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'Automatic' IRAs to Fill Retirement Gap
The Street.com ^ | Aug. 12, 2010 | Joe Mont

Posted on 08/12/2010 10:01:10 AM PDT by Clairity

A bill filed by U.S. senators Jeff Bingaman (D-New Mexico) and John Kerry (D-Mass.) would automatically enroll most U.S. workers in individual retirement accounts if their employers don't sponsor a retirement plan.

All automatic IRAs would offer the same three standardized investment options, each to be developed with regulations and fee guidelines issued by the Treasury and Department of Labor. The options would include a "principal preservation fund" (which would include a special Treasury Retirement Bond , the R-Bond, designed for use within an automatic IRA), a "life-cycle" option and an "alternative investment option" that can include a higher concentration of equities.

(Excerpt) Read more at thestreet.com ...


TOPICS: Business/Economy; Extended News; Government; Politics/Elections
KEYWORDS: democrats; forcedsavings; government; ira; iras; obama; regulations; retirement; rothira; savings
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The government will MAKE you save money, you have to take action to opt out.

This article doesn't mention, but other ones do, that the default is a Roth IRA, so you can't even save on taxes. The government will tell you how to invest it, there are only 3 options (see above), with the default investment a US "R-bond", retirement bond

Related article with additional information:

7 Ways the Automatic IRA Would Impact Retirement Savers

We are all too stupid to decide for ourselves, we need the government to force us to save and to take away any personal options of how to invest.

1 posted on 08/12/2010 10:01:11 AM PDT by Clairity
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To: Clairity

I’m sure this one will have a lock box to make sure the money is actually there when you retire /sarc


2 posted on 08/12/2010 10:03:50 AM PDT by neodad (USS Vincennes (CG 49) "Freedom's Fortress")
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To: Clairity

This is really a tax increase. The government will use the money and deposit IOUs into the IRA accounts. Then down the road, they will have to figure how to come up with the money. Let’s get rid of SS and let the people have personal accounts.


3 posted on 08/12/2010 10:05:11 AM PDT by kabar
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To: Clairity

Well they are trying to force Americans to buy HC, Why not go for the retirement mandate.

One of their Wall Street buddies must have come up with them.

Remember the float of Gov getting control of Pension plans. Guess they are serious. If there is money to be stolen the Dums will try to get it.


4 posted on 08/12/2010 10:05:51 AM PDT by Marty62 (marty60)
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To: Clairity
The government will tell you how to invest it, there are only 3 options (see above), with the default investment a US "R-bond", retirement bond.

In other words, this is just another scam, like the Social Security trust fund, to get our hard-earned pay to finance government deficit spending.

5 posted on 08/12/2010 10:06:14 AM PDT by dirtboy
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To: neodad
I’m sure this one will have a lock box to make sure the money is actually there when you retire /sarc

That's an interesting point. Will these accounts consist of real investments, or will they be IOUs whose returns is based on a tracking index? If the latter, we could fund the Social Security Ponzi scheme for another 20 years!

6 posted on 08/12/2010 10:06:37 AM PDT by Pearls Before Swine
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To: neodad

UNEXPECTED, the confiscation of wealth begins.


7 posted on 08/12/2010 10:06:37 AM PDT by DaxtonBrown (HARRY: Money Mob & Influence (See my Expose on Reid on amazon.com written by me!))
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To: Clairity

Oh boy, the D’s behind the names, and the sleazy names themselves gives the laugh to this plan.

These two clowns have never nor can ever do anything creative or beneficial.

Good gawd, folks, they’re members of the stupid - er - ruling class.


8 posted on 08/12/2010 10:06:43 AM PDT by Da Coyote
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To: neodad

And also we can “keep the retirement plan we have now” — just like “we can keep our insurance and doctors we have now” under Obamacare.

The government is taking over our personal finances.


9 posted on 08/12/2010 10:07:15 AM PDT by Clairity ("The United States needs to be not so much loved as it needs to be respected." -- VP Dick Cheney)
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To: Clairity

So they’re basically recreating Social Security by instituting mandatory savings and retirement plans? Right now employees can opt out, however, how long will it be before it is compulsory?


