Seeking Alpha Seeking Alpha Portfolio App for iPad About a year
ago I suggested that investors concerned about inflation should
put some savings into Treasury Inflation Protected Securities
[TIPS].  Since that time the overall TIPS market’s performance
can be considered fair, at best. If we use the iShares TIPS ETF
(TIP), which invests in all outstanding TIPS securities that
have at least one year until maturity as a proxy for the market,
the total return has been 1.73 percent for the past year.
Looking at the Fund more closely we see that the price fell
about 3.2 percent; while interest payments countered this fall
by adding 4.93 percent; resulting in an overall return of 1.73
percent. For comparison, in the same period, a Vanguard bond
fund which tracks regular US government bonds of similar
maturities returned about 3.55 percent.  Let’s briefly review
TIPS before discussing today’s market in more detail.  The U.S.
Treasury started issuing TIPS in 1997 to create a way for
investors to own government debt s