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Consol (bond)
Consols (originally short for consolidated annuities, but subsequently taken to mean consolidated stock) were government debt issues in the form of perpetual bonds, redeemable at the option of the government. They were issued by the Bank of England and the U.S. Government. The first British consols were issued in 1751. They have now been fully redeemed. The United States government issued consols from 1877 to 1930, which have likewise been redeemed. History In 1752 the Chancellor of the Exchequer and Prime Minister Sir Henry Pelham converted all outstanding issues of redeemable government stock into one bond, Consolidated 3.5% Annuities, in order to reduce the coupon (interest rate) paid on the government debt. In 1757, the annual interest rate on the stock was reduced to 3%, leaving the stock as consolidated 3% annuities. The coupon rate remained at 3% until 1888. In 1888, the Chancellor of the Exchequer, George Joachim Goschen, converted the consolidated 3% annuities, along ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Government Bond
A government bond or sovereign bond is a form of bond issued by a government to support public spending. It generally includes a commitment to pay periodic interest, called coupon payments'','' and to repay the face value on the maturity date. For example, a bondholder invests $20,000, called face value or principal, into a 10-year government bond with a 10% annual coupon; the government would pay the bondholder 10% interest each year and repay the $20,000 original face value at the date of maturity (i.e. after 10 years). Government bonds can be denominated in a foreign currency or the government's domestic currency. Countries with less stable economies tend to denominate their bonds in the currency of a country with a more stable economy (i.e. a hard currency). When governments with less stable economies issue bonds, there is a possibility they will be unable to repay bondholders, resulting in a default. All bonds carry a default risk. International credit rating agencie ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
