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What is government security?

Authors
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    Name
    Benton Li
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Well it ensures government safety. Examples include the FBI, CIA

Government securities are securities issued by the government, usually in the form of bonds. Examples include T-Bills, Gilts, and German Bunds.

They are also known as govies.

Usually, bonds are backed by collaterals. Govies’ collaterals are government credits, which are in the form of national strength: a booming economy, political stability, power to tax rob and print money, etc.

Govies’ features:

  • Safe
  • Liquid asf
  • Almost risk-free

The idea is that, if US Government goes bankrupt, what else assets are considered low-risk?

Usually, municipal bonds or bonds issued by state-run corporates (agency securities) are not considered government securities as they have different credit and thus different risks.

Is the US dollar a zero-coupon govie too? Don’t let that sink in, it will keep you up at night.