Sunday , January 24 2021
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Articles by Yves Smith

Links 1/23/2021

1 day ago

The Cat Laughs Dublin Review of Books (Anthony L)
RIP to This Huge Gigantic Dinosaur Who Was Chilling in Some Mud Slate
A large number of gray whales are starving and dying in the eastern North Pacific PhysOrg (Robert M) 🙁
Thailand Serves Food with Cannabis to Happy Customers VOA (furzy)
Game of Thrones getting another prequel series at HBO with fan-favourite characters Digital Spy (furzy)
Forever Chemicals Are Widespread in U.S. Drinking Water Scientific American (Robert M)
Real-life dystopia? Microsoft’s patent to reanimate dead as ‘chatbots’ has Black Mirror fans worried RT (Kevin W)
#COVID-19
No freebies! Pfizer to charge for ‘extra’ Covid-19 vaccine doses as doctors squeeze vials of every drop to inoculate more people RT (furzy)
Thailand’s ‘ghost’ fishing nets help COVID-19 fight

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Why Does Inequality Produce High Crime and Low Trust?

1 day ago

Yves here. This post by Daniel Nettle, and his underlying paper, focuses on the how desperation drives behavior in societies with high levels of inequality. Critically, Nettle focuses on a key implication of significant inequality: if your economic status slips, it completely upends your life. You can’t afford to send your kids to private school, tutors, and fancy summer camps. Or you have to give up the second home. Or the club memberships. Or the charities and the business opportunities that go with them. Or the dinners out. Or all of the above and move into a smaller home in a different area. In other words, if you fall from your perch, it forces you to rebuild most of your friendships (which shows how shallow friendships are in America, yet another facet of high inequality). So the

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A Healthy Microbiome Builds a Strong Immune System That Could Help Defeat COVID-19

1 day ago

Yves here. So is kimchi the real secret behind South Korea’s Covid success? We have vintage pickles in our back fridge made by my father that we joke will be like Egyptian honey, someone will open the jars in 4000 years and find them to be edible.  I should probably make inroads into them.
By Ana Maldonado-Contreras, Assistant Professor of Microbiology and Physiological Systems, University of Massachusetts Medical School. Originally published at The Conversation
You may not know it, but you have an army of microbes living inside of you that are essential for fighting off threats, including the virus that causes COVID-19.
In the past two decades scientists have learned our bodies are home to more bacterial cells than human ones. This community of bacteria that lives in and on us – called

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Links 1/22/2021

2 days ago

Dear patient readers,
I apologize abjectly for being a bit short on original posts today, although Lambert has a juicy offering launching later in the day. Service crapification (basically all sorts of what ought to be routine stuff taking tons of extra steps and follow up) is one part of what is competing for my time. The other is all sorts of nonsense, like having to send multiple certified letters to a debt collector hounding my mother over an ambulance charge she already paid to dealing with a neighbor who is trying to stymie us cutting branches of his trees that are in my mother’s yard and threatening her phone/power lines. Fortunately, he’s not as good at this as he thinks he is. But dealing with the problem takes time I don’t have and he by design is making it more of an energy

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COVID-19 Is Pushing Migrants Back to Their Home Countries

2 days ago

Yves here. Even though this post is written is techno-speak, it describes yet another mechanism for Covid-19 to create deep distress. Migrants are hit by the loss or reduction of work in their host country. Think of businesses shuttering and cutting hours, or well-off households reducing their use of servants or services. So not only do they and their family members back home lose badly needed income, but when they return, they risk bringing Covid with them. And even if not, they add to the crowding of living space.
It’s easy to declare “Governments should Do Something.” But it’s hard to think that the remedies will be more than band-aids, given how important remittances are to some poor countries.
By Ahmed Mushfiq Mobarak, a Professor of Economics at Yale University with concurrent

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The Next Neoliberal President…

2 days ago

Yves here. Tom Neuberger gives an incisive and not at all cheery take on what is in store with President Biden. One tidbit stuck out: that the rule of thumb in DC is that $1 million in donations buys $1 billion in favors.
No wonder guys in private equity are so rich. The leverage is so much greater. The rule of thumb decades ago at CalPERS was that the price of a $100 million commitment was a steak dinner. Since commitment sizes have gone up over time, if anything, the gearing has increased.
By Thomas Neuburger. Originally published at DownWithTyranny!

