The Kremlin line is that the teamwork between Mr Putin as prime minister and Mr Medvedev as president will guarantee stability, creating a good base for more liberal reforms.

ECONOMIST: Russia's presidency

Basically they allow for the possibility of investment growth over the guarantee amount but also provide a guaranteed income base.

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With no guarantee, and no real way to measure how much of the tax base will come back in the near term, the bonds would not be likely to get insurance, a required element for many institutional buyers.

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