"More than $9 billion of auction- rate bonds sold by student-loan agencies in states from Pennsylvania to Utah have trapped investors in debt that's not paying interest," Bloomberg reports. "The collapse of the auction-rate market drove interest costs paid by states, hospitals and student-lending agencies as high as 20 percent, and froze investors in securities they couldn't sell. Now, holders of student-loan debt are stuck with bonds paying less than the 0.76 percent rate on the one-month Treasury bill. The bonds pay nothing because of a formula designed to ensure that borrowers don't pay more interest on their debt than they receive from their student-loan clients."