More 'Containment' Issues

Yet another shoe drops from the subprime centipede. This time hitting a short term bond fund run by GE. No doubt this will not be the last such fund to reveal losses from assets they should never have been invested in. From Bloomberg:

GE Bond Fund Investors Cash Out After Losses From Subprime

A short-term bond fund run by General Electric Co.'s GE Asset Management returned money to investors at 96 cents on the dollar after losing about $200 million, mostly on mortgage-backed securities.

The GEAM Trust Enhanced Cash Trust, a short-term bond fund with about $5 billion in assets, told non-GE investors on Nov. 8 that they could withdraw their money before losses mounted. Enhanced cash funds usually offer higher yields than money- market funds by investing in riskier assets.

All outside investors, who together held "several hundreds of millions of dollars" in the fund, pulled their money, Chris Linehan, a GE Asset Management spokesman in Stamford, Connecticut, said yesterday in an interview. Most of the fund's money before the redemptions came from GE's corporate pension plan and remains invested.