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'''Sovereign debt''' is a synonym for central/national government debt.
'''Sovereign debt''' is a synonym for central/national government debt.
Sovereign debt refers to debts incurred by a [[government]] through the issuance of bonds. Sales of government bonds are used as a means of managing a nation's [[money supply]], managing fluctuations in the [[value]] of a [[currency]] versus other foreign currencies, and as a means of generating [[revenue]] for the provision of government services. In the [[United States]] bonds are issued by the [[Federal Reserve]] in 2, 10 and 30 year intervals. The [[US Treausury]] also offer 90-day Treasury Bills (T-Bills) in $10,000 denominations.
Sovereign debt refers to debts incurred by a [[government]] through the issuance of bonds. Sales of government bonds are used as a means of managing a nation's [[money supply]], managing fluctuations in the [[value]] of a [[currency]] versus other foreign currencies, and as a means of generating [[revenue]] for the provision of government services. In the [[United States]] bonds are issued by the [[Federal Reserve]] in 2, 10 and 30 year intervals. The [[US Treasury]] also offer 90-day Treasury Bills (T-Bills) in $10,000 denominations.
In a bond auction bidders offer up bids for bonds that have a fixed value at maturity. Bond yields move inversely to prices. That means that if someone is purchasing a bond that has a fixed value of $100,000 at its date of maturity, the bond purchaser would offer a price for that bond, and the interest is calculated as the amount of accrued and compound interest represented by the increase of value over the life of the bond as it approaches its $100,000 face maturity value.
In a bond auction bidders offer up bids for bonds that have a fixed value at maturity. Bond yields move inversely to prices. That means that if someone is purchasing a bond that has a fixed value of $100,000 at its date of maturity, the bond purchaser would offer a price for that bond, and the interest is calculated as the amount of accrued and compound interest represented by the increase of value over the life of the bond as it approaches its $100,000 face maturity value.