TIPS (Real Rates) NEGATIVE REAL RATES: Is that really possible?

Currently, Treasury Inflation Protected Securities (TIPS) have negative yields. TIPS are bonds whose face value increases by the amount of inflation. So the yield on TIPS measures the "real interest rate" which is the interest rate that would be charged in a world where these is no inflation. How can this yield be negative? This interactive chart shows you the current trends in real rates:

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INFLATION EXPECTATIONS: Inflation Fears Hype versus Reality?

Inflation fears and financial market reactions have recently become a daily event. Headlines such as “Inflation fears: what do interest rates tell us?” “China’s inflation accelerates …” and “UK Inflation soars 4% ...” Headlines are designed to grab attention but the real question is what are inflation expectation numbers revealing right now?

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