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The Complete Idiot's Guide to Economics, 2nd Edition by Tom Gorman

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High Sovereign Debt

Debt issued by national governments (as opposed to state, provincial, and local governments) is called sovereign debt. Because those debt instruments, usually called notes and bonds, are backed by the taxing power of the national government, they are generally viewed as safe investments. However, some economies (and governments) are safer investments than others. U.S. securities are generally viewed as risk-free, at least in terms of default (usually defined as missed payments or nonpayment). Inflation risk is a reality, but that is a risk of investing in almost any security.
The United States and a number of EU governments took on huge amounts of debt to stimulate their economies during and after the 2008-2009 recession. ...

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