News: Real Estate, Risk, Economics. May 22, 2018

Linking ≠ endorsement. News: Real Estate, Risk, Economics. May 22, 2018

Table of Contents
(Click to sections below.)

1) White House, EPA headed off chemical pollution study

2) Seattle City Council approves lower, compromise head tax; Amazon, Starbucks blast action

3) Real Media: Hot Off The Press, The Third Degree

4) Governor Brown orders control burns and forest thinning ahead of fire season

5) Uber and the labor market

6) Hyman Minsky's Views on the "Welfare Mess"

7) Deadly Greensboro fire is tragic reminder of importance of smoke alarms

8) Five dead from vicious storm as thousands remain without power in Northeast

9) Senate votes for net neutrality return, but major hurdles remain

10) Seattle's Unloosed Monsters Will Kill The Progressive Dream

11) Italy's new populist government plans to give out free money—and tax cuts

12) 50 million American households can't afford basic living expenses

13) We need real tax reform, not just an extension of the Trump-GOP tax bill

14) US Treasury 10-Year Yield Breaks Out, Mortgage Rates Jump to Highest in 7 Years

15) Corporate Buybacks, The Illusion Of Profit And The Looming Disaster For Your Portfolio

16) Credit-Driven Train Crash, Part 1

17) The new Seattle is missing the 'nice'

18) Why Proponents of the Trump-GOP Tax Law Can't Get their Story Straight

19) In the pipeline: Navigating this multifamily sellers' market

20) UN: 68% of the global population will live in cities by 2050

21) Why making money in the stock market could be about to get a lot more difficult

22) New York City poised to join Airbnb crackdown

23) What if Wall Street is waiting for the wrong disaster?

24) Will the New Fed Get Rid of All its Mortgage-Backed Securities? That Seems to be the Plan

25) How public ownership was raised from the grave

26) Don't Fall for Employers' Whining About a 'Skills Gap'

27) The "accounting view" of money: money as equity (Part I)

28) This start-up aims to help almost any homebuyer make an all-cash bid

29) Manufacturer Paying $60M to Settle California Lead Paint Litigation

30) Lightning Strike Causes Fire, $50K Damage in Delaware

31) Landlord in Fatal Maine Apartment Fire to Pay $300K Settlement

32) Lithium Battery Boom Hits Roadblock With Fire-Fearing Cities

33) Convicted contractor con artists back in business in Tampa Bay area

34) Farm bill cuts food stamps without saving money

35) Autonomous Robot Bees Are Being Patented by... Walmart?

36) Before Jumping Into That Hotel Pool or Hot Tub On Your Next Vacation, You Might Want to Check Out This Study

37) Judge orders Eagle Creek fire starter to pay over $36M, acknowledges teen can't pay full sum

38) Bee gone: Scientists turn to technology as declining bee numbers threaten global food security

39) A Battery That Could Change The World

40) Chained CPI Hits Social Security Through Taxation of Benefits

41) Social Security benefits take a hit

42) Tax cut sparks record-setting $178 billion buyback boom

43) Hundreds of homeless people fined and imprisoned in England and Wales

44) EU blocking cities' efforts to curb Airbnb, say campaigners

45) Detectives raid 17 illegal grow houses; bust major marijuana crime ring with ties to China

  1.    White House, EPA headed off chemical pollution study

    If you're going to do proper risk analysis and management, you need to know things like this.

    "Families who have been exposed to emerging contaminants in their drinking water have a right to know about any health impacts, and keeping such information from the public threatens the safety, health, and vitality of communities across our country," Hassan said ....
    ...
    The chemicals at issue in the HHS study have long been used in products like Teflon and firefighting foam, and are contaminating water systems around the country. Known as PFOA and PFOS, they have been linked with thyroid defects, problems in pregnancy and certain cancers, even at low levels of exposure.
    ...
    States have been pleading with EPA for help, and experts say that contamination is so widespread, the chemicals are found in nearly every water supply that gets tested.
    ...
    In 2016, the agency published a voluntary health advisory for PFOA and PFOS, warning that exposure to the chemicals at levels above 70 parts per trillion, total, could be dangerous. One part per trillion is roughly the equivalent of a single grain of sand in an Olympic-sized swimming pool.

