A bond is a form of loan or IOU: the holder of the bond is the lender (creditor), the issuer of the bond is the borrower (debtor), and the coupon is the interest.
FOR THE BOND IS GIVEN THE MONEY.
FOR THE LENDER IS TO GIVE THE MONEY TO THE BORROWER.
FOR THE BORROWER IS TO GIVE THE BOND TO THE LENDER .
The bond is an instrument of indebtedness of the bond issuer to the holder.
ISSUE THE BOND does the BORROWER.
HOLDS THE BOND does the HOLDER.
BOND is a form of loan or IOU.
the holder of the bond is the lender (creditor).
the issuer of the bond is the borrower (debtor).
the coupon is the interest.
Bonds provide the borrower with external funds:
to finance long-term investments
to finance current expenditure
- Certificates-of-deposit (CDs) be money market instruments
- Short-term-commercial-paper be money-market-instruments
- The bond is an instrument-of-indebtedness
- the main difference is in the length of the term of the instrument.
Bonds and stocks are both securities, but the major difference between the two is that (capital) stockholders have an equity stake in a company (i.e., they are owners), whereas bondholders have a creditor stake in the company (i.e., they are lenders). Being a creditor, bondholders have priority over stockholders.
Consols government debt issues in the form of perpetual bonds, redeemable at the option of the government.
SECURED by tax upon the property of the persons