Archive for July, 2017

William Shatner Slams SJWs – Says ‘Snowflakes’ “Stand For Inequality” And “Misandry”

Courtesy of ZeroHedge. View original post here.

William Shatner, the actor who famously portrayed Captain James Kirk in the original 1960s run of Star Trek spoke out against his progressive critics, claiming that SJWs “stand for inequality” while defending his use of terms like “snowflake” and “misandry” – a phenomenon that angry feminists insist has been extinguished in modern society.

Shatner, a Canadian citizen who’s publicly empathized with the far-right and President Donald Trump, has repeatedly feuded with Trekkies who feel that he has turned away from the show’s culturally-progressive message (Star Trek made television history by broadcasting television’s first interracial kiss, between Shatner and castmate Nichelle Nichols). The actor often calls out examples of what he considers to be unwarranted attacks on men.

SJW's can have political views but it's usually where they need to be superior in socio-economic terms. https://t.co/lLfPj6w6gV

— William Shatner (@WilliamShatner) July 31, 2017

And this is your failure of logic. SJWs stand for inequality, where they are superior to any one else hence my use of Misandry and Snowflake https://t.co/8uBGuFFM7a

— William Shatner (@WilliamShatner) July 31, 2017

All of that is true. I also use words like snowflake and misandry. What's your point sunshine? https://t.co/3Z0Zj1USIX

— William Shatner (@WilliamShatner) July 31, 2017

Shatner’s signature was notably absent from a February letter sent by the original Star Trek cast condemning President Donald Trump’s “racism and bigotry."

At least one liberal critic accused the actor of “tarnishing” Star Trek’s legacy with his “alt-right language,” according to Gizmodo.

"‘It seems that Shatner has not so much misunderstood the source material than turned away from it,’ Manu Saadia, author of Trekonomics: The Economics of Star Trek.

‘Star Trek is the lone TV show that has carried the torch of equality, progress, and utopia in popular culture. To see one of its most famous ambassador using alt-right language should be a wake up call to


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Hong Kong Interbank Rates Spike To Highest Since Lehman

Courtesy of ZeroHedge. View original post here.

For only the third time since Lehman, the price of liquidity in the Hong Kong Dollar interbank markets has exploded higher.

Overnight HKD Hibor soared over 60 basis points to 0.71407% in Monday trading – the highest since October 2008…

Note that the two previous spikes were around year-end, so this is unusual in both its velocity and size.

Of course, the narrative of a panic in Asian liquidity is not a good one for supporting risk assets and so the spike is being dismissed as a one-off due to several factors (as Bloomberg reports)…

Monday’s rise in Hong Kong dollar overnight interbank rate was due to major fund providers being more cautious in lending at month-end, and because of demand from some market players, a Hong Kong Monetary Authority spokesperson writes in an emailed reply to questions from Bloomberg. Interest rates subsided when fund providers responded by lending out more Hong Kong dollars. Relatively large movements in short- dated interest rate Monday was probably a result of thin market conditions ahead of the month-end. The market continued to function normally.

Monday’s sudden spike in HKD overnight funding cost is probably due to short-term funding activities, likely for I Squared Capital’s purchase of Hutchison Telecom’s unit and HSBC share buyback announcement, says Angus To, deputy head of research at ICBC International Research.

Rate likely to drop soon as HKD liquidity remains ample in general, To says in a phone call.

So just ignore the fact that the HKD liquidty markets just exploded due to month-end (well it hasn't before – see chart) and some M&A (there's been no M&A in the last 9 years?)… it's probably nothing.





A Few Charts and a Few Thoughts

 

A Few Charts and a Few Thoughts

Courtesy of 

Last night, David Schawel pointed out that the worst year for the Barclays Aggregate Bond Index was -2.9%. I’ve written in the past that a bad year for bonds is a bad week for stocks, but I was still surprised to learn just how shallow the worst calendar year was.

1

You might say, well duh, bonds have been in a bull market for thirty years. Fair, so let’s look back at the period from 1950-1981, when the ten-year rate went from 2% to 15%.

A portfolio of five-year notes (20%), long-term government bonds (35%), long-term corporate bonds (30%) and one-month t-bills (15%) returned 2.7% a year for this 32 year period. Not great- especially after inflation, but these are returns you could live with, when you consider that stocks returned 10.8% a year over the same time.  The chart below shows the ten year screaming higher (red) and the growth of $1 (black). Here’s proof that rates can rise without bonds going to zero.

