spray the surrounding dirt with some water and look carefully with a flashlight for caterpillars and slugs. also check the plant carefully for caterpillars. any sign of leaves being eaten? also check the plant and dirt at night with a flashlight.
Definitely sounds like a worm/caterpillar making a silky lil nest and pooping causing the rot.
Fricken hate those shitty lil bastiges
The day I saw a gnarly wasp pick a caterpillar worm off a plant was the day I stopped hating the wasp.
They make nest in the eaves around my house every year. Now I only spray the ones in my entry way and leave the rest.
Saw a moth on one of my plants today, swatted to the ground and stomped on the bastige. They are who leave the eggs that turn into worm larvae and tear shit up. On the bright side I saw a wasp on a plant today also, no doubt eating some shitty larvae or bug.
I've never had a problem with those paper wasps despite that I used to have a lot of them around. I had one at the back door to my office some time back and I'd go out to get better cell reception and pace back and forth right under its nest (before I knew it was there). Thing would dive bomb me and smack me in the back of the head every time I turned my back on it, but never stung me. Gave it a pass and did my pacing a bit farther away for the rest of the season.
I was just about to post about the same problem. Every year I find a few pods like this but this year, the pest is goofing up about half of my pods. The scorpion, douglah, bhutlah, and most all of the red peppers are getting hit hard. Funny thing is none of the yellow peppers or red reapers are getting hit at all. No leaf damage and I never find a bug on any of the plants. I suppose I'll dust them with diatomaceous earth or get some BT.