Seems simple to me. Countrywide (and others) is telling the security holder that you get paid some or none, what do you prefer. Since this plan was hatched with treasury and probably FED’s blessings to prevent a likely systemic meltdown, what options does the security owner have? At this point, most MBS/CMO/CDO holders will be glad to see any pennies on $. Just recently, ETrade sold a pile for 27 cents on $; that settles the precedent on what such papers are worth. It is all downhill from 27% now.