2

I’m not trying to dismiss people’s concerns over bonds. At low rates, it makes sense to prepare for the fact that future returns won’t be as large as they have been in the past. But, and this is the important part, stocks will always represent the biggest risk to your portfolio. And by risk I don’t mean permanent loss of capital, but rather the wild swings that cause you to run for the hills. That’s risk.

The chart below shows how much more volatile stocks have been historically than long-term government bonds (these bonds are highly sensitive to interest rates).

3

The losses investors have felt from high quality bonds were nothing compared to stocks, and they did not show up on their statements…

4

The real losses were caused by inflation. If you bought long-term government bonds in 1940, forty years later, your dollar was worth $0.37, and you weren’t made whole until 1991!

5

If you’re scared about bonds getting killed, take a look at the next two charts. The image below shows the ten worst years for long-term government bonds, and…
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Here’s The Real Reason The Fed Is Making Absurd Monetary Decisions

 

Here’s The Real Reason The Fed Is Making Absurd Monetary Decisions

Courtesy of John Mauldin, Outside the Box, Mauldin Economics

I have often written about the Fed's abysmal track record in managing the economy. Here Lacy Hunt and Van Hoisington of Hoisington Investment Management explain the reasons for the Fed's consistently poor track record.

They start by considering the Fed’s “dual mandate,” which sets “the goals of maximum employment, stable prices and moderate long-term interest rates.” (And yes, that is actually three goals, not two.)

But a problem arises, the authors note, “because considerable time elapses between the implementation of the monetary actions designed to follow the mandate and when the impact of those actions take effect on broader business conditions.”

The time lag can easily be three years or longer, with the result that policy changes often end up being pro-rather than countercyclical. To make matters even worse, “the economic risks from adherence to this dual mandate are now much greater than historically due to the economy’s extreme over-indebtedness, poor demographics and a fragile global economy.”

But I’ll let Lacy Hunt and Van Hoisington unpack the idea themselves.

Hoisington Quarterly Review and Outlook, Second Quarter 2017

By Dr. Lacy Hunt and Van Hoisington

The Fed’s Dual Mandate

“Dual mandate” is one of the most commonly used phrases in U.S. central banking. The current Chair of the Federal Reserve often mentions it in both speeches and testimony to Congress. Not surprisingly, this is an extremely hot topic in monetary economics, and execution of this mandate has profound significance.

The mandate originated in The Federal Reserve Reform Act of 1977. This legislation identified “the goals of maximum employment, stable prices and moderate long-term interest rates.” Ironically, these goals have come to be known as the Fed’s “dual mandate”, even though there are actually three goals. The manner in which the Fed operates in following these goals has had and will have dramatic effects on economic activity. In this report we consider:

  1. What is the causal link between the mandate and the Fed’s capacity to act in a counter-cyclical fashion?
  2. How has


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Treasury To Issue Half A Trillion Dollars In Debt In Q4

Courtesy of ZeroHedge. View original post here.

In the first warning sign that the US Treasury is burning through more cash than previously expected, at 3pm today the Treasury Department announced that in its latest forecast of end-of-September cash balance it anticipated only $60 billion of cash on hand, nearly half the $115 billion it forecast in its previous report in May, according to the Department’s marketable borrowing estimates. The treasury also expects to borrow $96 billion in net marketable debt in the current quarter, down from $98 billion forecast previously.

This drawdown in cash, and jump in government outlays, was to be expected following the latest Monthly Statement from the Treasury which showed a surge in government outlays, which hit a record high $429 billion in June, for reasons discussed previously.

However, the second, and more troubling warning sign was that in its initial forecast of calendar Q4 marketable borrowing needs, the Treasury now expects a near record $501 billion in net marketable debt to be issued from October through December. This amount will be nearly equal to the actual marketable debt borrowed in the last 4 quarters, which amounts to $527 billion. The full sources and uses can be found here.

Also, as shown in the chart below, this amount of upcoming quarterly issuance will be just shy of the previous record hit in the months of the financial crisis, and represents a dramatic change in the recent direction of declining borrowing.

