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J&J Covid-19 vaccine pause to be reviewed by U.S. panel next week

A U.S. panel will meet again next week to discuss whether the pause on the use of Johnson & Johnson’s Covid-19 vaccine should continue, after delaying a vote on the matter earlier this week.

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J&J COVID-19 vaccine pause to be reviewed by U.S. panel next week

By Carl O’Donnell, Manas Mishra

(Reuters) – A U.S. panel will meet again next week to discuss whether the pause on the use of Johnson & Johnson’s (JNJ.N) COVID-19 vaccine should continue, after delaying a vote on the matter earlier this week.

The U.S. Centers for Disease Control and Prevention (CDC) advisory panel will meet on April 23, a top U.S. health official said on Friday.

The continued pause “will allow additional time to review any additional cases that might come in, and for (the panel) to conduct a complete risk assessment and to evaluate the emerging science,” CDC Director Dr. Rochelle Walensky said during a Friday news conference.

U.S. health regulators recommended earlier this week that use of the J&J vaccine be paused after reports of six cases of rare brain blood clots in women, out of some 7 million people who have received the shotin the United States. read more

The advisory panel on Wednesday called for more data before making a decision on how and whether to resume use of the one-shot vaccine. read more

Walensky said supply of COVID-19 vaccines from Moderna Inc (MRNA.O) and Pfizer Inc (PFE.N) will remain strong, even as administering of J&J’s vaccine remains on hold.

“We continue to work with pharmacies, states and FEMA (the Federal Emergency Management Agency) to make sure the vaccine supply remains robust across the country,” she said.

Johnson & Johnson’s coronavirus disease (COVID-19) vaccines are seen at Northwell Health’s South Shore University Hospital in Bay Shore, New York, U.S., March 3, 2021. REUTERS/Shannon Stapleton

Reuters reported on Friday that rich countries are stocking up on Pfizer/BioNTech and Moderna shots as concerns mount about vaccines from J&J and AstraZeneca Plc (AZN.L). read more

Walensky said she is very concerned about rising U.S. COVID-19 cases driven by the relaxing of state restrictions to curb virus transmission and the spread of more contagious new coronavirus variants of COVID-19.

The U.S. seven-day average daily case count is 69,500, with hospitalizations up 5% to 8%, and daily deaths have increased for the third day in a row, Walensky added.

Our Standards: The Thomson Reuters Trust Principles.

 

Reuters source:

https://www.reuters.com/world/us/us-advisory-committee-meet-next-week-discuss-jj-covid-19-vaccine-2021-04-16

 

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Government

QE By A Different Name Is Still QE

The Fed added Quantitative Easing (QE) to its monetary policy toolbox in 2008. At the time, the financial system was imploding. Fed Chair Ben Bernanke…

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The Fed added Quantitative Easing (QE) to its monetary policy toolbox in 2008. At the time, the financial system was imploding. Fed Chair Ben Bernanke bought $1.5 trillion U.S. Treasury and mortgage-backed securities to staunch a financial disaster. The drastic action was sold to the public as a one-time, emergency operation to stabilize the banking system and economy. Since the initial round of QE, there have been four additional rounds, culminating with the mind-boggling $5 trillion operation in 2020 and 2021.

QE is no longer a tool for handling a crisis. It has morphed into a policy to ensure the government can fund itself. However, as we are learning today, QE has its faults. For example, it’s not an appropriate policy in times of high inflation like we have.

That doesn’t mean the Fed can’t provide liquidity to help the Treasury fund the government’s deficits. They just need to be more creative. To that end, rumors are floating around that a new variation of QE will help bridge potential liquidity shortfalls.

The Sad Fiscal Situation

The Federal government now pays over $1 trillion in interest expenses annually. Before they spend a dime on the military, social welfare, or the tens of thousands of other expenditures, one-third of the government’s tax revenue pays for the interest on the $34 trillion in debt, representing deficits of years and decades past.

There are many ways to address deficits and overwhelming debt, such as spending cuts or higher taxes. While logical approaches, politicians favor more debt. Let’s face it: winning an election on the promise of spending cuts and tax increases is hard. It’s even harder to keep your seat in Congress if you try to enact such changes.   

