Jim Eager

TIPS: Nominal Yield, Risky Real After-Tax Return

Sir,
The points made are interesting. However, TIPS are a very small proportion of US government debt. The relative disadvantages for taxed investors are unlikely to reduce demand enough to make taxed investors the marginal pricer.

I'm too lazy to get the data, but the Fed has owner-information. I'm willing to bet there are few holdings among (directly) taxed investors.