Source: Reuters

One reason for this surge in Q4 debt issuancem coupld with the low level of borrowing in 3Q suggests the debt ceiling will be a “significant limiting factor on auction sizes” as it doesn’t allow for upsizes or provide space for new tenors, Jefferies economists Ward McCarthy and Thomas Simons write.

They also adds that the borrowing announcement suggests coupon sizes will increase in 4Q, since it’ll be difficult to put together “a feasible auction calendar” that increases borrowing by more than $500b “focused entirely in bills,”

Treasury said it expects to borrow $96b in 3Q, with quarter-end cash balance of


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Trump Axes Obama’s MyRA Retirement Accounts After $70mm Of Taxpayer Funds Wasted

Courtesy of ZeroHedge. View original post here.

During his January 2014 State of the Union address Obama announced the creation of a new financial product that would allow American workers, those without access to retirement accounts anyway, to directly participate in the U.S. Treasury's debt ponzi on a tax-deferred basis. The accounts were cleverly named MyRA and were intended to be a substitute for people who didn't have access to an employee-sponsored 401k…with one little catch…money deposited in the accounts could only be invested in U.S. government bonds. Here's an excerpt from Obama's speech at the time:

Let’s do more to help Americans save for retirement. Today, most workers don’t have a pension. A Social Security check often isn’t enough on its own. And while the stock market has doubled over the last five years, that doesn’t help folks who don’t have 401ks. That’s why, tomorrow, I will direct the Treasury to create a new way for working Americans to start their own retirement savings: MyRA. It’s a new savings bond that encourages folks to build a nest egg. MyRA guarantees a decent return with no risk of losing what you put in. And if this Congress wants to help, work with me to fix an upside-down tax code that gives big tax breaks to help the wealthy save, but does little to nothing for middle-class Americans. Offer every American access to an automatic IRA on the job, so they can save at work just like everyone in this chamber can…

To summarize, a MyRA was, more or less, an IRA without the investing flexibility as you could only invest in a massive government-sponsored ponzi scheme.

Shockingly, as the New York Times points out today, the accounts turned out to be a massive disaster costing taxpayers $70 million, or roughly 2x the amount of money that was invested in the 20,000 accounts that were actually opened and funded. 

President Barack Obama ordered the creation of the so-called starter accounts three years ago, and they became available at the end of 2015. Since then, about 20,000 accounts have been opened, with participants contributing a total of $34 million, according to the Treasury; the median account balance was $500. An additional 10,000 accounts whose owners have not contributed to them


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Charlie Munger On The Power Of Prices

By Rupert Hargreaves. Originally published at ValueWalk.

Here Charlie Munger talks about strong pricing power . Part two of a short series on Charlie Munger’s Human Misjudgment Revisited.

Warren Buffett often speaks about the benefits of a company having an economic moat, are a strong competitive advantage which allows it to keep prices high, profit margins wise and returns to shareholders large. Strong pricing power is a huge part of a business, and for brands to have strong pricing power for a prolonged period is the Holy Grail.

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Charlie Munger

Strong Pricing Power

Strong Pricing Power  – Thoughts From Charlie Munger

Consumers also associate price with quality, and it’s this association that can make or break a firm. As Charlie Munger explained in a talk given at UC Santa Barbara in 2003:

“I have posed at two different business schools the following problem. I say, “You have studied supply and demand curves. You have learned that when you raise the price, ordinarily the volume you can sell goes down, and when you reduce the price, the volume you can sell goes up. Is that right? That’s what you’ve learned?” They all nod yes. And I say, “Now tell me several instances when, if you want the physical volume to go up, the correct answer is to increase the price?” And there’s this long and ghastly pause. And finally, in each of the two business schools in which I’ve tried this, maybe one person in fifty could name one instance. They come up with the idea that occasionally a higher
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Crypto Veteran Explains Bitcoin’s “Software Update” And Recent Price Moves

Courtesy of ZeroHedge. View original post here.

By Valentin Schmid of The Epoch Times

After a spectacular run up to $3,000, Bitcoin prices have been choppy, falling as low as $1,830. However, they reversed and rallied more than $1.000 in just a few days after a software upgrade called Segregated Witness (SegWit) was confirmed, which will allow Bitcoin to perform more transactions and develop different functionalities.

