds vs. TIPS?

The U.S. Series I Savings Bond currently has a permanent fixed rate of 1.3% for purchases through April. It appears CUSIP 91282CJY8 will have about a 39-basis-point advantage, which I think makes this competition a toss up. I Bonds have a lot of advantages over TIPS, but purchases are limited to $10,000 per person per year unless you use your tax return to get paper I Bonds or add to your holdings through the gift-box strategy or trusts.

As things stand, I definitely plan to buy I Bonds up to the limit this year, very probably in April. After that, I will strategically add to my TIPS holdings. The two investments are compatible — I Bonds for future cash needs and TIPS for defined inflation-protected payouts in future years.

What’s next?

This TIPS auction closes Thursday at 1 p.m. EST. Non-competitive bids at TreasuryDirect must be placed by noon Thursday. If you are putting an order in through a brokerage, make sure to place your order Wednesday or very early Thursday, because brokers cut off auction orders before the noon deadline.

You can track the Treasury’s daily yield estimate after the market close each day on its Real Yields Curve page. But remember that the bond market is closed Monday. I hope to post the results soon after the auction closes on Thursday.

Meanwhile, here is a history of the last five years of auctions of this term:

• Confused by TIPS? Read my Q&A on TIPS

• TIPS in depth: Understand the language

• TIPS on the secondary market: Things to consider

• Upcoming schedule of TIPS auctions

* * *

Feel free to post comments or questions below. If it is your first-ever comment, it will have to wait for moderation. After that, your comments will automatically appear. Please stay on topic and avoid political tirades.

David Enna is a financial journalist, not a financial adviser. He is not selling or profiting from any investment discussed. I Bonds and TIPS are not “get rich” investments; they are best used for capital preservation and inflation protection. They can be purchased through the Treasury or other providers without fees, commissions or carrying charges. Please do your own research before investing.

Posted in Federal Reserve, I Bond, Investing in TIPS, TreasuryDirect | 34 Comments

December inflation gets an upside surprise; annual rate rises to 3.4%

Posted on January 11, 2024 by Tipswatch

By David Enna, Tipswatch.com

One hour after I was reading a Bloomberg report on inflation steadily easing in future months, the Bureau of Labor Statistics sent out a December surprise: Seasonally-adjusted inflation rose rose 0.3% for the month and 3.4% for the year.

Both those numbers were higher than expectations, and the same was true for core inflation, which removes food and energy. For the month, core inflation also rose 0.3% and ended 2024 at 3.9%.

This should be a bit of a shock to the U.S. stock market, which recently seems to have been celebrating the return of U.S. inflation to the Federal Reserve’s target of 2.0%. But the December report sent a different message: Inflation isn’t quite tamed yet.

This report sets the official 2023 U.S. inflation rate at 3.4%, down dramatically from the 6.5% of 2022 and 7.0% of 2020. But before that, inflation had not reached this level since 2005.

The BLS noted that shelter again was the key cause of higher inflation, with costs rising 0.5% for the month and 6.2% over the last year, and accounting for more than half of the all-items increase. More from the report:

  • Gasoline prices crept 0.2% higher for the month but were down 1.9% for the year.
  • The costs of food at home rose 0.1% and were up a moderate 1.3% for the year.
  • The index for meats, poultry, fish, and eggs rose 0.5% in December, led by an 8.9% increase in the index for eggs.
  • Electricity costs rose a sharp 1.3% for the month and were up 3.3% for the year
  • Costs of used cars and trucks rose 0.5% in December but were down 1.3% for the year.
  • New vehicle costs rose 0.3% for the month and 1.0% for the year.
  • The motor vehicle insurance index rose 1.5% in December and was up a whopping 20.3% in 2023.
  • Costs of transportation services rose 0.1% for the month but were up 9.7% for the year.
  • The index for rent rose 0.4% for the month and 6.5% for the year.

Here is the trend in 2023 for all-items and core inflation, showing that core inflation has been inching steadily lower, while all-items costs have fluctuated:

What this means for TIPS and I Bonds

Investors in Treasury Inflation-Protected Securities and U.S. Series I Savings Bonds are also interested in non-seasonally adjusted inflation, which is used to adjust principal balances on TIPS and set future interest rates on I Bonds. For the month of December, the BLS set the inflation index at 306.746, a decrease of 0.10% from the November number.

Why was official inflation 0.3% and non-seasonal -0.10%? Keep in mind that seasonal and non-seasonal inflation balance out over the year and non-seasonal inflation tends to run lower from July to December and then higher from January to June. So expect a reverse of this trend beginning next month.

For TIPS. The December report means that principal balances for all TIPS will decline by 0.10% in February, after falling 0.20% in January. Here are the new February Inflation Indexes for all TIPS.

For I Bonds. The December report is the third in a six-month string that will determine the I Bond’s new variable rate, which will be reset on May 1 and eventually take effect for all I Bonds. So far, through three months, inflation has decreased 0.34%. The next three months are highly likely to reverse that negative number, but I would expect the end result to be less than 1.0%, which would result in a new variable rate around 1.72% for six months. Could it be higher? Maybe. Could also be lower. Lots can happen over the next three months.

As I have noted before, long-term I Bond investors should focus on the fixed rate, which is currently 1.3% for any purchase through April. The fixed rate is permanent and is historically attractive right now.

Here are the relevant numbers so far:

See historical data on my Inflation and I Bonds page

What this means for future interest rates

I’d expect some turmoil in the Treasury market today, with yields rising higher. This inflation report was higher than expectations across the board. The report certainly should reinforce the Federal Reserve’s determination to hold interest rates steady until inflation shows signs of abating. But it probably won’t mean much in the long run: The Fed has signaled three short-term rate cuts in 2024 and I’d expect that to happen.

From a Bloomberg report this morning:

“Inflationary pressures, while generally inching lower, remain stubbornly higher than expectations as the so-called ‘last mile’ requires more time to reach the final goal. The last Fed minutes underscored that the path towards price stability remains uncertain, and today’s CPI report suggests that the Fed’s initial rate cut may be later than the market is hoping for.”

Quincy Krosby, chief global strategist at LPL Financial

“Today’s inflation report reinforces the notion that the market had gotten a little overexcited around the timing of rate cuts. These are not bad numbers, but they do show that disinflation progress is still slow and unlikely to be a straight line down to 2%.”

Seema Shah, chief global strategist at Principal Asset Management

So it is possible that we won’t see a rate cut from the Federal Reserve in March, as many had anticipated. Figure June, instead?

This December inflation report should hold real yields around current levels through the Jan. 18 auction of a new 10-year TIPS. I will be posting a preview article about that auction on Sunday morning.

* * *

Feel free to post comments or questions below. If it is your first-ever comment, it will have to wait for moderation. After that, your comments will automatically appear. Please stay on topic and avoid political tirades.

David Enna is a financial journalist, not a financial adviser. He is not selling or profiting from any investment discussed. I Bonds and TIPS are not “get rich” investments; they are best used for capital preservation and inflation protection. They can be purchased through the Treasury or other providers without fees, commissions or carrying charges. Please do your own research before investing.

Posted in Federal Reserve, I Bond, Inflation, Investing in TIPS, Savings Bond | 23 Comments