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- Position Sizing Of Diversifiers
- Buy Newmont For Dividend Growth And To Ride The Rally In Gold
- Commodity ETFs: Beyond DBC
- The Outlook For Gold Miner ETFs
- Social Media And Mining - Pairs Trading And Inefficient Markets
- Vringo Warrants Offer An Amazing Asymmetrical Trade
- German Court Caves-In To Euro-Zone Hyperinflation
- Well I Didn't See THAT Coming
- HUI-SPX Ratio Aims For Higher Levels
- Ron Paul At The New Orleans Investment Conference
- Precious Metals: Don’t Call It a Comeback Story
- Silver smackdown commencing
- Who is Selling Physical Gold?
- Germany Can Ratify ESM Bailout Fund With Conditions – Gold And Silver Rise In Euros
- Rob McEwen: Gold Should be in Your Portfolio…and It’s Going to $5,000
- German Court Ruling Pushes Euro Higher
- Canadian Exports Collapse, Expect Plunge in GDP; China Factor; US Recession Factor
- Another Look at Unnecessary, Confidence Destroying Dodd-Frank
- Decades-long Geopolitical Strategy in the Oil Patch concerning a Much Bigger War between the US, Russia and China Regarding US Dollar and Gold Price
- latinum hits 5-month high as SA unrest spreads
- 'Desperate' Central Banks Could Benefit Bullion
- Germany Can Ratify ESM Bailout Fund with Conditions
- Is It Peak Silver Redux?
- Gold and Silver Market morning, September 12 2012
- Energy Prices have a Large Impact on Agriculture
- How High Will Gold & Silver Go?
Position Sizing Of Diversifiers Posted: 12 Sep 2012 11:08 AM PDT ![]() A Mr. Richard Feder from Fort Lee, New Jersey writes in and asks:
In years past, I wrote frequently about the role of diversifiers in the portfolios I manage. The above question was left on yesterday's post, which included a quick mention of gold and the reader apparently is familiar enough with this blog to know I prefer a low to mid single digit weighting. So the first point would be to focus on a word in the previous paragraph -- diversifiers. When the market is doing Complete Story » |
Buy Newmont For Dividend Growth And To Ride The Rally In Gold Posted: 12 Sep 2012 10:39 AM PDT By Qineqt: Gold is continuously moving along its upward trajectory, as a top German court extended its support for the new 700 billion Euro bailout fund today. Meanwhile, the Federal Reserve's two day policy meeting is starting from today, and speculators are looking forward to another round of quantitative easing (QE3), which has further uplifted gold's demand as an inflation hedge. Furthermore, the U.S. Dollar has recently hit four-month lows, fuelling gold's demand as a safe haven. In our previous article, we recommended investors to take long positions in Yamana Gold Inc. (AUY), Barrick Gold Corporation (ABX) and Goldcorp Inc. (GG) as a way to play rising gold prices, citing inexpensive valuations, reasonable dividend yields, and potentially large capital gains. Now, we also add Newmont Mining Corp. (NEM) to our portfolio due to its highest dividend yield among gold miners, the dependence of its dividend yield on gold prices, and stable operations Complete Story » |
Posted: 12 Sep 2012 10:34 AM PDT By Tom Lydon: Broad commodity ETFs have rallied since mid-June. While the $6.7 billion PowerShares DB Commodity Index Tracking Fund (DBC) has attracted its fair share of interest, traders may also consider alternative fund strategies. Commodity ETFs provide an added diversification quality to any portfolio. Commodities have historically maintained low correlations to stocks and bonds and have shown high correlations to inflation. The PowerShares DB Commodity Index Tracking Fund follows the DBIQ Optimum Yield Diversified Commodity Index Excess Return Index, which is comprised of futures contracts for 14 different commodities. The ETF has a 0.85% expense ratio. DBC provides exposure to aluminum 4.2%, Brent crude 12.4%, copper 4.2%, corn 5.6%, gold 8.0%, heating oil 12.4%, light crude 12.4%, natural gas 5.5%, RBOB gasoline 12.4%, silver 2.0%, soybeans 5.6%, sugar 5.6%, wheat 5.6% and zinc 4.2%. Futures-based ETFs have to roll contracts to avoid physical delivery of the commodity. If the later-dated contracts are Complete Story » |
The Outlook For Gold Miner ETFs Posted: 12 Sep 2012 10:31 AM PDT By Tom Lydon: Current valuations for gold mining stocks and exchange traded funds are offering opportunity to investors in comparison to the metal itself. As central banks boost their gold holdings, miners will benefit as demand for the precious metal keeps rising. "It's at the point where gold mining stocks are trading at discounts to gold not seen in the past 30 years," Adrian Day, portfolio manager of Day Asset Management said. He notes that gold miners have historically traded at around three or four times book value, but now trade on average at 1.4 times book value. Profits in gold mining shares and ETFs have been compromised as labor and energy costs to extract gold have risen substantially. In turn, the lagging profits are creating more conflict within the industry. Both Barrick Gold and Kinross Gold, two of the industry's largest domestic gold miners, have replaced their CEOs this summer as company Complete Story » |