Epoch Times spoke to Bitcoin expert Trace Mayer about SegWit, the problem with the Bitcoin miners, other crypto coins, and expectations of price movement going forward.

Epoch Times: It looks like Bitcoin is getting a major upgrade with Segregated Witness. Can you explain?

Trace Mayer: It lays the platform for Bitcoin to scale and it also lays a big platform for extensibility. We’re going to be able to do all types of things because it is also a fix for something called transaction malleability. By fixing a lot of these things with Segregated Witness, Bitcoin is just going to be so much more. It’s a really, really big upgrade.

There are some vested interests, whether in the Bitcoin community or outside of the Bitcoin community, that have not wanted to see Segregated Witness activated. So, it’s been a long, protracted fight. But it looks like it’s going to get activated and Bitcoin will be on its way.

Epoch Times: Why did it take so long?

Mr. Mayer: It’s been two years in the making. If we had something like a Facebook, or a Google, and let’s say that that you only needed five percent of the voting shares in order to completely stop any future growth or development of the company, well, guess what?

So in the board rooms, you fight all the time. But with proxy voting you can have control of some of these very large corporations and get stuff done with inactive votes or people abstaining. But with Bitcoin, when you want to change something, you have to actively get a very large chunk of votes.

You have to gets votes from users who are using the wallet software, that performs network consensus. You have to get votes from the miners who are processing transactions in blocks. You have to have a


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Minor Selling

Courtesy of Declan

Today's action ranked as bearish cloud cover after last week's bearish reversal. However, as these reversals came in beneath last week's highs the significance of this selling is less. Volume was also lighter.

The S&P triggered a 'sell' in its On-Balance-Volume but it's well above breakout support.
 

The Nasdaq just about claimed a bearish engulfing pattern but held 6,345 support. More worryingly, there is a shift in relative trend strength against Large Caps. Tomorrow is a chance for aggressive long players to take a punt but today's action suggests 6,345 support won't hold.
 

The Russell 2000 didn't stop at its 20-day MA as it may have done after recent selling. Instead, it continues its path towards its 50-day MA but has at least 1,420 support to work with. As with the Nasdaq there is an opportunity for aggressive longs to take a position here; although stop placement is more tricky with 1,400 next support beyond the 50-day MA.
 


As with the Nasdaq, the Nasdaq 100 is resting on (what was) channel support. Technicals are all still net bullish and relative performance against Small Caps is still positive.
 

 

For tomorrow, bulls may have to hold their nose but there is a support opportunity in play which may give day traders – if not swing traders – a chance to profit.

You've now read my opinion, next read Douglas' blog.
 





Mish Mailbag: Why is the Euro Still Rising? When Will it Stop?

Courtesy of Mish.

In response to Tapering All Talk No Action, Expensive Valuations, Duration Risk reader David is wondering about the Euro.

David asks “Can anyone explain why the Euro is still rising in value against US dollar, nonstop? When this will end?”

Hi David, this was expected, at least at this end. Rather than play the Euro which I do not like for numerous reasons, I have been long the pound.

I went long the pound on October 7, after the pound’s big Brexit crash. Peter Atwater had this pertinent Tweet on sentiment about a month earlier.

Investors “bracing for horrific consequences” suggests a major low in the British pound is near. Fear-filled delusion marks the bottom.

— Peter Atwater (@Peter_Atwater) September 10, 2014

I believe that “like” was mine.

I am not sure when I first mentioned being long the pound but I commented on it on December 14, 2016 in Saxo Bank CIO Bets on Weaker Dollar, Cites Blowout Equity Bubble.

Pound Weekly

Both FXStreet and Investing.Com have good chart tools.


Continue reading here…





 
 
 

Zero Hedge

Visualizing The 150 Apps That Power The Gig Economy

Courtesy of ZeroHedge. View original post here.

Go back in time a decade, and you’d have a tough time convincing anyone that they would be “employed” through an app on their phone.

And yet, as Visual Capitalist's Jeff Desjardins explains, in a short period of time, the emergence of the smartphone has enabled the gig economy to flourish into a multi-trillion dollar global market. And by leveraging apps like Uber, Airbnb, and Etsy, it’s estimated that ...



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Phil's Favorites

What's going on with Blue Apron?

