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If you are prepared for some risk, junk bonds pay about 5%, but they tend to get whacked when interest rates rise. Same with lower-yielding but higher-quality corporate bonds.

In principle, junk bonds are basically useful, but they are used excessively and irrationally, notably in takeovers.

The rating agencies historically actually did a pretty good job rating regular bonds.

Junk bonds prove there's nothing magical in a Aaa bond rating.

Today, credit rating agencies rate companies, countries and bonds.

For investors who do want to speculate in high-yield bonds, one alternative may be a junk bond mutual fund, which can offer investors the relative safety of diversification.

Remember this: debt is a form of bondage. It is a financial termite.

Bond investors want growth much like equity investors, and to the extent that too much austerity leads to recession or stagnation then credit spreads widen out - even if a country can print its own currency and write its own cheques.

Equities are boring; bonds are disgusting.

The best companies with the strongest credit ratings borrow like the United States: on a non-prioritized basis. This means that in the event of a default, all of their debts are of equal priority because lenders and creditors believe default is highly unlikely. And they spend considerable effort maintaining this status.