Category Archives: Economy

Economic Issues, Taxes, Capitalism

“The biggest corporate lay-off in history is expected within days”

“IBM believed to be scrapping 110,000 of its 430,000 workforce around the world”

IBM

Robert Cringley, from Forbes, said: ‘To fix its business problems and speed up its “transformation,” next week about 26 per cent of IBM’s employees will be getting phone calls from their managers.

‘Project Chrome will hit many of the worldwide services operations. The USA will be hit hard, but so will other locations.’

An IBM spokesman said: ‘IBM does not comment on rumours, even ridiculous or baseless ones.

‘IBM has already announced the company has just taken a $600million [£400million] charge for workforce rebalancing. This equates to several thousand people, a mere fraction of what’s been reported.’”

From the UK Daily Mail

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US Bribing Iran With $11.9 Billion To Get Them To Attend Nuclear Talks

And the Iranians have told the world that they will never stop their nuclear ambitions.

Hasan Rouhani

The Obama administration on Wednesday paid $490 million in cash assets to Iran and will have released a total of $11.9 billion to the Islamic Republic by the time nuclear talks are scheduled to end in June, according to figures provided by the State Department.”

OK, but what is the money for?

These cash payments by the United States have been made with no strings attached, prompting concerns that Iran could use the funds to finance its worldwide terror operations, which include the financial backing of Hamas, Hezbollah, and other rogue entities.”

Don’t believe it? Read the rest at the Washington Free Beacon

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Chicago Bankruptcy Looming?

hancock bldg

From Second City Cop:

Someone Want to Verify This?

FYI, members of the cities law department, finance and mayors office (not the mayor) had an “impromptu” meeting with attorneys at Jones-Day law firm. You probably think why is this important. Its important because if you do research you will see that the Jones-Day law firm just finished handling the City of Detroit’s Bankruptcy. Jones-Day orchestrated the entire Detroit financial restructuring and pension overhaul. Research even further and you will find that Jones-Day are major business/municipality experts for bankruptcy. Trust me, that 500 million dollar payment for our pensions will not get paid and the above meeting is why. Yes, the city will declare bankruptcy to get its pension overhaul. The information may seem off the wall and exaggerated but from the person I got the information from its extremely reliable and needs to be received seriously. God help us.”

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People In Venezuela Are Learning How Well Government Planning Doesn’t Work

Pictures like this remind me a lot of the pictures that came from the Soviet Union. Venezuelan stores are nicer on the outside but they are still empty. The government makes promises that no one, including the bureaucrats who make them, expect will be kept.

Empty shelves sit in a supermarket in the La Boyera part of eastern Caracas on Jan. 9, 2015.

Empty shelves sit in a supermarket in the La Boyera part of eastern Caracas on Jan. 9, 2015.

Shoppers thronged grocery stores across Caracas today as deepening shortages led the government to put Venezuela’s food distribution under military protection.

Long lines, some stretching for blocks, formed outside grocery stores in the South American country’s capital as residents search for scarce basic items such as detergent and chicken.”

This is what the government has to say:

Government officials met with representatives from supermarket chains today to guarantee supplies, state news agency AVN reported. Interior Minister Carmen Melendez said yesterday that security forces would be sent to food stores and distribution centers to protect shoppers.

“Don’t fall into desperation — we have the capacity and products for everyone, with calmness and patience. The stores are full,” she said on state television.”

So, the government has solved the problem by telling the store management that they Must Guarantee availability of products and by lying about availability. How well will that work? The President tried to reassure the people with this:

President Nicolas Maduro last week vowed to implement an economic “counter-offensive” to steer the country out of recession, including an overhaul of the foreign exchange system. He has yet to provide details. While the main government-controlled exchange sets a rate of 6.3 bolivars per U.S. dollar, the black market rate is as much as 187 per dollar.”

The whole thing sounds just like the failure of every supply line in every country in the world that was ruled by communists.

