Wednesday, May 2, 2007

This is hugely important – this may precipitate many more events

Chavez pulls out of IMF and World Bank

Venezuela's leader Hugo Chavez has underlined his intention to develop an alternative economic vision for Latin America by pulling his country from the World Bank and the International Monetary Fund - organisations that have long had a controversial role in the region.

He is also to nationalise operational control of four oil field projects currently run by foreign companies.

Though Venezuela has paid off its loans to the two international lending organisations, Mr Chavez's announcement that he intends to quit the organisations is powerfully symbolic. It is likely to lead to other smaller nations to question their membership and demand a greater say in the organisations' policies.

Posted by lvmreader @ 04:26 AM (777 views)
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22 thoughts on “This is hugely important – this may precipitate many more events

  • japanese uncle says:

    The World Bank is not meant for the benefit of the world, exactly as Federal Reserve is not a federal institution at all. Chavez’s decision is quite justifiable from the viewpoint of impartial observers in view of the fact that poverty in the thrid world is actually worsening rather than improving since the foundation of the IMF and the World Bank. Recent incident involving the shameless Wolfowitz thug should of course not help.

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  • Mr Chavez – like him or loath him is doing what any country’s leader would do – faced with mounting world hostility [where oil supply and ownsership is concerned].

    His actions may well in the long term help all countries re-evaluate their relationships with oil – and could prove a catalyst for change in national and regional energy policies – separating energy generation into domestic and economic usage [priorities].

    The UK in particular needs to seriously look at ways it can reduce domestic energy wastage – as well as seek alternative generation for domestic use – whilst moving external risk from buying in oil and gas – solely for domestic power.

    The same could be done for transport. I can see trouble ahead unless we change our ‘paradigm’ – the age of cheap UK energy [from oil and gas] is over – actually it went when North Sea Oil started to go.

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  • I recommend reading “Confessions of an Economic Hit Man” by John Perkins. The reason why Chavez is right to have nothing to do with the IMF and the World Bank is that these organisations are agents of US economic imperialism. It works like this: send Economic Hit Man to resource-rich developing nations, make vastly inflated predictions of economic growth thereby justifying huge loans (from the IMF and World Bank) that the country can never hope to repay, build next-to-useless power-related projects (the construction contracts go, of course, to US companies like Bechtel and Halliburton), suck money out of these countries through interest payments on the loan, further exploit their resources so that they might one day (but never actually do) repay the IMF and the World Bank loans. Chavez was only able to ‘buck the system’ by nationalising and / or properly taxing the oil industry, thereby generating sufficient funds to pay off his loans. Did the US like it? No, and so the CIA tried to orchestrate a coup against him so that they could put in one of their corrupt undemocratic cronies. Sounds familiar? Yes, the US has been doing this consistently since WWII – and we wonder why the world is in such a mess. War on Terror – my ar*e.

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  • Soon to be poorer middle classes will have to look at ridesharing. Heaven forbid. This however will both reduce their costs and domestic fuel usage.

    With higher interest rates and higher mortgage payments, people are going to be looking for any and all ways to save money.


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  • @Harold, I got that book for Christmas.

    If you think about it, it is a large scale version of the mortgage trap.

    I also recommend

    “Petrodollar Warfare”, by William R. Clark
    “The Power of Gold” by Peter L. Bernstein

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  • Petrodollar Warfare, the Euro, the War in Iraq, the possible War in Iran

    Beating Around the Bush By the Bourse
    by Ingmar Lee

    bourse / /n. (also Bourse) a stock exchange, esp. in Europe. ~Canadian
    Oxford Dictionary

    Only bimbos believed Bush when he said it was WMD’s that made him attack,
    invade, occupy and massacre Iraq. Most of us thought it was to steal Iraq’s
    oil, but we were only partly right. What totally terrorized the tyrannical
    Texan tycoon was when Saddam played the oil bourse card in November, 2000.
    When Saddam started selling Iraqi oil in euro’s, he jeopardized greenback
    hegemony as the world’s supreme foreign exchange transaction currency. If
    this brilliant idea catches on, it will trigger the total collapse of the
    USA economy. The oil grab is a sideshow. The main feature is the oil