Social Media And Mining - Pairs Trading And Inefficient Markets Posted: 12 Sep 2012 10:17 AM PDT By David Zurbuchen: You don't always need a particular direction in the market for a good investment opportunity. Sometimes trades can work whether the market is up or down simply because misinformation or mistakes have caused an asset to be mispriced. Over the years we have seen many examples of market pricing errors despite the oft-repeated claims that the market is right if not always efficient. One recent case in point is the ongoing price divergence between the two market leaders in online social networking, LinkedIn (LNKD) and Facebook (FB). Regardless of what you think about the prospects of these two companies, they both face the ultimate challenge of the Internet age: monetizing "eyeballs." It was, after all, the inability of the first wave of dotcom darlings in the late 1990s to generate profits from web traffic that eventually saw the Nasdaq bubble collapse. It seems hard to fathom the prospects of wild Complete Story » |
Vringo Warrants Offer An Amazing Asymmetrical Trade Posted: 12 Sep 2012 10:11 AM PDT By I have been trading for a long time, almost one third of my life. My mental framework has been built up from reading the Market Wizards books by Jack Schwager, and one of the biggest lessons I have learned from all of them is to look for asymmetrical trading opportunities. What are those? Trades where the downside is trounced by the potential upside. A good relevant example might be Dendreon's (DNDN) first FDA ruling a few years ago. In case you missed it, DNDN was trading around $2-$3 with a massive short interest and then had favorable news and popped somewhere between $15-20 on the subsequent squeeze in the following hours. I think Vringo (VRNG) is offering a similar trade setup with an additional perk: possibly underpriced/underappreciated options and warrants. The point is, when a low-dollar stock like Vringo has a large short interest and a big binomial event looming Complete Story » |
German Court Caves-In To Euro-Zone Hyperinflation Posted: 12 Sep 2012 10:06 AM PDT There was yet another "grave defeat" for fiscal/monetary Sanity in the Western world. Germany's Constitutional Court has rubber-stamped the suicidal plan to engage in "unlimited bond-buying" in the Euro-zone (i.e. monetizing debt) in order to temporarily prevent all European bond markets from cascading defaults. The cost of this monetary insanity (and reckless betrayal of the European people) is nothing less than a commitment to hyperinflation. None of Europe's Deadbeat Debtors has any savings (including Germany itself). Thus every euro spent on these extravagant bond-purchases will be printed out of thin air. This "unlimited bond-buying" is apparently also going to extend to soaking-up more of the financial feces which continues to accumulate on the balance sheets of the ultra-fraudulent Big Banks. Thus what we have is a massive increase in the money supply, with 0% going toward any productive economic use, and 100% going toward doing nothing but soaking-up worthless banker-paper. With zero economic benefit from all of this massive money-printing which is on the way; this is pure currency-dilution – and thus ultra-inflationary. As a matter of the simplest arithmetic/logic; with Europe's governments committed to "unlimited" quantities of an ultra-inflationary policy, the only possible result is hyperinflation. What makes this such a devastating defeat for Sanity is that Germany is the one nation in Europe which still possesses a cultural memory of the economic phenomenon known as hyperinflation. This is a result of the German hyperinflation experienced by the Weimar Republic in the 1920's. Despite this episode of history being nearly a century old, the economic carnage and suffering which results from such folly has still been burned into the German psyche, through parents warning their children of the perils of reckless money-printing. As part of this "cultural memory"; Germans alone among all the peoples of Europe still have a strong attachment/affinity for silver. This is because silver is the People's Money. When the German's banker-paper turned into toilet paper in the 1920's; those who