TIPS Topping Out?

The speaker from Morningstar offers alternatives to treasury inflation protected securities, or TIPS.  These securities are treasury obligations, issued by the treasury through an auction.  These securities will adjust in value as the CPI adjusts over time. 

As inflation has moved much higher, TIPS have become very expensive, driving yields way lower and providing the investor with a negative rate of return in some cases.  The credit crisis "threw the baby out with the bathwater" and the speaker suggests that municipal bonds and mortgage backed securities have dropped in value significantly, thereby offer much more attractive yields.