Ah, but the leftists in this country believe it will be different in the United States because they will have the right people on the jobs. BS. If they make it happen here it will be exactly the same. They will purge anyone who is efficient and promote the apparatchiks.

Read more at Bloomberg

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“Bank of America warns of ‘lethal’ damage to China’s financial system as deflation deepens”

“‘Deflation, Devaluation, and Default’ loom in China this year. The denouement for Shanghai’s bourse will not be pretty, says the US bank.”

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China is at mounting risk of a financial crisis this year as growth sputters and deflationary pressures trigger a wave of defaults, Bank of America has warned.
The US lender told clients that a confluence of forces are coming together that threaten to chill the speculative mania on the Shanghai stock exchange and to expose the underlying fragility of China’s $26 trillion edifice of debt.”

Read the rest at the UK Daily Telegraph

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Without Comment:

chinese flag

45 Signs That China Is Colonizing America

Read this

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California Doubles Down On Fiscal Irresponsibility

California high-speed rail set to break ground this week

ca high speed rail

ca mi speed rail map

Ready or not, Californians – and America – here it comes.

After a two-year delay, during which the cost nearly doubled, California’s high-speed rail system will break ground this week. The project – said to cost $68 billion – will link Los Angeles to San Francisco by 2028.

There’s only one teensy, tiny problem: they have no idea how they are going to fund it.”

Why should they worry about the money? There’s always money, right? Just raise taxes and fees and everything will be OK.

They now say it will cost $68 Billion. How much will it eventually cost? I’d bet it will be closer to $250 Billion.

What of that 200 mph boast? The original design of the project called for railroad tracks totally dedicated to the high-speed rail system. But that proved even more ruinously expensive than the current guestimate. So now, the plan calls for a “blended” arrangement, where the HSR will share the tracks already used by commuter rail systems. That will slow the train down to around 60 mph through the cities and towns already serviced by ordinary railroads.”

And the money?

The policitians are banking on a federal bailout when the funds don’t materialize. The reasoning goes, we’ve already spent $26 billion on this turkey. Why not spend another $26 billion to finish it?”

Read more at American Thinker

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Good For Thee But Not For Me

Health Care Fixes Backed by Harvard’s Experts Now Roil Its Faculty

Dr. Alan M. Garber, a physician and health economist who is the provost at Harvard, defended the change in benefits, acknowledging that Harvard employees would face greater cost-sharing but saying that such a policy "can slow the growth of health spending.” STEPHANIE MITCHELL, VIA HARVARD UNIVERSITY

Dr. Alan M. Garber, a physician and health economist who is the provost at Harvard, defended the change in benefits, acknowledging that Harvard employees would face greater cost-sharing but saying that such a policy “can slow the growth of health spending.”
STEPHANIE MITCHELL, VIA HARVARD UNIVERSITY

WASHINGTON — For years, Harvard’s experts on health economics and policy have advised presidents and Congress on how to provide health benefits to the nation at a reasonable cost. But those remedies will now be applied to the Harvard faculty, and the professors are in an uproar.

Members of the Faculty of Arts and Sciences, the heart of the 378-year-old university, voted overwhelmingly in November to oppose changes that would require them and thousands of other Harvard employees to pay more for health care. The university says the increases are in part a result of the Obama administration’s Affordable Care Act, which many Harvard professors championed.”

They were all for it until it affected them. Now they are against it. Who is surprised by this?

It seems that Harvard is trying to save money by shifting costs to sick people,” said Mary C. Waters, a professor of sociology. “I don’t understand why a university with Harvard’s incredible resources would do this. What is the crisis?”

That’s what many of us asked when the Affordable Care Act, aka Obamacare, was rammed through. What’s the crisis?

Read the rest at the New York Times

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We Are Nearing The End

Vancouver, B.C., Canada: Fish with cataracts is fitted with a glass eye to stop it being ‘bullied’ by other marine creatures

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I probably would have chosen broiled with a nice lemon vodka sauce.