had the foresight to swap their banker-paper for silver before that occurred survived. Those who didn't had to rely upon charity…or they simply didn't survive. To see both Germany's highest court and its Traitor Government turn its back on its own people in this manner is especially disheartening to those who thought mass economic suicide could still be averted. With Europe's Traitor Governments colluding to commit this mass-suicide solely to temporarily prop-up the paper empires of the Bank Oligarchs, there is now only one way for the individual peoples of Europe to save themselves – from their own governments. First the people must elect an honest government which puts People before Parasites. Then that government must select "the Iceland option": throw the bankers out, and leave the economic tyranny of the EU. Across the Atlantic, the North American propaganda machine has been steadily softening us up to accept the same commitment to suicide. With the fraudulent Federal Reserve in the midst of yet another "policy meeting"; we're now told to expect more "QE" when they rush for the nearest microphones tomorrow – with the distinct probability of "a new open-ended plan" (i.e. unlimited buying of bonds and other banker feces). Regular readers know that I have been accusing the Federal Reserve (and U.S. government) of already secretly engaging in this policy for the past several years, through counterfeiting U.S. currency to make clandestine bond purchases – in order prop-up prices (and push down interest rates) on U.S. Treasuries. This saves the U.S. government $100's of billions per year in interest rate payments alone, not to mention the "multiplier effect" of sucking those $100's of billions out of (relatively) productive economic uses. The Euro-zone plan provides more implicit validation for my assertion, since these governments are explicitly engaging in this monetary suicide for the sole (stated) purpose of driving down interest rates on their own debts. It is the only brute-force manner in which interest rates on debt can be maintained at such obviously artificial/fraudulent levels. |
Well I Didn't See THAT Coming Posted: 12 Sep 2012 10:00 AM PDT - And what do you do? - I ignore the biggest bubbles in history, ma'am... |
HUI-SPX Ratio Aims For Higher Levels Posted: 12 Sep 2012 09:38 AM PDT
Gold bugs were sent to the woodshed for much of the last year while the regular stock market spent much of its time bulling. This has served two purposes. First the over bullish (gold fever) sentiment profile was cleared out in the precious metals and a over bearish profile was at least partially addressed in broad stocks. This is a potentially excellent setup for people who made the necessary adjustments last year and now await a continuation of a trend that appears to be in its infancy. Let's look at the big picture view of the HUI-SPX ratio, which shows the severity of the gold stock correction vs. the broad stock market.
By trend continuation I mean a follow through to the initial bottoming signals, which are support found at the 50% Fibonacci retrace of the entire bull market (for the ratio) out of 2000, deeply over sold conditions (worse than 2008) registered by the sensitive CCI and STO, which are now above -100 and crossed up respectively. The ratio is at a resistance area and this is a week where a man who manages market perceptions is holding a meeting of the FOMC. So who knows what lay ahead in the micro term? But what I like about the picture is that the panel indicators became so deeply over sold that they rival not the routine over sold condition of 2008, but rather are in the same condition they were in at the start of the major bull market. This at a time when gold has been making higher highs and is above support in relation to crude oil – which affect mining bottom line margins – and most other commodities. ![]()
Gold is in a bull market in ratio to the stock market, which affects stock investors' desire to buy gold stocks.
Was the correction over the last year was something to be afraid of? Well, tuning out the trend followers (whose primary goal is to always appear right) that were calling an end to gold's bull market in favor of equities (6 months into the trend, mind you) what we see above is a beautiful consolidation down to support. We also see a continuation of a series of higher highs and higher lows. The correction over the last year was an opportunity to sell stocks in favor of gold once again. That is of course, unless an intact secular trend is about to end. When gold out performs the stock market, players tend to gravitate to the gold stock sector. Here is a 'big picture' look at the nominal HUI.