Humpty Dumpty can’t be put back together again. Gonna be weird watching them try—gonna be dangerous when they finally realize they can’t, and go looking for scapegoats & distractions.
— Mark Ames (@MarkAmesExiled) January 20, 2021

Amid the

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What Can Sanders Do as Budget Chair? – Rob Johnson

2 days ago

Yves here. We’re oddly in the midst of a Sanders boomlet. Maybe that’s because Sanders is a Washington outsider, an anti-politician who has no interest in currying favor and even admits to not liking to kiss babies. Efforts to elicit Bidengasms as the right response to the end of Trump rule by grandiosity, scape-goating, and flip flop are enough to put anyone in a “pox on both your houses” mood.

In Jewish yoga this pose is: waiting for my wife at Loehmann’s pic.twitter.com/Qik7wsZ0ad
— Chandra Steele (@ChanSteele) January 20, 2021

But Sanders is about to be able to throw his weight around as the Chair of the Senate Budget Committee. Rob Johnson, who many years ago was the Senior Economist to the Senate Budget Committee, explains how its leader can wield influence, not just during the

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Rise of the Superstar Firms: Taking Oligopoly Seriously in Macroeconomics

3 days ago

Yves here. Macroeconomics may not be the root of all evil, but in US policy, it plays a significant role. This article explains that the reason monopoly and oligopoly haven’t been treated as serious issues until the dominance of Google, Amazon et al were blindingly obvious is that…drumroll…no one had been able to develop a tractable macroeconomic model. Gah.
By Xavier Vives, Professor of Economics and Finance and Academic Director of the Public-Private Sector Research Center at IESE Business School. Originally published at VoxEU
The dominance of Big Tech and other ‘superstar’ firms’ has put market power back on the agenda of politicians, as well as in research. But although oligopoly markets have been introduced in macroeconomic and trade models, this is mostly in the context of a very

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Blockbuster Lawsuit Targets Deutsche Bank Executives and Supervisors for Epic Abuses, Value Destruction

3 days ago

It’s hardly a secret that Deutsche Bank has become a standout in the universe of badly managed big banks. But thanks to news flow overwhelm, we’ve been slow to write up an important suit, Rosenfeld v. Achleitner that lays out the misconduct over the last decade and is out to ding the executives and directors, or more accurately, their very fat D&O policies, for the abuses (Paul Achleitner is Deutche’s long-standing and very connected chairman of the board). We’ve embedded both the original complaint and the brief in opposition to the defendants’ Motion to Dismiss. The text of the later filing isn’t that long; the big page count comes from inclusion of all the exhibits.
Rosenfeld v. Achleitner follows broadly the same legal strategy as a set of filings against a series of European

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Ins and Outs of Congressional Review Act and Climate Change Rules

3 days ago

Yves here. This is the sort of post I very much like, since it made me smarter about a government procedure that Trump used actively, the 1996 Congressional Review Act. What surprised me was that Trump was the first President to use it aggressively, and that the Act is vague enough on key points as to be seen as legally grey. Yet Trump’s moves were never challenged in court! So much for Team Dem’s brand commitment to fighting.
By Jan Ellen Spiegel. Originally published at Yale Climate Connections
The obstacles the Trump administration has placed on environmental rulemaking and, by extension, on stemming climate change have been well-documented by organizations from mainstream media outlets to multiple academic institutions.
Those obstacles are numerous, well more than 100 plus a cascade of

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How Capitalism’s Dogged Defenders and Propagandists Shield It From Criticism

4 days ago

Yves here. Even though I am running Richard Wolff’s piece, I do not accept his premise that capitalism is ever and always bad. Capitalism in Japan, where entrepreneurs are revered for creating employment, not for getting rich, performed well until the US forced rapid deregulation on its banks to make the world safer for American investment bankers. Even in Japan’s bust, large companies further narrowed the already-not-large by Western standard gap between entry-level and executive pay to preserve employment levels, the opposite of what you see here. Similarly, the Nordic model also delivered high levels of social services and low levels of inequality until neoliberals had increasing success in eroding it.
What Wolff misses is that democracy and democratically-organized organizations don’t

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Central Bank Machinations with No Exit: ECB Leaks New Thingy, It’s Doing Yield Spread Control

4 days ago

Yves here. Market-minded readers will take interest in Wolf Richter’s sighting of the latest ECB intervention strategy. However, I have to differ with Wolf on his claim that yield spread control by a central bank is unprecedented. The Fed attempted to do that in a clumsy way with QE and was explicit about it. It claimed it was not trying to influence yields but spreads, as in of mortgage bonds (which it was buying) along with Treasuries.
In other words, the Fed was not only trying to lower the long end of the curve but also tighten Fannie and Freddie mortgage spreads, which were pretty much the entire market post crisis. So the Fed was saying one of its big objectives was to goose the housing market by making mortgages cheaper than they would otherwise have been.
Now having said that, as