More recently, the Federal Reserve has been forced to help fund today’s deficits and those of years past. We can debate the merits of such irresponsible behavior all day, but for investors, it’s much more critical to assess how the Fed and Treasury might keep the debt scheme going when QE is not an option.

Borrowing For Deficits

Before spreading rumors about a new variation of QE, let’s review the problem. The graph below shows the widening gap between federal spending and tax receipts. Literally, the gap between the two lines amounts to the cumulative Federal deficit. Instead of plotting deficit data, we prefer outstanding total federal debt as it better represents the cumulative onus of deficits.

treasury deficits expenditures and tax revenues debts

The graph below shows the Treasury debt has grown annually for the last 57 years by about 1.5% more than the interest expense. Such may not seem like a lot, but 57 years of compounding makes a big difference.  

Declining interest rates for the last 40+ years are to thank for the differential. The green line shows the effective interest rate has steadily dropped until recently. Even with the current instance of higher interest rates, the effective interest rate is only 3.00%.

treasury debt

Fiscal Dominance

The Fed has been increasingly pressed to help the U.S. Treasury maintain the ability to fund its debt at reasonable interest rates. In addition to presiding over lower-than-normal interest rates for the last 30 years, QE helps the cause. By removing Treasury and mortgage-backed securities from the market, the market can more easily absorb new Treasury issuance.

Fiscal dominance, as we are experiencing, occurs when monetary policy helps the Treasury fund its debts. Per The CATO Institute:

Fiscal dominance occurs when central banks use their monetary powers to support the prices of government securities and to peg interest rates at low levels to reduce the costs of servicing sovereign debt.

2019 Revisited

In 2019, before the massive pandemic-related deficits, government spending ramped up over the prior few years due to higher spending and tax cuts. In September 2019, the repo markets strained under the pressure of the growing Treasury demands. The banks had plenty of securities but no cash to lend. For more information on the incident and the importance of liquidity in maintaining financial stability, please read our article, Liquidity Problems.

When a bank, broker, or investor can’t borrow money despite being willing to post U.S. Treasury collateral, that is a clear sign that the banking system lacks liquidity. That is exactly what happened in 2019.

The Fed came to the rescue, offering QE and lowering interest rates.

Shortly later, in March 2020, government spending blossomed with the pandemic, and the Fed was quick to help. As we shared earlier, the Fed, via QE, removed over $5 trillion of assets from the financial markets. That amount was on par with the surge of government debt.

The Fed is mandated to manage policy to achieve maximum employment and stable prices. Mandated or not, recent experiences demonstrate the Fed has become the de facto lender to the Treasury, albeit indirectly.

The Fed Is In Handcuffs

While Jerome Powell and the Fed might like to help the government meet their exorbitant funding needs with lower interest rates and QE, they are shackled. Higher inflation resulting from the pandemic and fiscal and monetary policies force them to reduce their balance sheet and keep rates abnormally high.

Unfortunately, as we wrote in Liquidity Problems, the issuance of Treasury debt rapidly drains excess liquidity from the system.

While the Fed hesitates to cut rates or do QE, they may have another trick up their sleeve.

Spreading Rumors

The following is based on rumors from numerous sources about what the Fed and banking regulators may do to alleviate funding pressures and liquidity shortfalls. 

Banks have regulatory limits on the amount of leverage they can employ. The amount is set by the type and riskiness of assets they hold. For instance, U.S. Treasuries can be leveraged more than a loan to small businesses. A dollar of a bank deposit may allow a bank to buy $5 of a Treasury note but only lend $3 to a riskier borrower.

The regulatory structure currently recognizes eight Global Systematically Important Banks (GSIB). They are as follows:  Bank of America, The Bank of New York, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, State Street, and Wells Fargo & Company.

Rumor has it that the regulators could eliminate leverage requirements for the GSIBs. Doing so would infinitely expand their capacity to own Treasury securities. That may sound like a perfect solution, but there are two problems: the banks must be able to fund the Treasury assets and avoid losing money on them.  

