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You are here: Home / Potpourri / Economics 101: Bonds

Economics 101: Bonds

Economics 101: Bonds

[This is part of the series: The Complete Guide To Economics 101.]

What are bonds?

Bonds are assets that give the buyer the legal right to future payments.

Depending on the type of bond, these payments can be fixed or variable, long-term or short-term, and payout in a number of different ways.

To make it more complicated, many bonds are traded on financial exchanges and yields are impacted by the reserve banks setting short-term interest rates.

They are another type of financial asset.

If it’s easier, just think of a bond as a complicated IOU certificate.

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Filed Under: PotpourriTagged With: #Economics101

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