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The CDC’s Mission Impossible

4 days ago

The Wall Street has a new exclusive story about the incoming head of the CDC, Rochelle Walensky, and her plans to greatly increase vaccination rates and restore faith in the agency.
Dr. Walensky has an impressive background: the recent head of infectious diseases at Mass General, one of the top teaching hospitals in the US, where she was also a member of state advisory panels on Covid policy. Some questioned her elevation due to her lack of public health or CDC experience. Walensky said she was surprised to get the nod and assumed her outsider status was a big reason why.
Dr. Walensky will presumably be implementing the Biden Adminstration’s Covid-19 vaccine plans. Given Dr. Walensky’s not anticipating that she would be offered the leadership of the CDC, one has to assume she was not

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More Jockeying on Kentucky Pension Case, Mayberry v. KKR

6 days ago

A short update on the Mayberry v. KKR, a pathbreaking public pension suit targeting customized hedge funds designed for the sitting duck Kentucky Retirement Systems by Blackstone, KKR, and PAACO. The litigation is on track to becoming a Jarndyce v Jarndyce level case study in the (mis)use of procedure to delay a case. As we recapped right after the new year:
In 2017, eight plaintiffs filed a derivative lawsuit on behalf of the spectacularly underfunded and incompetently/corruptly run Kentucky Retirement Systems, the public pension fund for the State of Kentucky (see former board member Chris Tobe’s Kentucky Fried Pensions for lurid details). The filings alleged breach of fiduciary duty and other abuses by three hedge funds operators, KKR/Prisma, Blackstone, and PAAMCO, in the sale and

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The Merits of Fire Sales and Bailouts in Light of the COVID-19 Pandemic

7 days ago

Yves here. One thing to keep in mind when reading this post on fire sales in times of industry or overall economic distress: in normal times, most acquisitions fail (as in delivered a poor return on capital for the buyer) due to overpaying for the company. And that in turn is the result of how efficient the process of selling public and decent-sized private companies has become. Lots of bidders results in higher prices.
One of the results of overpayment is squeezing hard, perhaps harder than initially planned, to wring out costs. While the authors point out that job losses are greater in fire sales than in conventional acquisitions, they look to be on a par with headcount cuts in troubled businesses.
By Jean-Marie Meier, Assistant Professor of Finance, University of Texas at Dallas and

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Another Warning About Comments

7 days ago

With considerable reluctance, we closed comments for over a week earlier this month as a result of too many readers refusing to adhere to our written site Policies. When we restored them, we explained:
In the past, despite having had to impose more moderation tripwires, the site admins have generally been able to operate in a minimal-intervention mode, with moderators approving most comments and deleting posted comments rarely and with great reluctance.
However, due to an rise in sheepdog-style, talking point-driven commentary and other forms of thread-jacking, we are going to be in zero tolerance mode until readers understand that this site is not the place for mere personal opinion. That includes cheerleading (“+1000”). If you have nothing of substance to add to a comment you like,

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Links 1/16/2021

8 days ago

Dear patient readers,
Many of you expressed concern about Lambert not posting his usual Water Cooler yesterday. Not to worry. He got confused about which day of the week it was.
Left stranded: US military sonar linked to whale beachings in Pacific, say scientists Guardian (David L)
Climate disasters in the US broke records in 2020. Scientists may now know why: Earth was the hottest it has ever been. Busness Insider (Kevin W)
The planet is dying faster than we thought LiveScience (David L)
This Seagrass Traps Marine Plastic Smithsonian (David L)
A Big Science Publisher Is Going Open Access. But at What Cost? Undark (Dr. Kevin)
Hooray (fk):

We are delighted to announce that the 33rd stamp in the US Postal Service Literary Arts series honors Ursula. Stamp release will be later this year,

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Lessons From the 6 January Capitol Insurrection

8 days ago

Yves here. It can’t be said often enough that the apparent success of the Capitol seizure came about because the occupiers pushed on an open door. The mob looked to be 5,000 tops, a number that should have been trivial to keep away or at worst, overwhelm. We’ll have a better idea soon of much muscle these Trump opponents have, although the 24/7 media panic has given them a big boost. However, if no more than 50,000 show up at the Inauguration, they are paper tigers, and it would take over 150,000 to get me concerned.
However, the authors equate Trump radicals with the working class, which strikes me as simplistic. Despite having a lower proportion of college graduates than Clinton/Biden voters,  Trump voters have markedly higher incomes, in 2016, over $10,000 per household, a significant

