In 1963, James Tobin said:
"Markets do not provide, at any price, a riskless way of accumulating purchasing power for the future."
Fortunately, for investors in 2019, we can buy Treasury inflation-protected securities. I rarely see TIPS in prospective client portfolios and the next few posts explain why I frequently use them.
Inflation-indexed bonds fill an important gap in the fixed income market. Regular Treasury bonds are riskier than they seem - long-term Treasuries fell 60% in inflation-adjusted terms between 1940 and 1981. Minimizing duration is not a solution since real rates for short-term