Inflation and Godot

While many are nervous the massively stimulative monetary policy engineered by the Fed will inevitably trigger inflation, those folks are waiting for Godot. Subtracting the current yield on a 10-year Treasury Inflation Protected Securities (TIPS) bond (-0.637%) from the current yield on a regular 10-year Treasury bond (1.52%) gets us 2.157%. This means headline inflation over the next decade in expected to average just over 2%. Worry about something else!