A government is simply the governing system or group of individuals governing a nation, usually a state. In some nations there is separate government for the country as a whole and for the local government. In most nations there is centralized government represented by the central government. There are various types of government.
Monarchy is often considered to be one of the oldest forms of government in the world. Many nations throughout history have had various kings and other political leaders assume control of the country. Although a true democracy, there is still an importance of checks and balances to prevent too much power from being concentrated in the hands of a single office. A democracy is a form of government that has many different political parties participating in politics.
dictatorship is considered the ultimate form of government with no other political parties participating. Dictatorships are ruled through a centralized state or city, but are often ruled directly by a military leader. The role of the military leader is very important because they are considered the power of law and order. Without any form of rule by elected representatives, many countries have experienced coups. Since coups are basically a form of government, even in non democratic countries, they are still considered to be a form of government.
For those who are interested in how this all works, there are government securities. These are a type of investment where the government promises to pay out certain returns over a certain amount of time. For example, during World War II the United States government guaranteed funds for United States citizens to use for the economic recovery of the country. During World War I a similar guarantee was given by the British government. There are also other forms of government securities available throughout the world.
There are several different types of government securities including treasury bonds, municipal bonds, corporate bonds, interest rate certificates, and interest rate warrants. The United States government issues both treasury bonds and municipal bonds as their main form of income through investments. In fact, most governments around the world issue debt through these types of government securities.
When an investor is purchasing these types of securities the principal is based on a certain percentage of the value of the debt. The best rates for these types of government securities are generally higher because of the lower default risk. There are a number of financial institutions that purchase these government securities. One of the main reasons for this is that the government feels that it is necessary to keep interest rates low to encourage investors to buy these securities. Although there are many reasons why interest rates are lowered, the primary reason behind them is to keep default risk low and to keep the economy healthy.