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An Interesting Thing Happened On The Way To The Next Bubble

Everyone forgot the past and ignored the warning signs in their quest for wealth.

When it comes to Oil, OPEC matters, as does Oil Shale, production cuts, geopolitical risk, etc. However, the reality is that all of these are minor issues against the MAIN STORY: the $9 TRILLION US Dollar carry trade.

Drilling for Oil, producing Oil, transporting Oil… all of these are extremely expensive processes. Which means… unless you have hundreds of millions (if not billions) of Dollars in cash lying around… you’re going to have to borrowmoney.

Borrowing US Dollars is the equivalent of shorting the US DOLLAR. If the US Dollar rallies, then your debt becomes more and more expensive to finance on a relative basis.

There is a lot of talk of the “Death of the Petrodollar,” but for now, Oil is priced in US Dollars. In this scheme, a US Dollar rally is Oil negative.

US Dollar:

sc_0

Flip that chart on it’s head and compare it oil:

sc-1_0

More below the fold…

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Lefties Paving The Way For A Bernie Sanders Run

Avowed socialist, Vermont Senator, Bernie Sanders thinks he wants to be President of the United States.

bernie sanders dingalings

His far-left positions on everything don’t deter him a bit. Why should they? We elected Barack Obama twice.

What does Sanders believe? What are his positions? Well, he believes in the ‘Deficit Owl’:

deficit-owl-550x413

More at the Washington Examiner.

And now we have Russia Today telling us that all the bad things we know about communism are wrong:

“Why You’re Wrong about Communism”

It looks like a setup to me.

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Cruz, Lee, Sessions Display Leadership

Cruz and Lee depart the Senate floor after their speeches before the night-time budget vote at the U.S. Capitol in Washington

Republican Sens. Ted Cruz, Mike Lee, and Jeff Sessions are pushing for a vote to defund President Obama’s executive amnesty in the “Cromnibus” spending bill Friday night, The Daily Caller has learned.

The trio of conservative senators is hoping to get the defund vote onto the Senate floor as a “point of order,” which would force a procedural vote on the issue without Democratic Senate Majority Leader Harry Reid having to introduce it.

The senators are pushing hard on Capitol Hill for the measure as of early Friday afternoon. If successful, the vote would take place late Friday night, after planned deliberations on the defense budget.”

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“Conservatives: Let’s Primary Every GOP Boneless Wonder Who Votes For The CRomnibus”

Boy, do I agree with this. Each and every Republican who votes for this monstrosity needs to be thrown out. We may not be able to succeed in firing them but primarying them is another matter.

The bill includes funding for abortion, amnesty for illegal aliens, benefits for illegals, the war on coal, and costs more than a Trillion dollars. With our runaway national debt this is exactly the opposite of what the country needs.

omnibuscartoon121114

There’s only one way to stop Obama’s destructive policies, especially the ruinous spending that has pushed America into a national debt of over $18 trillion, and that is for Republicans to stop voting “YES” on spending bills like the “CRomnibus.”

However, the policies that are funded by the “CRomnibus” represent practically everything that conservatives who volunteered, donated and voted in the 2014 midterm election thought they had just defeated.

But what is the deepest betrayal by the House Republican leaders behind the bill is that it is not something that was forced upon a reluctant Republican majority in the House by Harry Reid and the just defeated Senate Democrats – this is a deal Republican leaders negotiated on behalf of themselves and the House Republican Conference.”

This idea came from Conservative HQ where there is a more in-depth description of the things that are bad about this bill.

Update: The bill passed the House 219-206. The roll call vote list is here. Is your Congresscritter on the list of yeas? Mine is.

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WaPo: “Deal reached on $1.01 trillion spending bill”

Cloward, meet Piven.

boehner laughing

Congressional leaders unveiled a massive $1.01 trillion spending bill Tuesday night that will keep most of the federal government funded through September.