10 posted on 08/12/2010 10:09:15 AM PDT by Jackson57
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To: kabar

“The government will use the money and deposit IOUs into the IRA accounts.”

Exactly — that’s the whole idea, what do you think that US “R-bonds” will be?

They will take the money now, then Obamacare will make sure Seniors don’t live long enough to actually want to use their money.


11 posted on 08/12/2010 10:10:36 AM PDT by Clairity ("The United States needs to be not so much loved as it needs to be respected." -- VP Dick Cheney)
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To: Clairity
I smell a RAT. What is to prevent the government from FORCING you to rollover your private held IRA investments into their government held investments as prelude to stealing everything from you?
12 posted on 08/12/2010 10:13:58 AM PDT by Myrddin
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To: Clairity
The rumors I have been hearing are that they want to seize individual 401(k)s and IRAs and convert them to a Government run pension. See:

ABC News: Movement to Scrap 401(k)s Gains Traction

US News: Would Obama, Dems Kill 401(k) Plans?

13 posted on 08/12/2010 10:14:12 AM PDT by ravingnutter
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To: dirtboy

“In other words, this is just another scam, like the Social Security trust fund, to get our hard-earned pay to finance government deficit spending.”

You hit the nail on the head.

But they are hoping we are too stupid to figure it out.


14 posted on 08/12/2010 10:14:17 AM PDT by Clairity ("The United States needs to be not so much loved as it needs to be respected." -- VP Dick Cheney)
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To: Clairity

How much you want to bet that the government is going to force these IRAs into government bonds? The Feds need more people to buy the debt / bonds so they can continue their quantitative easing program. Got to spread the wealth .... err debt don’t you know.


15 posted on 08/12/2010 10:14:37 AM PDT by taxcontrol
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To: Clairity

Time to go sharpen my pitchfork again and reheat the tar........


16 posted on 08/12/2010 10:17:00 AM PDT by OB1kNOb (My problem with aging is I tend to forget things. Also, I've found that I tend to forget things.)
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To: ravingnutter

The government will manage our money so much better - we can see how fiscally responsible they are... (/sarcasm)

They want to control all aspect of our lives and want us to be completely dependent on the government for our health, lives, financial “security”.


17 posted on 08/12/2010 10:17:07 AM PDT by Clairity ("The United States needs to be not so much loved as it needs to be respected." -- VP Dick Cheney)
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To: Clairity

I am from the government and I am here to help you. (/s)


18 posted on 08/12/2010 10:19:12 AM PDT by TYVets
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To: taxcontrol

“How much you want to bet that the government is going to force these IRAs into government bonds?’

They ARE doing that — gvoernment bonds are the default, they just call them “R-bonds” (retirement bonds).

They are forcing people to loan money to the US government, and later they will figure out a way to NEVER have to pay it back to us.


19 posted on 08/12/2010 10:19:12 AM PDT by Clairity ("The United States needs to be not so much loved as it needs to be respected." -- VP Dick Cheney)
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To: kabar

The reason personal accounts are not sponsored by Democrats is the mere fact they will not control nor have jurisdiction over people’s lives as they do with Social Security.

The same fact holds true to Government workers on all levels (Federal, State and Local). They can collect taxes from the private sector and pay the public sector with ever increasing rates.

This gives the Government leverage over party loyalty and union affiliation as they extort money from the productive to pay for the non-working and the State workers who produce nothing in the way of GDP.

The question comes to necessity, are soldiers, cops, firemen and teachers important? Yes they are, but should we pay for them for life...maybe cops, fire and military as they put their lives on the line...but run-of-the-mill paper pushers in the courthouse or DMV?

I would like all public employees, except cops, prison guards and military, to have 401K’s they contribute to, and based on the FY profit or loss, their employee match is in lockstep with the overall private sector.

Unions killed the auto industry, the airlines and now are killing the government.

Time for reform. Now.


20 posted on 08/12/2010 10:19:43 AM PDT by wac3rd (Somewhere in Hell, Ted Kennedy snickers....)
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To: wac3rd

“Time for reform. Now.”

We have a chance to start, on election day this November — vote out the Dems.

If we don’t stop this communist, dictatorial government train now, there won’t be anything left of our freedoms by 2012.