BTFP To The Rescue Again

A year ago, the Fed created the Bank Term Funding Program (BTFP) to bail out banks with underwater securities. The program allowed banks to pledge underwater Treasury assets to the Fed. In exchange, the Fed would loan them money equal to the bond’s par value, even though the bonds were trading at discounts to par.

Remember, since 2008, banks no longer have to book gains or losses on assets unless they are impaired or sold.

In a new scheme, bank regulators could eliminate the need for GSIBs to hold capital against Treasury securities while the Fed reenacts some version of BTFP. Under such a regime, the banks could buy Treasury notes and fund them via the BTFP. If the borrowing rate is less than the bond yield, they make money and, therefore, should be very willing to participate, as there is potentially no downside.

The Fed still uses its balance sheet in this scheme, but it could sell it to the public as a non-inflationary action, as it did in March 2023 when the BTFP was introduced.

Summary

The federal government’s escalating debt and interest expenses underscore the challenges posed by prolonged deficit spending. The problem has forced the Fed to help the Treasury meet its burgeoning needs. The situation becomes more evident with each passing day.

The recently closed BTFP program and rumors about leverage requirements provide insight into how the Fed might accomplish this tall task while maintaining its hawkish anti-inflationary policy stance.  

The post QE By A Different Name Is Still QE appeared first on RIA.

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International

IVI starts technology transfer to Biological E. Limited to manufacture oral cholera vaccine for India and global markets

  Credit: IVI IVI will complete the technology transfer by 2025 Oral Cholera Vaccine to be manufactured by Biological E. Limited for India and international…

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Credit: IVI

  • IVI will complete the technology transfer by 2025
  • Oral Cholera Vaccine to be manufactured by Biological E. Limited for India and international markets

 

March 20, 2024, SEOUL, Republic of Korea and HYDERABAD, India — The International Vaccine Institute (IVI), an international organization with a mission to discover, develop, and deliver safe, effective, and affordable vaccines for global health, today announced that it has commenced a technology transfer of simplified Oral Cholera Vaccine (OCV-S) to Biological E. Limited (BE), a leading India-based Vaccines and Pharmaceutical Company.

 

Following the signing of a technology license agreement in November last year, IVI has begun providing the technical information, know-how, and materials to produce OCV-S at BE facilities and will continue to support necessary clinical development and regulatory approvals. IVI and BE entered this partnership during an unprecedented surge of cholera outbreaks worldwide and aim to increase the volume of low-cost cholera vaccine in India as well as the global public market.

 

IVI will complete the technology transfer by 2025 and the oral cholera vaccine will be manufactured for India and international markets by Biological E. Limited.

 

Dr. Jerome Kim, Director General of IVI, said: “In an era of heightened risk of poverty-associated infectious diseases such as cholera, the world needs a sustainable source of high-quality, affordable vaccines and committed manufacturers to supply them. We are pleased to partner with Biological E., a company with a proven history of making life-saving vaccines accessible globally, to address this supply gap and protect communities from this deadly, though preventable, disease.”

 

Ms. Mahima Datla, Managing Director, Biological E. Limited, said: “We are glad to be in collaboration with IVI for the manufacture of simplified Oral Cholera Vaccine. Our efforts are aimed to not only combat the disease but to also be part of a sustained legacy of innovation, collaboration, and health stewardship. Together with IVI, we are happy to be shaping a healthier and more resilient future by making this vaccine accessible globally.”

 

This technology transfer and licensing agreement is the sixth of its kind for IVI, transferring such technology to manufacturers in India, the Republic of Korea, Bangladesh, and South Africa. All these partnerships have led to or seek to achieve, pre-qualification (PQ) from the World Health Organization, a designation that enables global agencies such as UNICEF to procure the vaccine for the global market. BE already has 9 vaccines with WHO PQ in its portfolio, and IVI and BE will pursue WHO PQ for OCV-S as well, following national licensure in India.

 

Dr. Julia Lynch, Director of IVI’s Cholera Program, said: “The cholera situation is dire, and the availability and use of oral cholera vaccine is an essential part of a multifaceted approach to cholera control and prevention, especially as outbreaks increase and the global vaccine supply remains strained. With more manufacturers like BE entering the market, the future supply situation looks strong. IVI remains committed to ensuring the availability of the oral cholera vaccine and to developing new and improved vaccines that are equally safe, effective, and affordable and made around the world, for the world.”