The legislation is expected to pass in the coming days and will allow the incoming Republican-controlled Congress to clear the decks of lingering spending issues while setting the stage for a prolonged fight with President Obama over immigration policy.

At 1,603 pages, the bill includes at least $1.2 billion for agencies to deal with the influx of unaccompanied immigrant children who crossed the U.S.-Mexico border.”

Read more at the Washington Post

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Bush, Obama, & Both Parties Have Destroyed America

For the first time since Ulysses S. Grant was President, the United States of America do not comprise the world’s leading economy. Makes you proud, doesn’t it? Enjoy the decline. It’s only gonna get worse. I f-king hate these people.

Hang on to your hats, America.

And throw away that big, fat styrofoam finger while you’re about it.

There’s no easy way to say this, so I’ll just say it: We’re no longer No. 1. Today, we’re No. 2. Yes, it’s official. The Chinese economy just overtook the United States economy to become the largest in the world. For the first time since Ulysses S. Grant was president, America is not the leading economic power on the planet.

It just happened — and almost nobody noticed.

The International Monetary Fund recently released the latest numbers for the world economy. And when you measure national economic output in “real” terms of goods and services, China will this year produce $17.6 trillion — compared with $17.4 trillion for the U.S.A.

As recently as 2000, we produced nearly three times as much as the Chinese.

Oh yeah, we’ve just hit a record low for our birth rate. We’re watching it slip away, folks. It’s quite depressing.

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Sowell: ‘Ferguson Going The Way Of Detroit’

Thomas-Sowell

Thomas Sowell provides some insight into the future of places like Ferguson, Missouri. He reminds us of the cities that have experienced riots in the past.

Ferguson-african-american-business-owners-cope-with-aftermath-of-weekend-riot-450x300

What are the consequences to be expected from an orgy of anarchy that started in Ferguson, Missouri and has spread around the country?

The first victims of the mob rampages in Ferguson have been people who had nothing to do with Michael Brown or the police. These include people — many of them black or members of other minorities — who have seen the businesses they worked to build destroyed, perhaps never to be revived.

But these are only the first victims. If the history of other communities ravaged by riots in years past is any indication, there are blacks yet unborn who will be paying the price of these riots for years to come.

Sometimes it is a particular neighborhood that never recovers, and sometimes it is a whole city. Detroit is a classic example. It had the worst riot of the 1960s, with 43 deaths — 33 of them black people. Businesses left Detroit, taking with them jobs and taxes that were very much needed to keep the city viable. Middle class people — both black and white — also fled.

Harlem was one of many ghettos across the country that have still not recovered from the riots of the 1960s. In later years, a niece of mine, who had grown up in the same Harlem tenement where I grew up years earlier, bitterly complained about how few stores and other businesses there were in the neighborhood.”

Of course you know he is correct. Merchants and service providers in the Ferguson area have been burned badly and they have no solution but to leave. City, county, state, and federal government leaders have sided with the looters. The same thing happened with the ‘Occupy’ movement a couple years ago. Those leaders don’t want a solution to the destruction. If they did they would not condone – no encourage – it.

The businesses of Ferguson and surrounding areas will close, one by one, until they are all gone.

But where will these business owners go? It will be the same all across the country. The Obama administration has taken sides against them.

It’s all part of the plan.

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PuffHo: Bernie Sanders Describes Twelve Steps To Cloward/Piven

bernie sanders

From the Huffington Post:

An Economic Agenda for America: 12 Steps Forward

The American people must demand that Congress and the White House start protecting the interests of working families, not just wealthy campaign contributors. We need federal legislation to put the unemployed back to work, to raise wages and make certain that all Americans have the health care and education they need for healthy and productive lives.

As Vermont’s senator, here are 12 initiatives that I will be fighting for which can restore America’s middle class.”