21 posted on 08/12/2010 10:22:21 AM PDT by Clairity ("The United States needs to be not so much loved as it needs to be respected." -- VP Dick Cheney)
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To: All
More -- the default investment will be in gov bonds, MANAGED by the government:

"One new feature of the new version is a temporary US Treasury bond account that would allow new savers to accumulate up to a certain level without paying administrative costs. Once it reaches that amount, the account would be transferred to private sector management. This eliminates the problem of costly small accounts where a worker's savings are depleted by administrative costs that exceed the earnings on the account."

New Legislation Helps Build Retirement Security

22 posted on 08/12/2010 10:30:52 AM PDT by Clairity ("The United States needs to be not so much loved as it needs to be respected." -- VP Dick Cheney)
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To: OB1kNOb; All
Time to go sharpen my pitchfork again and reheat the tar...

CONGRESS.SYS Corrupted: Re-boot, Abort November 2010? YES NO

CONGRESS Version 11.2010 available soon.

23 posted on 08/12/2010 10:31:27 AM PDT by SloopJohnB (Tea Party like it's 1773!)
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To: Clairity; ding_dong_daddy_from_dumas; stephenjohnbanker; DoughtyOne; FromLori; Gilbo_3; NFHale; ...
RE :”All automatic IRAs would offer the same three standardized investment options, each to be developed with regulations and fee guidelines issued by the Treasury and Department of Labor. The options would include a “principal preservation fund” (which would include a special Treasury Retirement Bond , the R-Bond, designed for use within an automatic IRA)

PROOF DEMS ARE FULL OF S..T: Here we have democrats concerned we are not 'saving for retirement'. Yet to stimulate the economy they keep interest rates at zero (yes, Bush-Greenspan did this too) and as I pinged you with the below, Dems claim to have to tax us so we dont ‘save’ our own money. so they can ‘stimulate’ the economy with it. Peter Schiff lectures coming back to me each day.

REF::”Critics say that this amounts to increasing taxes at a time of high unemployment, and that instead the tax cuts should be extended as a stimulus measure. This overlooks the fact that tax cuts are an inefficient form of stimulus, because many people choose to save their additional income instead of spending it. If the goal is to encourage growth and employment immediately, it would be better to let the tax cuts expire and dedicate some of the increased revenue to real stimulus programs.
NY Times: The Bush Tax Cuts and Fiscal Responsibility comment #24

24 posted on 08/12/2010 10:31:56 AM PDT by sickoflibs ("It's not the taxes, the redistribution is the federal spending=tax delayed")
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To: Clairity

This ain’t a retirement account. Its a TAX.
“You WILL buy our worthless bonds.”


25 posted on 08/12/2010 10:38:11 AM PDT by Little Ray (The Gods of the Copybook Headings with terror and slaughter return!)
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To: kabar

“This is really a tax increase. The government will use the money and deposit IOUs into the IRA accounts. Then down the road, they will have to figure how to come up with the money. Let’s get rid of SS and let the people have personal accounts.”

I agree that this idea is dangerous. The idea of a new government treasury bill is frightening. The inflow of cash will fund even higher spending levels. The treasury bills will be backed by useless government promises, not any wealth creation ability and real assets.

The most dangerous part of the proposal is the idea that the government will provide a return of inflation plus 3 percent. No one can guarantee any return. The private sector can issue bonds but the bonds depend on corporate assets and wealth generation. The government only has taxation power which reduces wealth creation when tax rates become confiscatory.

The annuity idea is just as dangerous. This proposal is an extension of the unsustainable Social Security inflation indexing (CPI-W). Inflation indexing is a large reason that Social Security is not sustainable.

This proposal will provide us with two bankrupt government pension schemes. The second scheme is an attempt to fund the first scheme. The rats claim that you will have property rights on the second scheme. Since a large part of the contributions are not really invested (new Treasury notes), your property rights are not enforceable. Moreover, this scheme will continue to drain private investment funds, the driver of economic growth.


26 posted on 08/12/2010 10:39:46 AM PDT by businessprofessor
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To: Clairity

B.O.H.I.C.A.!!!!