    The updated HHS assessment was poised to find that exposure to the chemicals at less than one-sixth of that level could be dangerous for sensitive populations like infants and breastfeeding mothers, according to the emails.
    ...
    Enck, the former EPA official, said she sees one troubling gap in the emails: They make "no mention of the people who are exposed to PFOA or PFOS, there's no health concern expressed here."

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  2.    Seattle City Council approves lower, compromise head tax; Amazon, Starbucks blast action

    The debate over who should pay to solve a housing crisis exacerbated by Seattle's rapid economic growth comes amid skyrocketing rents and rising homelessness. The Seattle region had the third-highest number of homeless people in the U.S. and saw 169 homeless deaths in 2017, The Associated Press reported.

    Didn't the largest of these corporations just get a huge federal tax cut? Are they for public jobs? Are they for a guaranteed living income? Are they for single-payer medical? Are they for the government issuing the money without borrowing?Are they for democracy?

    They complain, but is it simply about how well the city handles money or would they be opposed no matter what?

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  3.    Real Media: Hot Off The Press, The Third Degree

    Okay, so this is rather left-wing in relative terms, but the important thing to grasp is that the companies backing outlets denying global warming caused by carbon burning have been obfuscating. They've known they're causing it. We're all paying for it, and it's going to get worse long before it gets better.

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  4.    Governor Brown orders control burns and forest thinning ahead of fire season News: Real Estate, Risk, Economics. May 22, 2018

    Jerry Brown has made a very wise decision doing this.

    Thinning to the right degree is very smart. Making sure the entire process is environmentally savvy is critical.

    I remember being frowned upon when I suggested that "maybe they should let it burn" concerning a wild fire in Arizona decades ago where the entire effort was to put out the entire fire for the sake of homes in the fire's zone. I knew what I was talking about because I'd studied the issue. I wasn't suggesting not then helping those who would lose their homes, many of them second homes.

    Unfortunately, some proscribed burns have gotten out of control, which gave such burns a bad name.

    The whole "Smoky the Bear" idea when I was growing up was mistaken. So was simply clear cutting. We should have modeled what the forest's did naturally as much as possible and only taken trees highly selectively and not built homes where we couldn't afford to let them burn with the natural burning usually caused by lightening.

    Anyway, I do hope we sequester carbon via soil management and soil building along with reduction and elimination of all excess carbon burning, especially the more unnatural types we use for energy generation, such as coal burning for electricity.

    New construction needs to be wildfire smart. Private land management needs to be as well, which Governor Brown addressed.

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  5.    Uber and the labor market

    I am far from a fan of the libertarian's gig economy, so-called, though I do understand why people use it for earning something or even their full-time work. My preference is for people to receive full benefits and much better pay.

    This article explains that Uber is not what it's been cracked up to be, which I knew all along.

    BTW, I feel the same about the misnomered "sharing economy," though I am a fan of some freedoms in that direction if very well regulated so even the quaint on the outside and inside Bed and Breakfast doesn't ruin the neighborhood. Why I call it misnomered is because the real sharing economy isn't done for compensation. The term was appropriated to harm that cause: the sharing economy (the real one).

    Add your comment. Including the article/link number will help.


  6.    Hyman Minsky's Views on the "Welfare Mess"

    The idea that dignity and social value only comes from "earned success," by which it is meant labor income, is of course the signature view of AEI president Arthur Brooks who, like Minsky, frowns upon welfare payments because they supposedly do not deliver earned success. How capitalists manage to live with themselves despite receiving huge quantities of non-labor income remains mysterious.

