Question

250 words

U.S. Treasury bonds are not rated. Why? Often, junk bonds are not rated. Why?

Answer 1

All bonds are rated on the basis of default risk. Accordingly the above questions can be answered as follows:

US Treasury Bonds have no risk. They are entirely backed by the US Government. So there is no point in rating such bonds.
And as for junk bonds, the very name of the bonds suggests why junk bonds are not rated. Junk means uselss, so these bonds have a very high chance of default. The holder of such bonds does not have any way to make money from them. There is simply no point to ask the issuer to pay a rating agency to get a low rating assigned to these bonds.