27 posted on 08/12/2010 10:43:00 AM PDT by Don Corleone ("Oil the gun..eat the cannolis. Take it to the Mattress.")
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To: Clairity

All automatic IRAs would offer the same three standardized investment options

-General Motors Stock
-Chrysler Stock
- US Treasuries


28 posted on 08/12/2010 10:44:54 AM PDT by Buckeye McFrog
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To: SloopJohnB

LOL! This is one time I’m looking forward to an updated version. ;-)


29 posted on 08/12/2010 10:49:09 AM PDT by OB1kNOb (My problem with aging is I tend to forget things. Also, I've found that I tend to forget things.)
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To: Clairity

You also left out one other detail, which is understandable since the cretans in DC don’t want anyone to think about it. Once this phoney baloney program actually accrues some serious money, the gov’t will dump it all into the General Fund, just like LBJ did with the SS “Trust Fund”. And you CAN take THAT to the bank! Pun intended.


30 posted on 08/12/2010 10:51:11 AM PDT by Tucker39
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To: Buckeye McFrog

Hey Buckeye!
Your “prediction” would be clever and funny if it weren’t so startlingly realistic........and repulsive!


31 posted on 08/12/2010 10:55:35 AM PDT by Tucker39
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To: Clairity
Fine with me. As long as the leave my current Roth IRAs and 401k the hell alone.

Yet, somehow, I get the feeling that what this looks like on its face is not what is actually underneath the covers. It never is with the 'Rats.

32 posted on 08/12/2010 11:01:32 AM PDT by Bloody Sam Roberts (A fearless person cannot be controlled.)
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To: businessprofessor; All

Outstanding post! Read it folks.

“I agree that this idea is dangerous. The idea of a new government treasury bill is frightening. The inflow of cash will fund even higher spending levels. The treasury bills will be backed by useless government promises, not any wealth creation ability and real assets.

The most dangerous part of the proposal is the idea that the government will provide a return of inflation plus 3 percent. No one can guarantee any return. The private sector can issue bonds but the bonds depend on corporate assets and wealth generation. The government only has taxation power which reduces wealth creation when tax rates become confiscatory.

The annuity idea is just as dangerous. This proposal is an extension of the unsustainable Social Security inflation indexing (CPI-W). Inflation indexing is a large reason that Social Security is not sustainable.

This proposal will provide us with two bankrupt government pension schemes. The second scheme is an attempt to fund the first scheme. The rats claim that you will have property rights on the second scheme. Since a large part of the contributions are not really invested (new Treasury notes), your property rights are not enforceable. Moreover, this scheme will continue to drain private investment funds, the driver of economic growth. “


33 posted on 08/12/2010 11:02:59 AM PDT by stephenjohnbanker (.Go troops! " Vote out RINOS. They screw you EVERY time" Jim Robinson)
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To: Myrddin
I smell a RAT. What is to prevent the government from FORCING you to rollover your private held IRA investments into their government held investments as prelude to stealing everything from you?

The Second Amendment and a country in flames.

One thing governments do not like to deal with is someone who has nothing to lose.

34 posted on 08/12/2010 11:15:11 AM PDT by Gorzaloon (CNN:AP:etc:Today, President Obama's stool was firm and well-formed. One end was slightly pointed. ")
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To: Clairity

I can support this, if it’s created to replace Social Security.


35 posted on 08/12/2010 11:17:23 AM PDT by The Old Hoosier (Right makes might)
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To: Clairity

Time to withdraw all money and keep what you can safe in a mattress or offshore account.

Screw the DemonRATS.


36 posted on 08/12/2010 11:18:49 AM PDT by nagdt ("None of my EX's live in Texas")
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To: Clairity
what do you think that US “R-bonds” will be?

They'll be stored in the cabinet just under the Social Security Trust funds.

37 posted on 08/12/2010 11:25:19 AM PDT by glorgau
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To: Tucker39

plus it gives them real leverage against the free speech rights of corporations.

You wanna run ads against Democrats running for Congress?
Fine. We’ll just dump your stock out of the SuperMegaGiganticGubbermintPension Fund, and see who has the last laugh!