Read ‘em and weep. He outlines twelve ways to spend us into oblivion. The comments section is full of leftists who support him, too.

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“The Middle Class Spending Crash Explained”

The video below explains that people are cutting back on some things because we are spending more on health care, internet service, cell phones, and electric bills.

Funny, though, Americans have not cut back on purchases of firearms and ammunition. There have been reports that there were nearly three FBI background checks for firearm sales Per Second on Black Friday.

This is from Zero Hedge:

With Black Friday sales plunging and Cyber Monday growth slowing, it appears the chicken of stagnant wages and debt-saturation are coming home to roost for a massacred middle-class America. However, as WSJ reports “we are buying less stuff,” because the basic costs of necessities such as healthcare, food eaten at home, rent, education, and cellphones have surged.”

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California State Teachers’ Retirement System Polls Teachers

CalSTRS: “We have wasted billions of your dollars. Should we waste billions more?

money toilet

The CalSTRS has a survey for California teachers.

From SDA:

My wife is a school teacher in the Oakland School District – OUSD. Yes, she deserves combat pay … and suffers from PTSD every day after work. In today’s email inbox comes a note from the CTA (California Teachers Association – UNION) an URGENT need to Survey Teachers opinions on “sustainability” as drafted by the STRS State Teachers Retirement System.

http://www.calstrs.com/whats-new/your-input-valuable-please-complete-calstrs-sustainability-survey

Seems as though STRS wants … i-n-p-u-t … on “sustainability” issues from Teachers. More specifically, should STRS PLAY with Teachers Retirement Funds in assorted “Green” Schemes (excuse me … I meant “Green” corporations) ? Since CALSTRS is underfunded by approximately $ 40 BILLION dollars at the moment … the geniuses who are running the system (my wife’s retirement checks) into a ditch … can’t think of anything better to do than GAMBLE on … “ethical” … investments that protect gaia. Don’t ask me WHY the Investment “experts” … PAID massive salaries to MAXIMIZE (I hope) the rate of return on Teachers retirement funds … need the advice of a bunch of leftist Teachers (most of them are) on suitable investments. I suppose the survey results will provide political cover for these MORONS when their investments turn into a thousand Solyndra’s. In fact, I suggest that since the Solyndra debacle raised public awareness about Federal Funding of JUNK Green companies, that the leftists in government have found a NEW source of funding for their pet green projects … PENSION FUNDS!!

Yes … lets swindle Teachers out of their retirement pay (ultimately, the CA Taxpayers who will FUND the shortfalls) to keep lining the pockets of our crony greenist-capitalists.”

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Bend Over. Taxpayer Bailout Coming For Chicago Pension Debt.

Everybody talks about how bad the pension debt in California cities is but Chicago’s isThree times bigger than either Los Angeles, San Francisco, San Diego, or San Jose:

14117-chicago-debt

Don’t believe it? Read the rest at Doug Ross

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Colt Firearms Company Is Dying

I guess we should have seen this coming. Colt once made excellent products that every shooter wanted. One by one they stopped building their best. The Single-Action Army revolver, their various double-action revolvers, including the fine ‘snake’ series which culminated in the Python in .357 Magnum,

colt python

and their decisions to refuse to sell AR-15’s to civilians, and to keep their manufacturing facilities in New Haven, CT where they are subject to anti-gun legislation and likely union contract troubles.

All in all the story of Colt’s demise sounds like slow suicide.

colt logo

Colt Defense LLC warned that it could default by the end of the year, as the privately owned company, which has suffered from declining demand for rifles and handguns, is likely to miss a payment to bondholders.

The gun maker faces a $10.9 million payment to bondholders Nov. 17, according to a filing on Wednesday with the U.S. Securities and Exchange Commission. If Colt skips the payment, it will enter a 30-day grace period, but without payment by Dec. 15 it will be in default and bondholders can demand immediate, full payment.

