If you have a billion € in cash, even in the form of a 1 billion € banknote, how do you store it? It has a cost, for obvious security reasons. You cannot put it on a bank account either, because putting money on a bank account is equivalent to having a 0% bond with a non-risk-free bank: you don't own your money, you just lent it to the bank, if it fails, you lose your money.
Having a treasury bond nowadays is the same as having money on a bank account, it's just a line of credit written somewhere, the huge difference is that if the organism recording the line of credit (a broker, for instance) fails, you still own your bund.
Oh, that actually makes sense. It atleast explains why interest can be nagative on bunds. It's money with a back-up copy in e.g. the Central Bank if you lose it.
Why make the fuzz and having bunds in the first place and not just have the Central Bank offer accounts with a card connected? The bund system seems like an arcaic paper thing that made sense 40 years ago.
Having a treasury bond nowadays is the same as having money on a bank account, it's just a line of credit written somewhere, the huge difference is that if the organism recording the line of credit (a broker, for instance) fails, you still own your bund.