 

OCV-S is a simplified formulation of OCV with the potential to lower production costs while increasing production capacity for current and aspiring OCV manufacturers. IVI’s development of OCV-S and ongoing technology transfers are part of an institutional strategy to confront cholera with 3 main goals: 1) Ensure supply of OCV 2) Improve cholera vaccines 3) Support OCV use and introduction. The Bill & Melinda Gates Foundation has been supporting IVI’s cholera program since 2000 and is funding this latest technology transfer to BE.

 

###

 

About the International Vaccine Institute (IVI)

The International Vaccine Institute (IVI) is a non-profit international organization established in 1997 at the initiative of the United Nations Development Programme with a mission to discover, develop, and deliver safe, effective, and affordable vaccines for global health.

IVI’s current portfolio includes vaccines at all stages of pre-clinical and clinical development for infectious diseases that disproportionately affect low- and middle-income countries, such as cholera, typhoid, chikungunya, shigella, salmonella, schistosomiasis, hepatitis E, HPV, COVID-19, and more. IVI developed the world’s first low-cost oral cholera vaccine, pre-qualified by the World Health Organization (WHO), and developed a new-generation typhoid conjugate vaccine that also achieved WHO prequalification in early 2024.

IVI is headquartered in Seoul, Republic of Korea with a Europe Regional Office in Sweden, an Africa Regional Office in Rwanda, a Country Office in Austria, and a Country and Project Office in Kenya. IVI additionally co-founded the Hong Kong Jockey Club Global Health Institute in Hong Kong and hosts Collaborating Centers in Ghana, Ethiopia, and Madagascar. 39 countries and the WHO are members of IVI, and the governments of the Republic of Korea, Sweden, India, Finland, and Thailand provide state funding. For more information, please visit https://www.ivi.int.

 

 

About Biological E. Limited

Biological E. Limited (BE), a Hyderabad-based Pharmaceuticals & Biologics Company founded in 1953, is the first private sector biological products company in India and the first pharmaceutical company in Southern India. BE develops, manufactures and supplies vaccines and therapeutics. BE supplies its vaccines to more than 130 countries and its therapeutic products are sold in India, the USA and Europe. BE currently has 8 WHO-prequalified vaccines and 10 USFDA approved Generic Injectables in its portfolio. Recently, BE has received Emergency Use Listing (EUL) from the WHO for CORBEVAX®, the COVID-19 vaccine. Recently, DCGI has approved BE’S 14-Valent Pneumococcal Conjugate vaccine.

In recent years, BE has embarked on new initiatives for organizational expansion such as developing specialty injectable products for global markets as a means to manufacture APIs sustainably and developing novel vaccines for the global market.

Please follow us on Facebook, LinkedIn and Twitter

 

 

MEDIA CONTACTS

IVI

Aerie Em, Global Communications & Advocacy Manager
+82 2 881 1386 | aerie.em@ivi.int

 

Biological E. Limited

K. Vijay Amruth Raj
Email: Vijay.Kammari@biologicale.com
www.biologicale.com/news


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Government

Young People Aren’t Nearly Angry Enough About Government Debt

Young People Aren’t Nearly Angry Enough About Government Debt

Authored by The American Institute for Economic Research,

Young people sometimes…

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Young People Aren't Nearly Angry Enough About Government Debt

Authored by The American Institute for Economic Research,

Young people sometimes seem to wake up in the morning in search of something to be outraged about. We are among the wealthiest and most educated humans in history. But we’re increasingly convinced that we’re worse off than our parents were, that the planet is in crisis, and that it’s probably not worth having kids.

I’ll generalize here about my own cohort (people born after 1981 but before 2010), commonly referred to as Millennials and Gen Z, as that shorthand corresponds to survey and demographic data. Millennials and Gen Z have valid economic complaints, and the conditions of our young adulthood perceptibly weakened traditional bridges to economic independence. We graduated with record amounts of student debt after President Obama nationalized that lending. Housing prices doubled during our household formation years due to zoning impediments and chronic underbuilding. Young Americans say economic issues are important to us, and candidates are courting our votes by promising student debt relief and cheaper housing (which they will never be able to deliver).

