Bloomberg has a story today headlined Banks Have $891 Billion at Risk in CP, Fitch Says in which the authors state that "Some companies that use commercial paper to buy asset-backed securities or collateralized debt obligations backed by subprime mortgages are having trouble finding investors." That shouldn't be a surprise. Given that the valuations of no ABS's or CDO's related to mortgages can be trusted right now, why would anyone want even the shortest term CP related to these as there could be insta-default loans hidden in said CP.
Clearly the issuers of ABS CP do so as a sort of bridge financing while they find long term buyers of the ABS. Personally, I think that the seize-up of the market for this sort of CP is healthy as it will force issuers of ABS to demonstrate plainly that the mortgages they are selling warrant the ratings they receive.