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Economics

Bonds (Financial)

Quick fact

The global bond market is over $100 trillion in size, dwarfing the stock market. Most bonds are traded over-the-counter, not on public exchanges like stocks.

Why this is interesting

You probably know about borrowing money from a bank. But what if a government needs billions to build a bridge? Instead of a single loan, it issues bonds—thousands of small loans to investors. Why would anyone lend money to a government or company through a bond?