Young people, in our idealism and our rational ignorance of the actual appropriations process, typically support more government intervention, more spending programs, and more of every other burden that has landed us in such untenable economic circumstances to begin with. Perhaps not coincidentally, young people who’ve spent the most years in the increasingly partisan bubble of higher education are also the most likely to favor expanded government programs as a “solution” to those complaints.

It’s Your Debt, Boomer 

What most young people don’t yet understand is that we are sacrificing our young adulthood and our financial security to pay for debts run up by Baby Boomers. Part of every Millennial and Gen-Z paycheck is payable to people the same age as the members of Congress currently milking this system and miring us further in debt.

Our government spends more than it can extract from taxpayers. Social Security, which represents 20 percent of government spending, has run an annual deficit for 15 years. Last year Social Security alone overspent by $22.1 billion. To keep sending out checks to retirees, Social Security goes begging to the Treasury Department, and the Treasury borrows from the public by issuing bonds. Bonds allow investors (who are often also taxpayers) to pay for some retirees’ benefits now, and be paid back later. But investors only volunteer to lend Social Security the money it needs to cover its bills because the (younger) taxpayers will eventually repay the debt — with interest.

In other words, both Social Security and Medicare, along with various smaller federal entitlement programs, together comprising almost half of the federal budget, have been operating for a decade on the principle of “give us the money now, and stick the next generation with the check.” We saddle future generations with debt for present-day consumption.

The second largest item in the budget after Social Security is interest on the national debt — largely on Social Security and other entitlements that have already been spent. These mandatory benefits now consume three quarters of the federal budget: even Congress is not answerable for these programs. We never had the chance for our votes to impact that spending (not that older generations were much better represented) and it’s unclear if we ever will.

Young Americans probably don’t think much about the budget deficit (each year’s overspending) or the national debt (many years’ deficits put together, plus interest) much at all. And why should we? For our entire political memory, the federal government, as well as most of our state governments, have been steadily piling “public” debt upon our individual and collective heads. That’s just how it is. We are the frogs trying to make our way in the watery world as the temperature ticks imperceptibly higher. We have been swimming in debt forever, unaware that we’re being economically boiled alive.

Millennials have somewhat modest non-mortgage debt of around $27,000 (some self-reports say twice that much), including car notes, student loans, and credit cards. But we each owe more than $100,000 as a share of the national debt. And we don’t even know it.

When Millennials finally do have babies (and we are!) that infant born in 2024 will enter the world with a newly minted Social Security Number and $78,089 credit card bill for Granddad’s heart surgery and the interest on a benefit check that was mailed when her parents were in middle school. 

Headlines and comments sections love to sneer at “snowflakes” who’ve just hit the “real world,” and can’t figure out how to make ends meet, but the kids are onto something. A full 15 percent of our earnings are confiscated to pay into retirement and healthcare programs that will be insolvent by the time we’re old enough to enjoy them. The Federal Reserve and government debt are eating the economy. The same interest rates that are pushing mortgages out of reach are driving up the cost of interest to maintain the debt going forward. As we learn to save and invest, our dollars are slowly devalued. We’re right to feel trapped.  

Sure, if we’re alive and own a smartphone, we’re among the one percent of the wealthiest humans who’ve ever lived. Older generations could argue (persuasively!) that we have no idea what “poverty” is anymore. But with the state of government spending and debt…we are likely to find out. 

Despite being richer than Rockefeller, Millennials are right to say that the previous ways of building income security have been pushed out of reach. Our earning years are subsidizing not our own economic coming-of-age, but bank bailouts, wars abroad, and retirement and medical benefits for people who navigated a less-challenging wealth-building landscape. 

Redistribution goes both ways. Boomers are expected to pass on tens of trillions in unprecedented wealth to their children (if it isn’t eaten up by medical costs, despite heavy federal subsidies) and older generations’ financial support of the younger has had palpable lifting effects. Half of college costs are paid by families, and the trope of young people moving back home is only possible if mom and dad have the spare room and groceries to make that feasible.

