Perpetual Bonds

Click here to read a short article by Matthew Yglesias, which recommends that the US Treasury should issue perpetual bonds.  In other words, governments simply pay an annual coupon but never have to redeem the bond i.e., pay back the principal. This is not a new idea. Britain, from the 18th century onward, issued Consols, which were perpetual bonds paying a low coupon rate.

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