Well rated Bonds

REPORT FROM BLOOMBERG:

Bear Stearns told investors in one of its hedge funds that they won't get any money back after creditors forced it to sell assets at depressed prices.

A second fund still contains `sufficient assets' to cover the $1.4 billion it owes its parent firm, there's very little value left for the investors.

The funds faced `unprecedented declines' in bonds that were rated AAA or AA, the two top investment grades.

Lesson: It is possible for well-rated bonds to face unprecendented declines, and may lead to a 'credit event'.