Government “help” during COVID-19 resulted in the worst inflation in 40 years, as the federal government spent $42,000 per citizen on “stimulus” efforts, right around a Millennial’s average salary at that time. An absurd amount of fraud was perpetrated in the stimulus to save an economy from the lockdown that nearly ruined itTrillions in earmarked goodies were rubber stamped, carelessly added to young people’s growing bill. Government lenders deliberately removed fraud controls, fearing they couldn’t hand out $800 billion in young people’s future wages away fast enough. Important lessons were taught by those programs. The importance of self-sufficiency and the dignity of hard work weren’t top of the list.

Boomer Benefits are Stagnating Hiring, Wages, and Investment for Young People

Even if our workplace engagement suffered under government distortions, Millennials continue to work more hours than other generations and invest in side hustles and self employment at higher rates. Working hard and winning higher wages almost doesn’t matter, though, when our purchasing power is eaten from the other side. Buying power has dropped 20 percent in just five years. Life is $11,400/year more expensive than it was two years ago and deficit spending is the reason why

We’re having trouble getting hired for what we’re worth, because it costs employers 30 percent more than just our wages to employ us. The federal tax code both requires and incentivizes our employers to transfer a bunch of what we earned directly to insurance companies and those same Boomer-busted federal benefits, via tax-deductible benefits and payroll taxes. And the regulatory compliance costs of ravenous bureaucratic state. The price paid by each employer to keep each employee continues to rise — but Congress says your boss has to give most of the increase to someone other than you. 

Federal spending programs that many people consider good government, including Social Security, Medicare, Medicaid, and health insurance for children (CHIP) aren’t a small amount of the federal budget. Government spends on these programs because people support and demand them, and because cutting those benefits would be a re-election death sentence. That’s why they call cutting Social Security the “third rail of politics.” If you touch those benefits, you die. Congress is held hostage by Baby Boomers who are running up the bill with no sign of slowing down. 

Young people generally support Social Security and the public health insurance programs, even though a 2021 poll by Nationwide Financial found 47 percent of Millennials agree with the statement “I will not get a dime of the Social Security benefits I have earned.”

In the same survey, Millennials were the most likely of any generation to believe that Social Security benefits should be enough to live on as a sole income, and guessed the retirement age was 52 (it’s 67 for anyone born after 1959 — and that’s likely to rise). Young people are the most likely to see government guarantees as a valid way to live — even though we seem to understand that those promises aren’t guarantees at all.

Healthcare costs tied to an aging population and wonderful-but-expensive growth in medical technologies and medications will balloon over the next few years, and so will the deficits in Boomer benefit programs. Newly developed obesity drugs alone are expected to add $13.6 billion to Medicare spending. By 2030, every single Baby Boomer will be 65, eligible for publicly funded healthcare.

The first Millennial will be eligible to claim Medicare (assuming the program exists and the qualifying age is still 65, both of which are improbable) in 2046. As it happens, that’s also the year that the Boomer benefits programs (which will then be bloated with Gen Xers) and the interest payments we’re incurring to provide those benefits now, are projected to consume 100 percent of federal tax revenue.

Government spending is being transferred to bureaucrats and then to the beneficiaries of government spending who are, in some sense, your diabetic grandma who needs a Medicare-paid dialysis treatment, but in a much more immediate sense, are the insurance companiespharma giants, and hospital corporations who wrote the healthcare legislation. Some percentage of every college graduate’s paycheck buys bullets that get fired at nothing and inflating the private investment portfolios of government contractors, with dubious, wasteful outcomes from the prison-industrial complex to the perpetual war machine.

No bank or nation in the world can lend the kind of money the American government needs to borrow to fulfill its obligations to citizens. Someone will have to bite the bullet. Even some of the co-authors of the current disaster are wrestling with the truth. 

Forget avocado toast and streaming subscriptions. We’re already sensing it, but we haven’t yet seen it. Young people are not well-informed, and often actively misled, about what’s rotten in this economic system. But we are seeing the consequences on store shelves and mortgage contracts and we can sense disaster is coming. We’re about to get stuck with the bill.

Tyler Durden Tue, 03/19/2024 - 20:20

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