    The reason laissez-faire, anti-welfare, anti-democracy capitalists tie dignity to wages is because Marx pointed to the alienation of the employees situation.

    My position is that both sides are wrong about it. Way too much stock is being put into the psychological play of dignity and alienation as used by libertarians and Marxists, respectively.

    Some people glorify the greediest of the greedy, as if those greedy ones are the most worthy.

    Plus, I'm not convince the degree to which Marx was referring to the negative psychological impact of alienation from the product of one's labor as much as drawing attention to the fact that the wage condition is akin to serfdom and earlier, slavery: unjust.

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  7.    Deadly Greensboro fire is tragic reminder of importance of smoke alarms

    According to the Greensboro Fire Department, the apartment in which the fire erupted early Saturday morning had smoke alarms and carbon monoxide alarms but they were not working at the time of the fire.

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  8.    Five dead from vicious storm as thousands remain without power in Northeast

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  9.    Senate votes for net neutrality return, but major hurdles remain

    ... Obama-era rules prevented Internet service providers from blocking or slowing legal traffic, or from being paid for prioritized, faster delivery.

    The replacement rules, which go into effect next month, have a lighter-touch to enforcement. Internet service providers must disclose any blocking, throttling or prioritization of their own content or from their partners. However, they are not prevented from doing so, as did the 2015 rules.

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  10.    Seattle's Unloosed Monsters Will Kill The Progressive Dream

    How did Starbucks make people homeless by revolutionizing retail demand for delicious caffeinated beverages? How did Amazon exacerbate the homeless "crisis" by employing some 45,000 people, paying many of them quite well?

    I really hate articles like this one. How could anyone who has studied the matter or interviewed those with whom he or she disagrees not find out the answers to those questions?

    Anyone studying real estate and homelessness with any seriousness has come up against the issue of gentrification and the negative impacts upon the poor who can't keep pace with rising costs and values and who can't even afford to move elsewhere to seek new employment, especially after the Great Recession caused by deregulation of the banking industry (which deregulation Chuck DeVore and his ilk thought was just great).

    The City does not have a problem with misallocating funds such that a change in allocation would even remotely come close to solving the homelessness in Seattle. The only thing the City can do is raise revenue to provide public remedies, which the libertarian types always, and I mean always, fight. There isn't one economically progressive thing they have ever liked even when they aren't paying for it.

    So Amazon builds its empire by being able to access free roadways upon which it ships it's goods but isn't willing to give back to the community to help house the homeless who are literally dying on the streets?

    If Amazon thinks it's so easy, why doesn't Amazon step up with a plan that will do what the City wants to do but will cost less money.

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  11.    Italy's new populist government plans to give out free money—and tax cuts

    This is a recipe for failure. I don't know where they learned economics, but their plan won't work for reasons cited in the article in the form of questions.

    How are they going to convince their banking industry to create permanent euros to cover the expenses in an affordable manner? Those bankers don't see their interest (no pun intended) lying with this plan against the status quo of the EU technocratic-elite system.

    When they solve that problem, why settle for such a tiny some for the poor to live on.

    If they want to stimulate demand, they must give the poor more money and they must be ready to meet the demand or face rapid inflation.

    So, I've been told that they want to issue mini-BoTs as some sort of parallel currency to the euro. That might work depending upon if it's pegged to the euro or US dollar.

    Here's the idea being floated in August of 2017: https://forexlive.com/news/!/a-proposal- for-a-parallel-currency-in-italy-could-u ndermine-the-euro-20170821

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  12.    50 million American households can't afford basic living expenses

    As income stagnates, millions of Americans are struggling to make ends meet.

    Some 50.8 million households or 43% of households can't afford a basic monthly budget for housing, food, transportation, child care, health care and a monthly smartphone bill ....

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  13.    We need real tax reform, not just an extension of the Trump-GOP tax bill

    ... the permanent provisions include some that raise taxes on low- and middle-income families. One is a slower inflation adjustment, which gradually pushes families into higher income tax brackets and reduces the value of other tax breaks. (This would affect all households, but for the richest households the resulting tax hike would be small compared to what they gain from the corporate tax cut.)