    The Neocon global domination agenda is engendered by the denomination of
    global oil transactions in greenbacks. America prints out the bucks that
    are required for the purchase of oil, and the world has to produce stuff
    they can sell to get the bucks they need to buy oil. Printing Monopoly
    ‘fiat’ money only costs America the paper and green ink, so the USA dollar
    has been fattened on oil-enriched chicken feed since Tricky Dick delinked
    the buck from the bullion. The oil bourse scheme could so seriously setback
    US suzerainty that Saddam got stomped to smithereens. Krassimir Petrov, who
    teaches international finance in Bulgaria’s American University, warns
    “should the Iranian Oil Bourse gain momentum, it will be eagerly embraced
    by major economic powers and will precipitate the demise of the dollar.”
    Saddam was just the first wavelet in the coming tsunami. On March 20, 2006,
    Iran will start selling oil in euros.

    Here’s what the Bush cabal’s Neocon Global Hegemony Manifesto, written in
    September 2000, has to say:

    “At present the United States faces no global rival. America’s grand
    strategy should be to preserve and extend this advantageous position as far
    into the future as possible. There are, however, potentially powerful
    states [read Europe, China, India] who are dissatisfied with the current
    situation and who wish to change it, if they can, in directions that would
    endanger the relatively peaceful, prosperous and free condition the world
    [read USA] enjoys today. Up to now, they have been deterred from doing so
    by the capability and global presence of American military power [read
    terrorist menace]. But as that power declines, [read currently being
    defeated in Iraq] relatively and absolutely, the happy conditions that
    follow from it will be inevitably undermined.”

    The latest Neocon ramp-up rhetoric for attacking Iran is a dreary
    fearmongering rerun of the same old lies that launched Bush’s disastrous
    Iraq-attack. The same old WMD drumbeat is now rattling to attack and
    destroy Ahmadinejad’s nascent civilian nuclear program. Bush will fail to
    get IAEA support to forward his Iran-sanctions feint to the UN Security
    Council, so there won’t be any UN ‘coalition of the willing.’ Russia and
    China aren’t interested, and Bush’s Ambassador to India, David Mulford, has
    just ruined the nuclear carrot that Bush so carefully waved at India to get
    them to toe the US line. India has its nukes already, and hooking up the
    pipeline with Iran is more to their interest. This all makes a preemptive
    American or Israeli attack all the more likely, and the Neocon’s insane
    desperation is such, that such an attack might just go nuclear.

    Bush has stated that “All options are on the table.The use of force is the
    last option for any president. You know we have used force in the recent
    past to secure our country.” Freaky Dick’s office has tasked STRATCOM to
    draw up a plan which includes a large-scale air assault on Iran using
    conventional and tactical nuclear weapons. Condoleeza Rice says that “time
    had run out for talking to Tehran.” John Bolton says that Bush “has made
    clear that a nuclear Iran is not acceptable.” Newt Gingrich, who won’t rule
    out a run for the presidency in ’08, said, “If we don’t have a very serious
    systematic program to replace the government of Iran, we’re going to live
    in an unbelievably dangerous world. This is 1935 and Mahmoud Ahmadinejad is
    as close to Adolf Hitler as we’ve seen.” Israel’s Defense Minister Shaul
    Mofaz said that Israel was preparing to protect itself if international
    diplomatic efforts failed to convince Iran to give up its nuclear program.

    When the Neocons conquered the White House in 2000, the U.S. surplus was
    approximately $5 trillion. That’s all gone and the domestic deficit now
    stands at somewhere around $500 billion. The world’s largest debtor nation
    owes $8,193,150,090,487.56 as of this morning, and the American debt is
    mushrooming by over a billion a day. Foreigners hold 48 percent of the U.S.
    Treasury bond market, 24 percent of the U.S. corporate bond market and 20
    percent of all U.S. corporations. With “W” walloping US whack like that,
    why in the world would anyone want dollars?