In NFTRH we managed the failure of the big picture breakout into the recent major correction by daily and weekly charts. More recently we have been managing what is potentially an important bottom by those same charts. The charts and other tools tell us that the sector is over bought, but constructive to continue to bull going forward. But the monthly chart above gives you an idea of how strong the next leg of the HUI's bull market could be, whether it is engaging now per the current view or later, if the current bottom unexpectedly fails. The red resistance zone is key. The bottom line is that the gold sector did a lot of good, corrective work over the last year and gold looks good technically in relation to other markets, which in turn benefits the gold stock sector. Precious metals are over bought short term, with some signs that argue for caution (notably the CoT structure), but the big picture is positive. Housekeeping: The old blog has been consolidated into the main website (http://www.biiwii.com), where you will find my analysis right on the front page along with a handy link to guest analysis. There you can also sign up for the free (and spam free) eLetter and follow me on Twitter if you wish. |
Ron Paul At The New Orleans Investment Conference Posted: 12 Sep 2012 09:00 AM PDT The New Orleans Investment Conference brings the world's top experts in geopolitics, economics and investments together with today's most sophisticated and active investors. Past speakers have included Lady Margaret Thatcher, novelist Ayn Rand, Dr. Alan Greenspan, Nobel laureates Milton Friedman and F.A. Hayek and other giants of modern history. This year's event, being held from October 24-27, 2012, will feature Sarah Palin, Dr. Charles Krauthammer, Dr. Marc Faber, Rick Santelli, Doug Casey, Peter Schiff, Dr. Stephen Leeb and dozens of other leading authorities. For more information, visit www.neworleansconference.com, or call toll free 800-648-8411.
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Precious Metals: Don’t Call It a Comeback Story Posted: 12 Sep 2012 08:32 AM PDT Gold and silver have been performing like they both have something to prove. While some may be quick to label their rise as a comeback story, investors should keep in mind that the safe-havens never truly lost their glitter. |
Posted: 12 Sep 2012 07:45 AM PDT Looks like people are trading out of paper silver and paper gold and into paper platinum today. |
Posted: 12 Sep 2012 07:34 AM PDT Andy Hoffman |
Germany Can Ratify ESM Bailout Fund With Conditions – Gold And Silver Rise In Euros Posted: 12 Sep 2012 07:27 AM PDT gold.ie |
Rob McEwen: Gold Should be in Your Portfolio…and It’s Going to $5,000 Posted: 12 Sep 2012 07:24 AM PDT from caseyresearch.com: Yesterday in Gold and Silver Gold didn't do a lot on Tuesday, either. The rally that developed in early Far East trading, ran into a seller just before 11:00 a.m. Hong Kong time…which was the same thing that happened during the Monday trading session. From there, the gold price didn't do much until the 8:20 a.m. Eastern Comex open. At that point the dollar index cratered…and gold took off…running into a not-for-profit seller at the London p.m. gold fix which came shortly after 10:00 a.m. in New York. The high tick at the 'fix' was $1,739.10 spot. Keep on reading @ caseyresearch.com |
German Court Ruling Pushes Euro Higher Posted: 12 Sep 2012 07:21 AM PDT from goldmoney.com: Stocks, commodities and the euro have all risen this morning following the German Constitutional Court ruling in favour of German participation in the European Union's new "European Stability Mechanism" (ESM) fund. The €500 billion ESM is designed to help eurozone countries stave off sovereign default. The court stated that the €190bn "ceiling" on German contributions can be only raised by lawmakers, which implies that the bill for German taxpayers could easily run higher. The EURUSD briefly nudged above $1.29 this morning, and looks like it could be in the early stages of a move that takes it back up to around $1.50. Similarly, the Dollar Index has fallen below 80.00 for the first time since early May. With all the talk of the Federal Reserve firing up the printing presses once again, and even German Finance Minister Wolfgang Schaeuble openly describing US government debt as "much too high" and the global economy as being "burdened" by this debt, the buck is coming under pressure. Keep on reading @ goldmoney.com |
Canadian Exports Collapse, Expect Plunge in GDP; China Factor; US Recession Factor Posted: 12 Sep 2012 07:19 AM PDT from globaleconomicanalysis.blogspot.ca: All major Canadian exports including energy, autos, agriculture, forest products and machinery-and-equipment collapsed in the latest report. Canadian analysts are shocked by the news. I sure am not. For my reason, look at happenings in China, a huge recession in Europe, and even a recession in the US that surprisingly few have even figured out yet. The Globe and Mail reports Sharp trade slowdown set to wallop GDP Keep on reading @ globaleconomicanalysis.blogspot.ca |
Another Look at Unnecessary, Confidence Destroying Dodd-Frank Posted: 12 Sep 2012 07:01 AM PDT Former Chairman and CEO of Wells Fargo Bank Dick Kovacevich lays out what caused the 2008 financial crisis. More importantly, he also tells why Congress' answer to it, Dodd-Frank, makes the conditions worse, not better, especially for small business.