    Even if you're rich or getting there, the tax cuts have harmed, and will continue to harm, the overall economy, which harms you in ways you may not have considered. We can do better.

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  14.    US Treasury 10-Year Yield Breaks Out, Mortgage Rates Jump to Highest in 7 Years

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  15.    Corporate Buybacks, The Illusion Of Profit And The Looming Disaster For Your Portfolio

    What's actually happening in a buyback?

    Let's try a simple example: If a company has 100 shares and makes $100 in profit for 2018, then the company's earnings per share will be $1. Then in 2019, let's say the company makes another $100 in profit, but it also buys back 20 shares, leaving only 80 shares on the market. This means that the company's earnings per share will be reflected as $1.25, despite the company's profits remaining totally stagnant.

    Additionally, the shareholders who remain will see their stake in the company diluted. If you can't quite wrap your head around what's happening here, it's nothing to be ashamed of. The entire mechanism is a bit like something out of the upside-down: Most investors know they should never buy high, but with corporate buybacks (which usually occur during a bull market), that's exactly what's happening— all in an effort to increase a company's earnings pattern.

    The whole process is on steroids due to the Trump corporate-tax cuts. It's smoke and mirrors.

    Add your comment. Including the article/link number will help.


  16.    Credit-Driven Train Crash, Part 1

    There are so many factors happening right now all pointing to recession that nearly everyone who falls into the early camp is now fully on board.

    Add your comment. Including the article/link number will help.


  17.    The new Seattle is missing the 'nice'

    Is it really good for your real-estate investment to be a targeted place for a huge corporation moving to town? Some benefit while others are hit.

    Does the world's richest man really deserve so much public largesse? Someone in an Amazon city is going to get a good paying job there, but many more will be effectively paying their salary through public giveaways.

    Add your comment. Including the article/link number will help.


  18.    Why Proponents of the Trump-GOP Tax Law Can't Get their Story Straight

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  19.    In the pipeline: Navigating this multifamily sellers' market

    I largely agree with this article.

    To build class-B will require new materials and technologies or getting the government to subsidize development and rents.

    Also, the coming recession will further slow home buying as will the tax cuts where poor renters are concerned.

    Add your comment. Including the article/link number will help.


  20.    UN: 68% of the global population will live in cities by 2050

    Who will house them?

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  21.    Why making money in the stock market could be about to get a lot more difficult

    This article sums it up nicely.

    A lot of people have suddenly piled into what I've been saying ever since the Fed announced and then started its tightening.

    I guess the tax cuts really pushed it over the edge, but you'll notice that those cuts aren't blamed much if they're even mentioned at all. That's par for the course: obfuscation.

    I expect it will become so obvious that they'll have to admit it openly quite a bit.

    Add your comment. Including the article/link number will help.


  22.    New York City poised to join Airbnb crackdown

    Read the article, but then ask what it doesn't cover.

    It doesn't discuss that insufficient government results in so many people being driven to increase their incomes by more than shaky means. Some turn to extreme crimes. Most play fast and loose with regulations where they'll simply be shut down if caught and not have to spend time in jail.

    It's a vicious circle: cut taxes, slash government, then ramp up libertarian "solutions" that turn around and cause more people headaches than they had before the government was slashed or underfunded for the sake of deregulation (that rarely results in a net benefit all the way around).

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  23.    What if Wall Street is waiting for the wrong disaster?

    You see, this one covers many factors but only mentions the tax cuts in passing. It doesn't mention the corporate stock-buybacks at all. That's where the corporate tax-cuts have been going, not to raising productivity. The wrong people received the cuts.

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  24.    Will the New Fed Get Rid of All its Mortgage-Backed Securities? That Seems to be the Plan

    If this article is correct, and I'm pretty sure it is, as the unwinding of MBS was also advertised as being down to zero, it will mean that mortgage interest rates will go up quite a bit, unless other factors in the economy cause the Fed to reverse course.