    Here’s how the Neocons hoodwinked and swindled the world:

    From the Third World Traveler website, Sohan Sharma, Sue Tracy and Surinder
    Kumar wrote,

    “Oil can be bought from OPEC only if you have dollars. Non-oil producing
    countries, such as most underdeveloped countries and Japan, first have to
    sell their goods to earn dollars with which they can purchase oil. If they
    cannot earn enough dollars, then they have to borrow dollars from the
    WB/IMF, which have to be paid back, with interest, in dollars. This creates
    a great demand for dollars outside the U.S. In contrast, the U.S. only has
    to print dollar bills in exchange for goods. Even for its own oil imports,
    the U.S. can print dollar bills without exporting or selling its goods. For
    instance, in 2003 the current U.S. account deficit and external debt has
    been running at more than $500 billion. Put in simple terms, the U.S. will
    receive $500 billion more in goods and services from other countries than
    it will provide them. The imported goods are paid by printing dollar bills,
    i.e., “fiat” dollars.”

    Here’s the Neocons worst nightmare:

    China has more than $800 billion reserved in a giant stack of basically
    green, ink-smeared paper. When Iran starts selling its oil in euros, why
    wouldn’t China just go ahead and convert that stack of paper to euros and
    use real money to buy oil instead? In January 2002, Canada unloaded nearly
    20% of its gold stocks in exchange for euros, thereby bringing its euro
    holdings to the equivalent of about US$14 billion. That’s about 42 percent
    of the total US$33 billion in foreign deposits and securities held by the
    government. Just 2 years previous, euros accounted for the equivalent of
    about US$7 billion of Canada’s reserves, only 23 percent of the total. The
    gold sale reduced Canada’s U.S. dollar share to 55 percent from 75 percent.
    Under Hugo Chavez, Venezuela is brokering barter deals for trading oil with
    12 Latin American countries thereby cutting out the USA cut. At the OPEC
    summit in September 2000, Chavez delivered the report of the “International
    Seminar on the Future of Energy.” One of its key recommendations was that
    “OPEC take advantage of high-tech electronic barter and bi-lateral
    exchanges of its oil with its developing country customers.” That would be
    the end of dollar hegemony over OPEC oil transactions.

    The War Resisters League calculates that the cost of the US military runs
    about $643 billion annually. This obscene military expenditure, which
    supercedes the total of all other combined global military expenditures, is
    responsible for 80% of the American debt. When the world stops propping up
    the debt-ridden USA dollar, that will end the Neocon global domination
    project and the world’s worst terrorist menace. This much, “W” clearly
    understands, and so too, apparently, do his quisling war-mongering Democrat
    counterparts. The Neocon oil-mens cabal has an even clearer understanding
    of Peak Oil, and its equally ominous implications for the American economy.
    This quote from Investment Banker Matthew Simmons-a key advisor to the Bush
    Administration and Cheney’s 2001 Energy Task Force and the Council on
    Foreign Relations: “What peaking does mean, in energy terms, is that once
    you’ve peaked, further growth in supply, is over. Peaking is generally,
    also, a relatively quick transition to a relatively serious decline at
    least on a basin by basin basis. And the issue then, is the world’s biggest
    serious question.”

    In this horrific context, it’s not too difficult to understand why the Bush
    Neocon cabal is preparing to risk all to go on a global oil-stealing spree,
    and to attack Iran, perhaps even with nukes. It’s also easy to understand
    the cringing wimp-ass non-response of the Democrats. There’s no way America
    can win, and America’s got everything to lose. As Gavin R. Putland puts it,
    “If this oil-currency-war theory is a delusion, the U.S. administration can
    easily discredit it-by declaring that the USA has no objection if oil
    exports to the Euro Zone are denominated in euros.” The crash of the USA
    economy will wreak global economic catastrophe. Paradoxically, that crash
    is this world’s only hope for evading global ecological catastrophe. We
    should support Iran’s oil bourse. Bring it on!