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Pelosi Removes Katie Porter… Bringing Joy & Gratitude To Every Crooked Bankster On Wall Street

8 days ago

Yves here. I suppose it is not surprising that Nancy Pelosi is stopping to new “step on the poors” lows despite getting Versailles 1788 wake-up calls like having her house and her office vandalized. Pelosi has kicked former law professor Katie Porter off the House Financial Services Committee. Porter has been singularly effective in using hearings to put a spotlight on inequality and bank industry abuses.
Odds are decent that Pelosi’s rebuff is payback for this exchange, which even the Washington Post applauded:

Rep. Katie Porter challenged big bank CEO Jamie Dimon to pay his workers a living wage by literally showing him the math pic.twitter.com/FpzxrIc8Co
— ᴿealfarmacist (@real_farmacist) April 13, 2019

By Howie Klein. Originally published at DownWithTyranny!

Katie Porter has been a

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5 Reasons to Wear a Mask Even After You’re Vaccinated

9 days ago

Yves here. Even though this Kaiser Health News story appears to be getting some good play, I thought the message on continuing mask discipline was so important that it warranted featuring here. I hope you’ll circulate it to friends and family.
In addition, this is an opportune spot to highlight a tweet that appeared in Links a second time. It appears that one recommendation is to secure your mask headband-style if it is not already a headband type mask. I happened to use an N95 mask that was headband style for the first time and found that the fit on the face was much tighter than for the ear-loop type.
I also wondered if readers had any clue as to what the difference is between a procedure mask and a surgical mask. The difference in effectiveness is significant.

Study showing simple

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Links 1/15/2021

9 days ago

The Cat Who Came Back: Patches, Believed Killed In Mudslide, Shows Up 3 Years Later NPR (David L)
‘Fake’ US leg band may get pigeon a reprieve in Australia Associated Press (resilc)

An Eden’s #whale trap feeding in the Gulf of #Thailand. This extraordinary behaviour (where the whale treads water) is thought to have developed because #pollution has made the Gulf of Thailand a hypoxic #environment. pic.twitter.com/OnPur033UR
— Big Blue Ocean Cleanup (@bigbluecleanup) January 14, 2021

YOUR BEES, YOUR HONEY. First ever beehive designed for home beekeeping​ BEEING and Lasso (Robert M). Promising pro-environment products featured at CES.
Animal Planet New York Times (Robert M)
How the famed Arecibo telescope fell—and how it might rise again ScienceMag (Kevin W)
On the Rise of

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Brexit: Wheels Coming Off

9 days ago

We’ve been quiet about Brexit because so many things have been happening on other fronts, and truth be told, because reporting has been thin. That isn’t necessarily due to a lack of newsworthy developments but that getting a good picture would involve things like interviewing haulers and farmers or at least their trade associations, and that means developing new sources, which equals work. But even adverse outcomes for the City are getting surprisingly little notice. Some of that may be Brexit fatigue. But many UK businesses are making surprisingly little noise relative to the pain they are suffering. Is that because they recognize or have been told that the Government simply is not going to petition the EU for waivers any time soon, so they are not wasting the few chips they have?
We are

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Michael Olenick: Nothing Godly About Racism or Fascism: Where Evangelicals Went Way Wrong

9 days ago

Yves here. Michael Olenick’s post on the complicated and very much changed relationship between evangelicals and the Republican party builds on two earlier pieces: The Surprisingly Short Road from Abolitionism to Credit Bureaus and Oneida: The Victorian Free Love Commune that Changed the US.
By Michael Olenick, a research fellow at INSEAD whose recent articles can be found at innowiki.org and Blue Ocean Thinking
I normally research, write, and teach about business along with the occasional consulting gig. During my regular work, I came across a pattern that has ramifications for our modern world, the genesis of evangelical support for the Republican Party and how that’s shifted over time.
Most people know the more mundane part of the story: The Kansas-Nebraska Act became law in 1854

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Will the Senate Confirm Coup Plotter Victoria Nuland?

