[The once and future king]

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DcifrThs

You havnt answered my question. Tips might have compensated you enough to cover purchasing power in relation to the basket of stuff (consumer goods), but I cant see how over the period in question it would have compensated you for the loss of purchasing power against a basket of assets.

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i gotcha. i misunderstood what you were saying and concentrated much more on the market action.

TIPS don't cover the "basket of assets" as you know and pointed out so they wouldn't have covered your exposure to, say, milk.

if you consume the basket of goods though, you'd be covered, at least in some way. the market though would still react to the inflation expectations vs. historical realized infaltion.

Barron

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Yea, what I am trying to get at is that Bonds etc are sensitive in the main to basket of stuff inflation, but are less sensitive to basket of assets inflation.

So if you have a massive increase of liquidity/money supply etc, but that all gets channeled into asset inflation but not the basket of stuff inflation (As is the case in the period under discussion), you wont be able to reverse engineer the conclusion that there had been a massive increase in the money supply (inflation) by looking at movements in the bond market.