    Ingmar Lee is a Canadian freelance writer currently living in Pondicherry
    India. He is appalled and embarrassed that Canada has elected a Bush-lackey
    Neocon creep for Prime Minister.

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  • Here is how the housing scam works.

    I, Wall Street Bank, help retail bank to lend you, SUCKER1, some money to buy a house. Now the house is only worth $x, and usually I can only get 25years of mortgage payments out of you at 7% per year. But if I inflate the market, you, SUCKER1, are begging me to lend you $7x to buy the same house (worth only $x, since salaries have not gone up). In just 5 years at 6.25% interest p.a. I will recoup the equivalent of 25 years worth of interest payments, you will be bankrupt and homeless, I repossess the house for somewhere between $100 and $x and then I start all over again with SUCKER2. Here’s the best thing – I can keep you in hock for the rest of your sorry “keeping up with the Joneses” existence.

    I package SUCKER1, SUCKER2, …, SUCKER[n] mortgage payments into a bond and sell them on. I get a fee when I originate the loan, package the loan and ultimately foreclose. And I get to keep the house too. And I have a wage slave in debt for the rest of his/her natural life.

    I cannot lose. I am the BANK.

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  • IVMReader – very nicely put.

    If only I had bought shares in the banks!!

    I wonder if Fidel, at the end of his life, is pushing a little harder knowing that – death being inevitable and imminent – it doesn’t matter if any of the US death squads get to him this time.

    Time to stand up for what is right.

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  • dohousescrashinthewoods says:

    That’s a very dark outlook, Ivmreader!

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  • indiablue19 says:

    There is some extraordinary naivete on show in this discussions and a tendancy to cast all discussion in terms of “black hats” and “white hats.” Not that I expect it to do any good in rounding out the discussion, but much of my youth was spent watching my own father, the chief international engineer of his Company, and his colleagues from the American corporation, FMC, who spent their entire prime of life developing interior resources and fuel for Venezuela and Brazil. The Company was there AT THE REQUEST OF THE VENEZUELAN AND BRASILIAN GOVERNMENTS to develop raw jungle. The people manning the project, who weren’t only Americans mind you, but from places like India, Egypt and Pakistan, felt they were pioneers. They felt they were on the forefront of helping other people, and many of them paid a steep price, suffering for the rest of their lives with yellow fever and malaria, or even dying of dengue fever, despite being immunised.
    A major part of their project consisted of training local tribes’ people in technical skills. The Company also built homes for entire communities and installed decent water outlets, provided modern plumbing and medical facilities. They brought in vehicles of all descriptions and taught the natives how to drive. There were many deep and lasting friendships that evolved from all of this. FMC constructed all sorts of modern facilities, not only in Caracas, but all throught the outlying areas. For Venezuela, it was a revolution, and not of the destructive type.
    When all of this had been underway for a number of years, when there were sufficient conveyors to bring iron ore from the jungles to the docks, boats paddling the Orinoco in regular supply trips to towns and cities, and sufficient pumping stations to keep the oil production steady, when there were many new schools, hospitals, homes and trained workers on hand — the Venezuelan took my Father and all his co-workers and threw them in prison. They were left there for months with no word to their families what had happened and with only bread, wine and water to live on. Fortunately for our family, my Father survived, even with a heart condition. Not so for some others. FMC and all its efforts were nationalised — in the 1970s. This ploy of Venezuela is nothing new. It’s a very old trick cast — just in modern nationalistic clothes. Beware and check your facts.

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  • @DoHousesCrashIntheWoods

    I didn’t mean it to be dark or light. I have just been turned onto this topic over the last 8 years. I feel as if I was walking around blind before.

