Was playing Red Dead 2 and the gang comes into some Bonds. Apparently they’re worth money but idk how the gang gets a profit from it, or how bonds work in civilian life.
In: Economics
Bonds used to be sheets of paper that said that the holder of this bond (or technically, the bearer of the bond) would be due regular interest. On the outside of the bond were small coupons with dates printed on them that the bond bearer would tear off and bring to a bank to get cash. Once all the coupons were turned in over the period of the loan, the big sheet would then be brought back to the bank and the original loan amount would then be returned.
So you might have a bond for 100 dollars, and you might have fourty coupons each for 1 dollar. Once every quarter for ten years you’d get a dollar and at the end of the time you would get your 100 bucks back. Now, it didn’t matter who bought the loan, it mattered who bore the bond. They didn’t have a way to know if someone legitimately purchased that bond from someone else or it was stolen, so locking up your bearer bonds was very important.
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