So you can also exchange bonds for goods and services. If you are using an interest bearing bank account, this is basically exactly what you are doing-- your do

So you can also exchange bonds for goods and services. If you are using an interest bearing bank account, this is basically exactly what you are doing-- your dollars in the account are not actual dollars, but have been pooled into a fund that buys short term treasuries or other debt. The bank is paying you the interest on those treasuries, while taking a fee, and betting that a run on the bank doesn't render them insolvent. I think the point to be made is that government bonds don't have any collateral baking them. For example, if a corporation has secured debt, the holders of those bonds might get first liquidation preference-- if the company can't pay its debt, the company's assets are distributed to bond holders, so you get something back. Governments have assets, but since they also have central banks which can issue dollars, in the even of a default, it seems far fetched to think government bond holders would claim government assets-- instead the central bank would just dilute its currency. This was not the case by the way in the gold standard, where government bond holders could redeem the dollar bonds and then also redeem them for gold, which would still have value outside of the failed state.