Colt, which is controlled by investment firm Sciens Capital Management LLC, had $248.8 million outstanding on the bonds as of June 29. The bonds were trading in the mid-30 cents on the dollar—deep in distressed territory—on Thursday.”

Read more at Bearing Arms

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Goober Video #6: ACA Was Designed To Kill Health Insurance

Jonathan Gruber

Jonathan Gruber

In Jon Gruber’s Newest (Sixth) Video, He Explains How Obama and Democrats Conspired to Get Rid of Tax Exemptions for All Insurance Plans Without Anyone Noticing

Economists have called for 40 years to get rid of the regressive, inefficient and expensive tax subsidy provided for employer provider health insurance,” Gruber said at the Pioneer Institute for public policy research in Boston. The subsidy is “terrible policy,” Gruber said.
“It turns out politically it’s really hard to get rid of,” Gruber said. “And the only way we could get rid of it was first by mislabeling it, calling it a tax on insurance plans rather than a tax on people when we all know it’s a tax on people who hold those insurance plans.”

More at CNN

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Telegraph: “The dollar’s 70-year dominance is coming to an end”

Somebody else is watching these goings-on. When a national media source does so it is significant.

Within a decade, greenback’s could be replaced as the world’s reserve currency

scared george dollar

So America doesn’t worry about balance of payments crises, as it can pay for imports in dollars the Federal Reserve can just print. And Washington keeps spending willy-nilly, as the world buys ever more Treasuries on the strength of regulatory imperative and the vast liquidity and size of the market for US sovereign debt.
It is this “exorbitant privilege” – as French statesman Valéry Giscard d’Estaing once sourly observed – that has been the bedrock of America’s post-war hegemony. It is the status of the dollar, above all, that’s allowed Washington to get its way, putting the financial squeeze on recalcitrant countries via the IMF while funding foreign wars. To understand politics and power it pays to follow the money. And for the past 70 years, the dollar has ruled the roost.”

This and more are at the UK Telegraph

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“Greenspan’s Stunning Admission: “Gold Is Currency; No Fiat Currency, Including the Dollar, Can Match It””

What will this do to the dollar? How ’bout to the gold market?

From Zerohedge:

For some reason, the Council of Foreign Relations, where ex-Fed-Chief Alan Greenspan spoke last week, decided the following discussion should be left out of the official transcript.

GREENSPAN: …remember, we had that first tapering discussion, we got a very strong market response. And then we reassured everybody to have no — remember, tapering is still (audio gap) of an agreement that the central banks have made — European central banks, I believe — about allocating their gold sales which occurred when gold prices were falling down (audio gap) has been renewed this year with a statement that gold serves a very important place in monetary reserves.

And the question is, why do central banks put money into an asset which has no rate of return, but cost of storage and insurance and everything else like that, why are they doing that? If you look at the data with a very few exceptions, all of the developed countries have gold reserves. Why?

TETT: I imagine right now, it’s because of a question mark hanging over the value of fiat currency, the credibility going forward.”

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‘Improving’ The United States

This image is from 90 Miles From Tyranny:

obama improved us

Of course the vomit image could be a reference to Ebola or it could be a reaction to Michelle’s claim. Americans across the country consider his efforts to have been spectacular failures.

But they’re not. They are successes.

Not long ago president Obama commented that his successes are, “Just not being reported”. If you examine his goals he may well be right.

He told us up front that he wanted to remake America. Observers have told us also that his goals for the country are to reduce its world position and to convert the country’s economy into something the opposite of a free, capitalist one.

If these are his goals, and I believe they are, he is succeeding. Michelle’s comment above makes a lot of sense in that light.

We should not try to determine whether he is succeeding or not based upon our definitions of success. He has a different view.

Update: Obama Promises to Solve Ebola ‘Just Like We’ve Solved Every Other Problem’

It was Obama’s Chief of Staff who said, “Never let a crisis go to waste”.

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