By Ilene 

The Blue Apron business model appears, perhaps, flawed. While the service is convenient, I think it would appeal mostly to very busy people who don't have time to shop for food -- but enjoy cooking -- and have enough money that the trade off between paying for food delivery vs. spending time shopping is worth it. Here's the unfortunate stock chart and some numbers from Yahoo:

The company has been losing money, and is projected to lose money again next year. Revenue is projected to decrease in 2019 from the 2018 level, but pick up again in 2020, though still below 2018's revenue. Maybe a larger company that could integrate APRN's services into its existing infrastructure should acquire APRN and save it from its apparent...



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Chart School

Palladium minor cycle bottom

Courtesy of Read the Ticker.

Once again RealVision TV posts another trade idea, long palladium. We shall review it with our RTT cycle tools and parallel channels.







Any trader will be concerned with the supply shock at $1800 which pushed down price quickly. Profit taking maybe, sure! The question, is there more supply out (or more profit taking) there ready to dump on the market, either now or after any minor advance. This why waiting for the 'C' wave of the A-B-C to form over some more time is a good idea, and once done, we want to see solid buying moving price up before acting, after all we do not want to be early or a lonely bull (Richard Wyckoff logic). 

The parallel channel highl...

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Digital Currencies

Cryptocurrencies are finally going mainstream - the battle is on to bring them under global control

 

Cryptocurrencies are finally going mainstream – the battle is on to bring them under global control

The high seas are getting lower. dianemeise

Courtesy of Iwa Salami, University of East London

The 21st-century revolutionaries who have dominated cryptocurrencies are having to move over. Mainstream financial institutions are adopting these assets and the blockchain technology that enables them, in what ...



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Kimble Charting Solutions

Banks Sending Bearish Message To Stocks, Says Joe Friday

Courtesy of Chris Kimble.

Quality bull markets prefer to see Banks stronger than the broad markets or at least keeping up with it. Concerns often crop up when banks reflect relative weakness compared to the S&P.

This chart looks at the Bank Index (BKX) over the past few years, reflecting a falling channel of lower highs and lower lows has taken place inside of falling channel (1). This falling channel has now been in play for the past 15-months.

The index hit the bottom of the channel in December of 2018 and a counter-trend rally took place. The rally off the December lows saw the index hit the top...



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Insider Scoop

Analyst: US Sanctions 'May Not Kill Huawei'

Courtesy of Benzinga.

President Donald Trump signed an executive order Wednesday that limits how "foreign adversaries" conduct business with U.S. companies.

What Happened

The Department of Commerce said China's Huawei and 70 related companies will be included in the "Entity ...



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Biotech

DNA as you've never seen it before, thanks to a new nanotechnology imaging method

Reminder: We are available to chat with Members, comments are found below each post.

 

DNA as you've never seen it before, thanks to a new nanotechnology imaging method

A map of DNA with the double helix colored blue, the landmarks in green, and the start points for copying the molecule in red. David Gilbert/Kyle Klein, CC BY-ND

Courtesy of David M. Gilbert, Florida State University

...



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ValueWalk

More Examples Of "Typical Tesla "wise-guy scamminess"

By Jacob Wolinsky. Originally published at ValueWalk.

Stanphyl Capital’s letter to investors for the month of March 2019.

rawpixel / Pixabay

Friends and Fellow Investors:

For March 2019 the fund was up approximately 5.5% net of all fees and expenses. By way of comparison, the S&P 500 was up approximately 1.9% while the Russell 2000 was down approximately 2.1%. Year-to-date 2019 the fund is up approximately 12.8% while the S&P 500 is up approximately 13.6% and the ...



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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Mapping The Market

It's Not Capitalism, it's Crony Capitalism

A good start from :

It's Not Capitalism, it's Crony Capitalism

Excerpt:

The threat to America is this: we have abandoned our core philosophy. Our first principle of this nation as a meritocracy, a free-market economy, where competition drives economic decision-making. In its place, we have allowed a malignancy to fester, a virulent pus-filled bastardized form of economics so corrosive in nature, so dangerously pestilent, that it presents an extinction-level threat to America – both the actual nation and the “idea” of America.

This all-encompassing mutant corruption saps men’s souls, crushes opportunities, and destroys economic mobility. Its a Smash & Grab system of ill-gotten re...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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