The so-called national debt is a debt borrowed by the state, that is, a national bond. It is a written loan certificate issued by the state to investors to raise funds, promising to pay interest and interest on time according to agreed conditions within a certain period of time. The principal is returned upon maturity.

my country’s national debt specifically refers to the national public debt issued by the Ministry of Finance on behalf of the central government. It is guaranteed by the national fiscal reputation and has a very high credibility. It has always been known as “gilt-edged bonds”. Stable investors like to invest in national debt. . There are three types: voucher type, physical coupon type, and accounting type.

Specifically, it refers to the national debt formed by the government issuing bonds at home and abroad or borrowing from foreign governments and banks. It is an important part of the debt of the entire society. National debt is a special fiscal category. It is first of all a kind of financial income. The state's issuance of bonds or borrowings is actually to raise funds, thus having three major functions: making up for fiscal deficits, raising construction funds, and regulating the economy.

The issuance of government bonds must follow the credit principle of borrowing and repaying. When the bond or loan matures, not only the principal must be repaid, but also a certain amount of interest. The subscription of treasury bonds is voluntary. Except for a very small number of compulsory treasury bonds, people decide whether to subscribe and how much to subscribe.

Treasury debt can be divided into different types according to different standards: based on the form of state debt as the standard, national debt can be divided into state borrowing and bond issuance. Based on the maturity of financing and issuance, treasury bonds can be divided into long-term treasury bonds, short-term treasury bonds and medium-term treasury bonds. The so-called long, short and medium term are comparative and there is no absolute standard. Most countries in the world generally call short-term treasury bonds with a maturity of less than 10 years, long-term treasury bonds with a maturity of more than 10 years, and medium-term treasury bonds with a maturity between the two. Based on the nature of financing and issuance, treasury bonds can be divided into compulsory treasury bonds and free treasury bonds.

Based on the region where they are raised and issued, national debt can be divided into domestic debt and external debt. The so-called domestic debt refers to the country’s borrowings and bonds issued in its own country. The so-called foreign debt refers to a country’s borrowings from other governments, banks, and international financial organizations. Based on the liquidity of the bond, treasury bonds can be divided into marketable treasury bonds and unsaleable treasury bonds. The state's borrowings are not transferable; only bonds are sellable and unsaleable.

China's government bonds are called treasury bills, which specifically refer to the national public bonds issued by the Ministry of Finance on behalf of the central government and are guaranteed by the country's financial credibility. Compared with other bonds, its credibility is very high, and it is generally a bond that prudent investors like to invest in. There are three types: voucher type, physical coupon type, and accounting type.

Treasury bonds

Treasury bonds are issued by the government to guarantee the repayment of principal and interest, with low risk. They are called "gilt bonds" and have low cost, stronger liquidity and greater credibility. Advanced characteristics: When doing long and short positions in the treasury bond secondary market, what you do is only the difference between the treasury bond interest rate and the market interest rate, and the fluctuation range is very small.

Types of treasury bonds

There are many types of treasury bonds, which can be divided into three major types according to their bond form, namely: bearer (physical) treasury bonds, certificate-type treasury bonds and book-entry treasury bonds . Among them, bearer treasury bonds are no longer common, while the latter two are the main forms at present.

(1) Bearer (physical) treasury bonds

A bearer treasury bond is a bond that does not record the name of the creditor or the name of the company on its face. It usually appears in the form of a physical bond, also known as Physical or Treasury bills.

The bearer treasury bonds are the treasury bonds with the longest history of issuance in our country. Since the founding of the People's Republic of my country, the treasury bonds issued in the 1950s and since 1981 have mainly been bearer treasury bills.

When issued, it is publicly sold to the public through various bank savings outlets, the Treasury Bond Service Department of the financial department, and the business outlets of Treasury bond operating institutions. Investors can also use their securities accounts to entrust securities operating institutions to purchase them on the stock exchange. .

The cash redemption of bearer treasury bonds shall be handled by banks, postal system savings outlets and fiscal treasury bond intermediaries; or redemption shall be carried out on-site at trading venues.

The general characteristics of bearer treasury bills are: they are bearer, cannot be reported as lost, and can be listed and circulated. Since they are anonymous and cannot be reported as lost, their holding security is not as good as certificate-type and account-based treasury bills, but the purchase procedure is simple. Because it can be listed and transferred, it has strong liquidity. The listing transfer price depends on the supply and demand situation in the secondary market. When market factors change, the price will fluctuate greatly. Therefore, there is an opportunity to obtain greater profits, but it is also accompanied by certain risks. Generally speaking, bearer Treasury bills are more suitable for financial institutions and buyers with strong investment awareness.

(2) Certificated treasury bonds

Certified treasury bonds refer to treasury bonds issued by the state by filling out "treasury bill collection certificates" instead of printing physical bonds. my country began to issue certificate-type treasury bonds in 1994. The face form of certificate-type treasury bonds is similar to bank time deposit certificates, and the interest rate is usually higher than the bank deposit interest rate for the same period. It has characteristics similar to but better than savings. It is often called "savings-type treasury bonds" and is a personal investment for the purpose of savings. ideal investment method.

Certificate-style treasury bonds are issued to the public through various bank savings outlets and the treasury bond service department of the financial department. They are mainly for ordinary people. Interest accrues from the date of purchase by investors. They can be registered and reported as lost, but they cannot be listed and circulated. .