>>"Second - [..]there is no fair situation where I accept a negative (or nil) expected rate of return for taking on real risk." Except that governments don't n

>>"Second - [..]there is no fair situation where I accept a negative (or nil) expected rate of return for taking on real risk." Except that governments don't need any market to finance themselves. Even if you want to keep that fiction, you can do something like the European Central Bank is doing with the debt of the Euroarea. They don't buy the bonds directly but they buy them in the secondary market, creating demand. The investor would not buy that bond for the return, only to make arbitrage between the primary and the secondary market. There are many tricks that can be done to hide the obvious fact that governments are not households and control the currency, but, at the end of the day, that's the reality.