http://video.cnbc.com/gallery/?video=3000115498 In the second video below the CNBC Squawk Box crew is joined by Bill Isaac, Fifth Third Bank Chairman and former FDIC Chairman, who agrees that Dodd-Frank was not necessary "I can't imagine being a small bank today under Dodd-Frank. It would be impossible to comply with Dodd-Frank and make any money." – Dick Kovacevich."We have exactly the wrong regulatory policies in place, it's upside down." – Bill Isaac In our view Kovacevich hits nails on heads with his comment about confidence in the second video. See if you agree.
http://video.cnbc.com/gallery/?video=3000114740 Edit to add a third segment. We did not realize that the second video cut off before important commentary by Bill Isaac, who says in clip three: "If we don't do something about Dodd-Frank it's going to destroy the community banking system in the U.S. and that's going to be a shame for all of us. … Dodd-Frank wouldn't have prevented the last crisis, won't prevent the next one – we do need sensible reform and it begins with the regulators. We have too many regulators – too many things drop through the cracks – we do need to have a much stronger, simpler regulatory system."
http://video.cnbc.com/gallery/?video=3000115483 Comment: Support leaders who will repeal ObamaCare and Dodd Frank. Fire those who won't. Source: CNBC |
Posted: 12 Sep 2012 06:29 AM PDT Dominique de Kevelioc de Bailleul: Desperate to print Wiemar-style to fight off the most viscous Kondratiev Winter on record, Federal Reserve Chairman Ben Bernanke may not satisfy 'inflation trade' onlookers at the close of his Jackson Hole speech scheduled Friday... Read |
latinum hits 5-month high as SA unrest spreads Posted: 12 Sep 2012 06:26 AM PDT Typo error at mineweb. ![]() latinum hits 5-month high as SA unrest spreads http://www.mineweb.com/mineweb/view/...ail&id=110649 ![]() http://www.amazon.com/Star-Trek-Deep.../dp/B003P8OC2G |
'Desperate' Central Banks Could Benefit Bullion Posted: 12 Sep 2012 05:14 AM PDT The spot market gold price touched a new six-month high at $1,746 an ounce Wednesday morning, while stocks and the euro also rallied following a ruling by Germany's Constitutional Court cleared the way for the creation of a permanent euro-zone bailout fund. |
Germany Can Ratify ESM Bailout Fund with Conditions Posted: 12 Sep 2012 04:49 AM PDT Gold rallied to a six-month high in dollars after Germany's top court ruled that Germany can ratify the €500 billion ESM bailout fund but with strict conditions. Equities have seen tentative gains but silver is the largest beneficiary, rising above $34/oz. or 1.5% |
Posted: 12 Sep 2012 04:22 AM PDT Those with very deep pockets can drive up the price of just about any commodity, but typically only for a very short amount of time. Unless of course they have access to a virtually unlimited supply of paper money. |
Gold and Silver Market morning, September 12 2012 Posted: 12 Sep 2012 03:00 AM PDT |
Energy Prices have a Large Impact on Agriculture Posted: 12 Sep 2012 02:59 AM PDT Crude Oil Rises on Gulf of Mexico Storm and a Venezuela Refinery Fire. Gold Prices Increased, But Some Base Metals go Flat or Down. From operating farm equipment to the cost of fertilizer, storage, transportation and handling, farms must run on gas, diesel and crude oil. "The Standard & Poor's GSCI gauge of 24 commodities climbed 0.9 percent to 676.27 at 6:10 p.m. Singapore time. The UBS Bloomberg CMCI index of 26 raw materials fell 0.2 percent to 1,594.5234." "Oil climbed the most in a week and gasoline rose to the highest in almost four months as Tropical Storm Isaac strengthened, crimping output in the Gulf of Mexico, and a fire in Venezuela shut part of the world's No. 2 refinery." "Oil for October delivery increased as much as $1.57 to $97.72 a barrel in electronic trading on the New York Mercantile Exchange and was at $97.17 at 9:00 a.m. London time. Front-month prices were up 0.2 percent last week, closing at $96.15 on Aug. 24. Futures are down 1.7 percent this year." "Natural gas rose from the lowest level in two months in New York as Tropical Storm Isaac shut production in the Gulf of