38 posted on 08/12/2010 11:27:27 AM PDT by Buckeye McFrog
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To: sickoflibs

” A bill filed by U.S. senators Jeff Bingaman (D-New Mexico) and John Kerry (D-Mass.) “

Two left wingers, neither of which has ever had a job other than government(and one a giggolo) ae going to tell us about our personal finance.

Uh uh......


39 posted on 08/12/2010 11:31:24 AM PDT by stephenjohnbanker (.Go troops! " Vote out RINOS. They screw you EVERY time" Jim Robinson)
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To: Clairity

This a preliminary move to end the SS system as we know it. It’s not a bad thing as long as workers have their own accounts and have control over where the money goes.

SS will fail, that is a given and privatised accounts will be a reality, there is not a shred of doubt about this.


40 posted on 08/12/2010 11:39:22 AM PDT by 101voodoo
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To: neodad
I’m sure this one will have a lock box to make sure the money is actually there when you retire /sarc

Of course it will, just like all the money confiscated for social security. Now about that bridge I have for sale.
41 posted on 08/12/2010 11:41:33 AM PDT by algernonpj (He who pays the piper . . .)
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To: Gorzaloon
One thing governments do not like to deal with is someone who has nothing to lose.

That's exactly what they will produce if they steal all of the money we've saved for retirement. The dispossessed become exactly the group that Alinsky uses so well. Have nothing. Have nothing to lose. Willing to do anything to change the situation.

42 posted on 08/12/2010 11:44:28 AM PDT by Myrddin
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To: stephenjohnbanker
As Schiff lectures, we need savings and the temporary related recession (to savings) to rebuild our economy long term, but forcing us to save when they are creating the next crash with this repeating monetary policy makes no sense except to win the next election.
43 posted on 08/12/2010 12:15:01 PM PDT by sickoflibs ("It's not the taxes, the redistribution is the federal spending=tax delayed")
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To: sickoflibs; Liz

The only thing Obama is going to win is a “Get out of jail free card “

Well....that and maybe 100 million he stole out of the “stimulus” fund.

Do I believe this? Your damned right I do.


44 posted on 08/12/2010 12:31:49 PM PDT by stephenjohnbanker (.Go troops! " Vote out RINOS. They screw you EVERY time" Jim Robinson)
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To: 101voodoo
This a preliminary move to end the SS system as we know it. It’s not a bad thing as long as workers have their own accounts and have control over where the money goes.

BS. Two Democrats don't set up a system to replace SS. This is clearly another way for the government to raise more revenue. Notice the default fund consists of T-bills.

45 posted on 08/12/2010 12:56:01 PM PDT by kabar
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To: 101voodoo
LOL!!

You must not really understand Democrats...let alone politicians.

46 posted on 08/12/2010 12:57:40 PM PDT by Osage Orange (MOLON LABE)
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To: Clairity
This is a end-around....to taking over EVERYONE'S 401k's.

They've been talking about it for a long time now....

And there's enough morons out there...that think this is a good idea. Even some FReeper's....

47 posted on 08/12/2010 1:00:07 PM PDT by Osage Orange (MOLON LABE)
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To: stephenjohnbanker; Liz
RE :”Well....that and maybe 100 million he stole out of the “stimulus” fund.

That reminds me of my FICA social security trust fund money that they (both parties) spent on food stamps, public school teachers, drugs for seniors, pork projects, more federal government employees, ACORN, the F-22, TSA employees , rebuilding Iraq......

I think there are not enough jails for congresses and the presidents that spent our money under false pretenses.

48 posted on 08/12/2010 1:04:02 PM PDT by sickoflibs ("It's not the taxes, the redistribution is the federal spending=tax delayed")
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To: sickoflibs; Liz

Tents are faster to erect and much cheaper. ask my Sheriff Joe ;-)


49 posted on 08/12/2010 1:10:03 PM PDT by stephenjohnbanker (.Go troops! " Vote out RINOS. They screw you EVERY time" Jim Robinson)
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To: sickoflibs; stephenjohnbanker
There are not enough jails for congresses and the presidents that spent our money under false pretenses.

They "said" they did it "for the children" (/snix).

50 posted on 08/12/2010 1:13:36 PM PDT by Liz
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