    These books may be part right, completely right or completely wrong, but they at least can direct us all to look at the other things behind the scenes.
    After all, it wasn’t too long ago that this News Blog focused more on newspaper reports at the expense of analysis of the trigger events behined cheap money supply.

    I only was introduced to Credit Derivatives 4 years ago and then suddenly many things made sense. Before that, I had no clue how it was all held together. Now I have some clue.

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  • @ indiablue19

    Please elaborate on the “naivete”?

    I am sorry to hear what happened to your father. That was a tragedy.

    Is your specific case a complete disproof of what William Perkins or William R. Clark have written? In every empire there are decent, honest people who think they are doing the right thing and the ingrate natives should just allow their wealth to be taken away and learn to know their place.

    Your points could equally be applied to Nazi Germany, Imperial Japan, Fascist Italy or the South African Apartheid regime.

    After all, Mussolini made the trains run on time. Hitler was just trying to make a better world. This reminds me of the Belgian attitudes to Africans in the 1930s. They honestly believed that they were doing Africa a favour.

    “King Leopold’s” ghost tells of a genocide at least as great as those of WW2. Up to 10million (according to some reports) dead due to colonial imperatives?
    It wasn’t all bad, there were some good points.

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  • Looking In says:

    indiablue19 said

    Your perceptions seem to be clouded by the idealisation of your father and what he stood for and what he achieved.This is all very natural and also something we all tend do,but seriously, think of the basic economics here.The simple answer is that every person needs to make money, and the chain goes from the indiginous worker to the migrant worker to the company employee to the shareholders of the company and finally to the government.See the end point?

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  • In support of IVM,

    Also the intro is so so simillar to our situation in the UK, “You know something is not right with the housing market when a family who earns way more then the average cannot afford to buy a decent home to live in.” …….

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  • indiablue19 says:


    Disproving either author wasn’t the goal of my comments in any respect.

    Mr. Perkins has every right to make a second career by decrying his first; many do it. In relation to Mr. Clark’s currency theories, I believe I pointed out in bold print on this forum months ago that the dispute in Iraq wasn’t over weapons, or oil, but over the trading of oil in euros and the intention to create a euro oil bourse, which banner now has been taken up by Iran. The weapon of mass destruction that WAS found, was the clear intention of Hussein’s and a vast stockpile of various specie of currency in his possession.

    In relation to naivete in re: Imperialism, I mention especially the following which you wrote:

    “Your points could equally be applied to Nazi Germany, Imperial Japan, Fascist Italy or the South African Apartheid regime.”

    Interesting the examples you mention, and really instructive in relation to the “naivete” issue. Of course, the most apt example of bloody greed and imperialist warmongering over centuries is Britain. Britain, that is, in Ireland, Hong Kong, India, Pakistan, Kenya, the Sudan, South Africa, the Bahamas, Jamaica, Australia, New Zealand, Kashmir, the United States, Canada, Newfoundland, the Falkland Islands, the Virgin Islands, Uganda, Egypt, Bermuda, Gibralter, Borneo, Palestine, Brunei, Malta, the Gold Coast, Singapore, Sri Landa [Ceylon], Nigeria, Tonga, British Guyana, and so forth.

    How many British people continue to justify how the world clearly benefited from advancements visited on them by the British Empire, and how former and present colonials adore them and continue to reap untold rewards. And on these occasions, I only ask how Wales and Scotland enjoy being “allied” to London — or not.

    Surely there must have been many sad lessons learned in the realm of British domination and imperialism that are never mentioned as examples on this forum, as though the word Imperialism were coined last week to explain the “Neo-Cons”, [so-dubbed by the BBC], rather than the title of most books on the history of Britain. If we are pointing out mistakes, this is a silent form of either gross naivete — or overt hypocrisy. At the least, an error of omission.

    Touring industrial heritage sites here, I’ve learned that many living today in Britain worked in the mines from the age of 14, or were weavers in the mills and workers in the munitions factories as children, and who never had an education or choice. Slavery — is it not? This population of child slaves includes many people I know in northern England who have prospered anyway, and who were accused on this week’s HPC forum of having had it easy — living in the 50s BUBBLE I believe was the terminology, and having had everything easy all their lives. Pure naivete.

