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Because the senator from Vermont (who was elected on the Republican ticket) changed his party affiliation while in office and became an Independent there is some fear that the senate (since the Democrats now have a majority) will now try to initiate some energy price controls in the California market. I don't think it will work because price controls won't cause producers of all type products to develop more efficient energy technology. Price controls will not fix the problem, they will only create more shortages. Anyhow, assuming the worst and it does happen I don't think it will have too much of an impact on PPL's earnings. As usual the market over- reacts to any negative news and punishes the whole group. The speculators and momentum investors who jumped on board are now pulling up stakes. I'm looking for it to bottom here in the mid-fifties until just prior to the earnings announcement next month when it should rally back to its old highs (unless bargain hunters move it higher before then). Of course, this is just my opinion. The energy crisis has not gone away. Here's hoping they beat the estimates once again.

Regards,
Mike

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