    The Fed doesn't seem to be very interested in doing the right thing as much as it was under Bernanke. When I say right thing, I mean for the sake of the dual mandate but also the secret third mandate of taking care of the banking sector.

    The banking sector, per se, will gain by higher interest rates. however.

    Who will get hurt will be the little people, as usual.

    When there is another downturn, which is coming (it's being caused and I think deliberately), the superrich will be the only ones in a position to buy more things up at pennies on the dollar regardless of interest rates. I think that's the plan.

    Add your comment. Including the article/link number will help.


  25.    How public ownership was raised from the grave

    To improve national ownership in the UK requires taking measures to increase the democratic accountability of state ownership.

    There you go. They nailed it.

    Forget all the "central planning" garbage. Go democratic, as purely democratic as practicable, as in measurable results, not ideology.

    Transparency is the key to it all.

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  26.    Don't Fall for Employers' Whining About a 'Skills Gap'

    ... complaint is perennial. You're hearing it now, when unemployment is 3.9 percent. But you also heard it in the summer of 2014, for example, when unemployment was more than 6 percent. The Manufacturing Institute surveyed manufacturers and found that over 80 percent reported a shortage of skilled workers available for hire — in 2011, when the unemployment rate hovered around 9 percent.

    Why might this issue cost some money to address? Because to the extent this is a problem, the real solution includes training. Businesses are all too often trying to find the perfect candidate — a person who could step into the job on day one and be near peak productivity, without needing to learn anything substantial about the specifics of the job.

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  27.    The "accounting view" of money: money as equity (Part I)

    Oh man oh man, this is exactly what I've been saying since forever. The MMTers hate this, but it's right.

    Thank you, Biagio Bossone and Massimo Costa!

    That said, the use of the expression debt-money when referring to money created upon issuing bonds (debt) is correct and not limited by the points made in the article.

    Money as equity is right when nobody owes anybody. Money as such equity is not merely a commodity. Are you listening Randy Wray? We aren't talking about bananas here.

    I tried to explain this to Randy, but he refused to hear me.

    Those of you who've been reading this blog all along know how often I've told people to ignore the MMTers on this issue. It's just been a senseless distraction that hasn't contributed one positive thing to furthering the rest of their agenda, much of which is headed in the right direction relative to where we are, though they still don't push issuing debt-free, bond-free currency rather then bonds. Until they do, they aren't really with it.

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  28.    This start-up aims to help almost any homebuyer make an all-cash bid

    Clever but expensive ...

    Also, if they sign up enough buyers for the same property ...?

    Add your comment. Including the article/link number will help.


  29.    Manufacturer Paying $60M to Settle California Lead Paint Litigation

    Add your comment. Including the article/link number will help.


  30.    Lightning Strike Causes Fire, $50K Damage in Delaware

    Delaware apartments ...

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  31.    Landlord in Fatal Maine Apartment Fire to Pay $300K Settlement

    Add your comment. Including the article/link number will help.


  32.    Lithium Battery Boom Hits Roadblock With Fire-Fearing Cities

    "A lot of municipalities are waiting to hear what New York is doing," Rogers said.

    Stay abreast of developments and be sure to know what your tenants are doing regarding storage batteries and such, as there are fire risks.

    Add your comment. Including the article/link number will help.


  33.    Convicted contractor con artists back in business in Tampa Bay area

    How can two notorious felons get back in the home improvement business after going to prison for fraud?

    Who's the insurance carrier? What has that carrier been told?

    Add your comment. Including the article/link number will help.


  34.    Farm bill cuts food stamps without saving money

    Spending more time, money, and effort to punish the poor is not the right approach.

    Millions of paying tenants would be financially harmed. That would harm their landlords and everyone who depends on them.

    Add your comment. Including the article/link number will help.


