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Hello All,

I just finished reading the book "Worry Free Investing" by Bodie & Clowes. I had a question regarding TIPS. I was looking on Treasurydirect.gov and noticed that recent TIPS auctions have yielded around 4.75% or so. Is this going to be the fixed rate that is paid above the increase/decrease in the CPI? So if inflation is 3%, is the TIPS going to yield 7.75%? Also, as far as taxes on TIPS, am I correct in thinking the the full amount is taxable (even the CPI adjustment)? Thank you.

Cameron
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