Fate of more CDOs to be decided soon

The Financial Times notes that a rash of CDO liquidations may be in the works. Moody's says about 50 are in Events in Default. Half of those are being "accelerated," which means the CDO has declared all notes payable. What's going on? Apparently, the super senior investors are counting on something that Moody's has reportedly stated: if CDOs were to liquidate, it might actually lead to a credit upgrade for the senior-most tranches. This is an "iffy" bet, at best. The Financial Times points to Adams Square as an example of how the protective cascade of cash did not really cover the senior-most holders. So the senior managers, who hold the cards (so to speak), really have a huge decision to make: A liquidation might help them, at the extreme expense of the junior rated issues. It's a dog eat dog world, and many seem to have already decided.  

For more:
- here's the Financial Times item