Offer your thoughts or opinion on the input financial query or topic using your financial background.

Why would anyone buy a government bond?
Why would a bank buy government bonds? Why couldn't they just deposit their money in another bank instead?  Generally, banks are limited by laws and regulations about how much they must set aside as reserves. Of the money they receive as deposits, they may loan a certain amount, but must keep some as a reserve (this is called "fractional reserve banking"). Different countries have a different amount that they must set aside in reserves.  In countries where bank deposits are guaranteed, there is almost always some upper limit to how much is guaranteed. The amount of money that a bank would deposit in another bank would be far greater than the guarantee.