The difference between public debt and national debt

1. Simply put, the biggest difference is that the national debt must be financed by the national central government, and the national debt is not necessarily the central government, but may be other local governments at all levels. Public debt is a loan taken by the government to solve the problem of account overdraft. National debt, also known as national debt, is a creditor-debtor relationship formed by the state issuing bonds to raise funds to the society based on its credit and in accordance with the general principles of bonds. Because the issuer of national debt is the country, it has the highest credit and is recognized as the safest investment tool.

2. Public debt: Public debt is a specific way for the government to obtain fiscal revenue according to the principle of confirmation, and it is a special financial activity. In contemporary countries, most laws stipulate that the government has the right to borrow money from individuals, enterprises, social organizations, financial institutions and other governments as debtors when necessary. Income in the form of loans is not only the debt income of the government, but also a debt of the government. When borrowing money, the government must pay interest and repay the principal to the creditors in the agreed way. Therefore, in the whole public debt activity, a stable creditor-debtor relationship has been formed between the government and public debt holders.

3. Generally speaking, this relationship is a voluntary transaction relationship between the two parties, which is completely different from the collection relationship formed by the government's compulsory and unpaid unilateral collection of taxpayers in taxation; National debt: National debt is sometimes called national debt. In countries where local governments are not allowed to borrow by law, these two concepts are consistent, that is, both refer to the central government borrowing. However, in countries where local governments are allowed to borrow, central government borrowing is generally called national debt, and local government borrowing can only be called national debt or local debt. Therefore, public debt = national debt and local debt (permitted by law).

4. The difference is that the issuer is different and the credit is different. Of course, national debt has the highest credit, but many corporate bonds are guaranteed by banks and companies, so don't worry about risks. Although the credit of corporate bonds is lower than that of national debt, its interest rate is not necessarily higher than that of national debt. Some corporate bonds, such as convertible bonds, have an annual interest rate of only 0.8%, which is similar to the deposit interest rate.

Corporate bonds refer to securities issued by the company in accordance with legal procedures and agreed to repay the principal and interest within a certain period of time. Corporate bonds are the manifestations of corporate bonds. Based on the issuance of corporate bonds, a legal relationship of creditor's rights and debts is formed between bondholders and issuers with the content of repaying principal and interest. Therefore, corporate bonds are debt certificates issued by companies to bondholders.