It was one of their operating units that filed, but the fallout has the potential to be huge. Somewhere in the past few months I posted some of the banks that would feel the pain, I have misplaced the list on my messy desk...
I also think some of the money market funds hold some of this paper. If the $1 dollar level does not hold in some of these funds, there could be a panic.
BTW, of interest, a case of buy high & sell low???
I have a friend that owns a coin shop, and I stopped in yesterday and asked him if people were selling or buying gold at the current price level.
He and his other counter men started laughing. It turns out that for every ounce they sell to a retail customer, they are buying 14 ounces, so people are just bailing.
I am not sure what this really means, but I think this might be a good time to take on some long positions..If we have a melt due to this bad PCG paper, maybe we could get a mini rally in gold??
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Pacific Gas & Electric Co., one of the nation's largest utilities, had run up billions of dollars in debts on the spot wholesale electricity market. It said the latest actions by state regulators mean it will continue to increase its debts by more than $300 million a month.
The filing marks the latest twist in California's failed attempt to deregulate its electric power markets, and also stands as one of the largest bankruptcy filings in U.S. financial history.
"The regulatory and political processes have failed us, and now we are turning to the court," said Robert D. Glynn, Jr., Chairman of Pacific Gas and Electric Company, in a statement. "We expect the court will provide the venue needed to reach a solution, which thus far the State and the State's regulators have been unable to achieve," he said.
The filing does not affect Pacific Gas & Electric's parent company PG&E Corp. or other units of the parent corporation.
The filing was made in U.S. Bankruptcy Court for the Northern District of California in San Francisco. It came a day after California Gov. Gray Davis reluctantly agreed to some rate hikes for the state's cash-strapped utilities. |
