Investors are increasingly bearish on inflation-protected Treasuries: Short interest on the TIPS ETF, TIP, is up to ~6% of shares outstanding, triple the levels seen in late 2025. The fund tracks an index of inflation-protected Treasury bonds, whose prices generally fall when real yields rise. This figure is now in-line with the highest levels recorded in December 2021, just 3 months before the Fed started hiking rates. Short interest on TIP peaked at ~8% in Q2 but has remained above 4% for the majority of the year. Investors are more aggressively betting against TIP prices as strong economic growth, rising fiscal concerns, and debt-fueled AI infrastructure investment have led investors to demand higher yields on Treasuries. Real Treasury yields are gaining momentum.(The Kobeissi Letter)