    Meanwhile, Slavery [except apparently industrial slavery] was said to have been “abolished,” in the UK nearly two centuries ago, something which I heard celebrated loud and long here last month, highlighting a parliamentary hero called Wilberforce. Many remarked this abolition notably was prior to the the American Civil War and the USA’s abolition of slavery. No one bothers to mention that the British aristocracy funded the Confederate Army in the US as it was benefiting from the continuation of Slavery in America — because they had substantial plantation holdings in the South themselves. More naivete.

    Surely in terms of international theft and deception, the United Kingdom has the most convincing record of inhumanity in modern times and a rather unconvincing record of explaining this away. Thus the new variation in tactics: the ones who most recently lost the ball simply decrying anyone else who picks it up. The ultimate naivete.

    My suggestion is that, rather than attempting to flail in all directions and black as many eyes and find as many new enemies as possible, the forum would pick up the tone of suggesting a different mentality in future for commerce at home and global industrial relations. Not “what is wrong with what has been” but what would make a clear break with the past and its varieties of greed — and forge a future worth having. Otherwise, this biased discussion of the possibilities for the future, done entirely on terms of national interest, promises nothing better than what has preceded.

    For starters, I suggest a global banking system and global currency. Thoughts?

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  • indiablue19, clearly this is an emotional issue.

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  • little professor says:

    Is it just me, or is this not being reported in any mainstream US outlet? I’ve checked CNN, Fox News, New York Times, LA Times… nothing!

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  • indiablue19 says:


    It is an issue of realising that people are entirely convinced, blinkered, and diverted from the issues at hand by anything at all that can be used by the BBC, or anybody else in the media, to abscond with thought, and to present an entirely one-sided rendition of events fraught with accustions. It is an issue of being sick and tired of seeing nations pitted against one another to no purpose, of realising, having lived many places in the world, that everyone is pointing fingers at someone else — the great THEY — rather than seeing history as a series of very similar events and behaviors, only with names of the benefiting protagonists somewhat changed over time. Meanwhile, once the finger pointing has subsided, nothing has changed, nothing is better, just a different group is on top [for the moment] and all the little people are still small and trodden under. I see nothing in the thought that is presented in general geared to make a positive difference. Only further gasps and accusations. If that is emotional, than I am.

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  • indiablue19, true, it is easy to finger-point and blame the Yanks, while forgetting that empire is a very old game indeed. It is also true that the Brits were amongst the worst offenders historically, as the recent bicentenary of the abolition of slavery highlighted. However, with modern technology the capacity for exploitation and environmental destruction (particularly of the South American rainforests) by ruthless multinationals is greater than at any other time. It is incumbent upon us to say that this is wrong, both from a moral and practical standpoint, without equivocation.

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  • indiablue19 says:


    Do you honestly think that Chavez in his present dictatorial activity is worried for a single moment about the environment? Any more than the West is really worried about terrorism? And are we stopping any of the ruthless from doing anything they please? And why not? Perhaps because we are ruled by supra-governmental that are invisible, and always have been. This greed isn’t allied with any country, neo-con or otherwise. They use the flags of every nation to play their games, and always have. This is why the young of the UK are used to a nub and cast aside, homeless and pensionless. Mr Chavez is no patriot, not any more than the rest. And when Chavez is done “saving” Venezuela and the workers, you will find him in his mansion in Caracas counting his Kruggerands, and the peasants be damned. Whatever we may perceive we are saying or doing in his support of his behavior probably has him laughing up both of his sleeves. The Venezuelans I know here in the UK are educated. They aren’t fooled. And they’re not going home to celebrate either.

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  • indiablue19 says:

    Little Professor…..

    If the story is being reported in a nowhere place like Sioux City, Iowa, it must be out on AP and Reuters wires and publicised everywhere in the US —

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