  35.    Autonomous Robot Bees Are Being Patented by... Walmart? News: Real Estate, Risk, Economics. May 22, 2018

    That robot bees are being patented is no surprise at all. However, patenting robot bees shouldn't be allowed unless others can create robot bees and not just patent modifications to one main patent covering robot bees in general. Patenting robot bees would be like patenting computers such that only the first one to patent any computer would have had a lock on all computer manufacturing. Only modifications would have been patentable and anyone wanting to legally make a computer would have had to obtain a license from the holder of the single patent for computers in general. Imagine where that would have led. The idea of manufacturing robot bees is way too obvious to merit a patent covering all robot bees. The idea certainly occurred to me before I saw anything published on the subject. Robot insects have already been developed. Robot bees probably already exist. I haven't checked, as it's just too obvious to create them under the circumstances of massive hive die-offs (colony collapses) due to human caused environmental destruction and reckless pollution.

    Add your comment. Including the article/link number will help.


  36.    Before Jumping Into That Hotel Pool or Hot Tub On Your Next Vacation, You Might Want to Check Out This Study

    Do you own or manage a complex with a pool or pools? Read the linked article. What sort of pool-water testing do you do? What chemicals and other treatments have you researched? Have you considered eliminating the pool or pools altogether? Some tenants might be upset while others glad. Pools can be noisy, and there's certainly added expense, including insurance liability coverage associated with them.

    Add your comment. Including the article/link number will help.


  37.    Judge orders Eagle Creek fire starter to pay over $36M, acknowledges teen can't pay full sum

    Add your comment. Including the article/link number will help.


  38.    Bee gone: Scientists turn to technology as declining bee numbers threaten global food security

    This is a good follow-up on my link above on robot bees.

    Add your comment. Including the article/link number will help.


  39.    A Battery That Could Change The World

    I brought up battery fires in a link above. This is a great follow-up to that.

    It's good to hear so much effort is being put into battery improvements. I believe the improvements will just keep coming until we develop an entire new source of energy that safer and cleaner than anything green we can even imagine right now.

    Add your comment. Including the article/link number will help.


  40.    Chained CPI Hits Social Security Through Taxation of Benefits

    The whole idea with this is to ultimately make Social Security so bad that those who will clamor for completely privatizing it will get more than a hearing. After all, many of them would sell their own grandparents to make more money for themselves.

    Add your comment. Including the article/link number will help.


  41.    Social Security benefits take a hit

    Here's more bad news for your Social-Security-retiree tenants and therefore you.

    Add your comment. Including the article/link number will help.


  42.    Tax cut sparks record-setting $178 billion buyback boom

    Some economists aren't surprised that the early windfall of the tax cuts is going to Wall Street, instead of Main Street. They note that companies have long had access to tons of cash.

    "If they had plenty of cash, you shouldn't really expect having access to more would lead them to invest," said Alan Auerbach, director of Berkeley's Robert D. Burch Center for Tax Policy and Public Finance.

    What's Trump's excuse? Who's pressing him on it?

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  43.    Hundreds of homeless people fined and imprisoned in England and Wales

    Britain is in the worst economic shape it has been in some 200 years thanks to Thatcherism (libertarianism reintroduced by the economic illiterate Margaret Thatcher), and this is what they do to the poor rather than totally reverse needless austerity by simply creating the money needed to house and feed, clothe, educate, employ, etc., everyone.

    Add your comment. Including the article/link number will help.


  44.    EU blocking cities' efforts to curb Airbnb, say campaigners

    "You can still find the pensioner renting out her spare room for a bit of extra cash," Haar said. "But a very substantial proportion are commercial operators, often with multiple listings, making big bucks. It's clearly having an impact on locals' access to affordable housing, and it's pretty hard to see it as a sharing economy."

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  45.    Detectives raid 17 illegal grow houses; bust major marijuana crime ring with ties to China

    Artificially jacking up housing values ...

    Add your comment. Including the article/link number will help.

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