The problem with this situation though is that, since these bonds were collateralized by different pieces of other bonds - making it difficult to really figure out what the quality of the collateral was/is. There was an odd rating agency practice of assuming that a basket of, say, AA rated pieces could be combined to become AAA rated in the new package. Since higher rated securities pay lower yields to the purchasers, this practice allowed the sellers/packagers to make a little more price spread improvement for themselves.
Trouble is these aren’t really bonds, nothing but glorified IOUs.