9 days ago

Yves here. Biden’s nominees have skewed towards the awful, particularly on the foreign policy front. But his plan to install Victoria “Fuck the EU” Nuland at State is a standout. For those of you new to this site and not familiar with Nuland’s sorry history, this post gives an overview of her role in fomenting the coup in Ukraine and in putting relations with Russia on a Cold War footing. The authors encourage readers to call their Senators and urge them to vote against her nomination.
And before you get unduly excited by Biden nominating Gary Gensler to the SEC, I would much rather have seem Gensler at Treasury. Gensler demonstrated at the CFTC that he’s effective and dedicated to combatting abuses by Big Finance. However, his best shot at making the SEC feared and respected again is to

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Near-Term Covid Analyses Point to Risk of Medical System Breakdown, Other Severe Dislocations

10 days ago

Some common cognitive biases impede effective responses to looming dangers like Covid. They are disconcertingly apparent as more and more evidence supports the notion that new strains of Covid, like the UK one spreading in the US, are markedly more infectious. That means (unless the UK strain is milder, which so far does not appear to be the case) we will shortly see a big increase the number of hospitalizations. This will take place when medical systems in many parts of the US are already at the breaking point, with even ambulance crews nearing their physical limits.
Yet rather than get in front of a near and present danger, the authorities and pundits are acting as if they can hold the present course, when that isn’t working very well in the US and UK. All bets are on Magic Covid

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Drought-Stricken Colorado River Basin Could See Additional 20% Drop in Water Flow by 2050

10 days ago

Yves here. In parts of the West, water rights have long been hotly contested. Potable water is the natural resource that is projected to come into serious shortage first. That makes management of resources like the Colorado River of critical importance, yet the bodies responsible for its stewardship are late to come to grips with the impact of perma-droughts
By Jan Ellen Spiegel. Originally published at Yale Climate Connections

Colorado is no stranger to drought. The current one is closing in on 20 years, and a rainy or snowy season here and there won’t change the trajectory.
This is what climate change has brought.
“Aridification” is what Bradley Udall formally calls the situation in the western U.S. But perhaps more accurately, he calls it hot drought – heat-induced lack of water due

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Children’s Hospitals Grapple With Wave of Mental Illness

17 days ago

Yves here. The underlying trends in mental health are already horrific, between the grim outlook for the planet, rising inequality and little class mobility, and falling standards of living for the middle and lower classes. All this is made worse by Covid and as this piece makes clear, is hitting the young particularly hard.
By Carmen Heredia Rodriguez, a reporter at Kaiser Health News. Originally published at Kaiser Health News
Krissy Williams, 15, had attempted suicide before, but never with pills.
The teen was diagnosed with schizophrenia when she was 9. People with this chronic mental health condition perceive reality differently and often experience hallucinations and delusions. She learned to manage these symptoms with a variety of services offered at home and at school.
But the

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MAGA Cosplayers Seize Capitol While Cops Flounder

17 days ago

Calibrating the seriousness of the short-lived occupation of the Capitol by Trump-pumped fanboys is made difficult by the headline elements. A departing President calling for a march on the legislature in a last-ditch effort to stop his electoral loss from being certified. Members of Congress photographed cowering in front of their seats before fleeing to safety. Rioters storming the Capitol, breaking Capitol windows, looting.
What Happened, As Best as We Can Tell Now
The ITV video below gives a good feel for the storming of the building:

Watch @robertmooreitv‘s report from inside the Capitol building as the extraordinary events unfolded in Washington DChttps://t.co/krCQf1uQbx pic.twitter.com/SiWbzF5Nzs
— ITV News (@itvnews) January 6, 2021

I’m old enough to remember the demonstrations

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Coming Attraction: IPCC’s Upcoming Major Climate Assessment

17 days ago

Yves here. “Attraction” isn’t exactly the word I’d use for the IPPC climate reports due out in 2021 and 2022, unless you are the sort that enjoys renderings of a freight train bearing down on you. However, for climate change activists, the IPPC studies are critical rallying points, both for reinforcing the urgency of taking action and for getting behind some (many?) of their recommendations.
By Bob Henson. Originally published at Yale Climate Connections
Despite the speed bump posed by the COVID-19 pandemic, the Intergovernmental Panel on Climate Change is rolling toward completion of its Sixth Assessment Report, the latest in a series that began in 1990.
IPCC’s assessments, produced by many hundreds of scientists volunteering countless hours, have long been the world’s most definitive

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“Build Back Better” Needs an Agenda for Upward Mobility

17 days ago

Yves here. While voters should try to get politicians to live up to their campaign promises, Joe Biden has already made clear that his should be taken as nothing more than hot air. We took a quick pass at his electoral promise about what he’d do about Covid, which included substantial income support and rent relief, to his post victory massive retreat. “Build Back Better” is such lame phrasemaking that it signals that it was never meant to be taken seriously.
Nevertheless, Bill Lazonick, Philip Moss, and Joshua Weitx perform a useful service in demanding that Biden address income inequality and providing some ideas as to how to go about it.
By William Lazonick, Professor of Economics, University of Massachusetts Lowell and President, The Academic-Industry Research Network; Philip Moss,

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