Mexico." "Futures advanced as much as 2.4 percent after Isaac moved into the southeast Gulf and was forecast to strengthen into a hurricane. Offshore operators evacuated platforms and rigs in the storm's path, shutting in about 8.2 percent of the region's gas production and 24 percent of its oil output, the Bureau of Safety and Environmental Enforcement said yesterday." "The premium of gasoil, or diesel, to Asian marker Dubai crude rose $1.81 to $21.62 a barrel at 11:20 a.m. Singapore time, according to data from a broker with PVM Oil Associates Ltd. This crack spread, a measure of processing profit, was the widest since April 15 last year. Gasoil swaps for September climbed $1.60, or 1.2 percent, to $133.10 a barrel, PVM said. Prices gained for the fourth time in five days." "Naphtha swaps for September lost 50 cents to $969.75 a metric ton, according to PVM. The petrochemical and gasoline feedstock snapped a two-day rising streak. Naphtha's premium to London-traded Brent crude futures decreased $12.18 to $102.29 a ton, according to data compiled by Bloomberg. The difference is also known as the crack spread." "Copper is set to gain in New York on speculation that policy makers from the U.S. to China, the biggest users, will take more measures to stimulate growth, boosting demand for raw materials." "Gold jumped to a four-month high on speculation that central banks from the U.S. to China will act to spur economic growth and as investment holdings expanded to a record. Silver rose for a sixth day, the best run since January." "Immediate-delivery gold rose as much as 0.4 percent to $1,676.90 an ounce, the most expensive since April 13, and was at $1,674.45 at 2:23 p.m. in Singapore. Prices climbed 3.4 percent last week, the biggest gain since Jan. 27. December- delivery bullion advanced as much as 0.4 percent to $1,679.30 an ounce on the Comex in New York, the highest since April 12." "Spot silver rose as much as 1.6 percent to $31.265 an ounce, the highest level since May 1, and was last at $30.995." "Soybeans rallied to a record as the worst U.S. drought in half a century hurt production in the world's largest grower while export demand increased. Corn and wheat climbed. The contract for November delivery gained as much as 1.7 percent to $17.605 a bushel on the Chicago Board of Trade, and was at $17.5775 at 1:25 p.m. in Singapore. Most-active prices have advanced 46 percent this year." "Corn for December delivery rose as much as 1.2 percent to $8.18 a bushel, and traded at $8.1625. The most-active price, which has climbed 26 percent this year, reached a record $8.49 a bushel on Aug. 10." "December-delivery wheat advanced as much as 1.2 percent to $8.9925 a bushel, and was at $8.9625. The price has gained 37 percent this year." "Palm oil jumped to the highest level in six weeks on speculation the worst U.S. drought in half a century will trim soybean supplies, boosting demand for the tropical oil from Malaysia, the second largest grower." "The November-delivery contract gained as much as 1.7 percent to 3,122 ringgit ($1,004) a metric ton on the Malaysia Derivatives Exchange, the highest level for the most-active contract since July 17, and ended the morning session at 3,112 ringgit. Most-active prices rose 3.6 percent last week." "Rubber rallied to a three-week high on speculation policy makers from the U.S. to China, the biggest user, will add measures to stimulate growth, boosting demand for the commodity used in tires and gloves." "January-delivery rubber surged 3.3 percent to end at 228.6 yen a kilogram ($2,904 a metric ton) on the Tokyo Commodity Exchange, the highest price for the most-active contract since Aug. 2. Futures have declined 13 percent this year." -Christian Schmollinger 8-27-12 Singapore, Bloomberg.net Energy, grains, and precious metals (perhaps even China copper) demand continue to the buy side. Other base metals and some other commodities are flat to down on falling global commerce.
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How High Will Gold & Silver Go? Posted: 12 Sep 2012 02:55 AM PDT |
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