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To: michel ciambra who wrote (619)	12/22/2000 8:29:15 PM
From: Chip McVickar	Respond to of 12411

Michel, This article spells out the most significant element of the California utility problem. Debt Load, Greenspan may extend credit lines to control the fear of the nations credit lines freezing up. It's possible the we will have a bottom on Tuesday to these markets, but I doubt Greenspan lowers rates at this time to bail out California. IMO..., there is certainly troubled waters here for the entire deregulation package and the country, but not solved by cutting rates at this time. Chip 12/22 14:41 By Mark Lake and Liz Goldenberg New York, Dec. 22 (Bloomberg) -- Federal Reserve Chairman Alan Greenspan agreed to meet California Governor Gray Davis on Tuesday quote.bloomberg.com. ~~~~~~~~~~~~~~~~ Debt Load In addition to the losses, PG&E has a commercial paper program of $1.85 billion, some or most of which may come due within the next four weeks. Southern California Edison has a commercial paper program of $1.6 billion. Both companies are under review for a possible debt ratings cut from Moody's Investors Service and Standard & Poor's, effectively barring them from issuing new commercial paper. Under typical circumstances, the companies would use backup credit lines to refinance the commercial paper if they couldn't issue new commercial paper. ``The commercial paper market is the lifeblood of the credit markets,'' said Tom Gallagher, a Washington-based at ISI Group Inc. ``If all of the sudden there's a problem there, credit markets can freeze up really fast.''