4. Citing the tremendous supply of TIPS, the illiquidity of TIPS, and the substantial exposure that TIPS have to changes in real interest rates, Lucas and Quek suggest that a part of (or the entire) “inflation-risk premium” may be offset. See Gerald Lucas and Timothy Quek, “Valuing and Trading TIPS,” Chapter 9 in John Brynjolfsson and Frank J. Fabozzi (eds.), Handbook of Inflation Indexed Bonds (New Hope, PA: Frank J. Fabozzi Associates, 1999). For a more detailed discussion of implied break-evens and risk-premiums, see the seminal work on expectations and markets by M. Harrison and D. Kreps, “Martingales and Multiperiod Securities Markets,” Journal of Economic Theory (1979), pp. 381–408.