A bearer bond is a type of bond that was issued by companies that did not require any type of registration by the owner. With this type of bond, if you had physical possession of the bond, you could cash it in. These bonds paid interest and you would also get back your original principal in the bond. 

This type of bond is no longer issued in the United States. In 1982, the government outlawed them because of the risks that come with them for owners.

Bearer bonds were considered to be very attractive for certain investors but they were also very risky. If this type of bond was lost or stolen by someone else, there is virtually no way that the original investor could get them back. In today's bond market all bonds are registered in an electronic system and are not physically issued to the investor. This way, there is no chance that the bond owner could lose the bond or their initial investment.

The bearer bond was a favorite instrument of criminals as they could make financial transactions with them without anyone else having to know. They could also steal them and cash them in without any problems. 

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