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Default Merge locks up in word 2003 when saving large files

I tried a word merge that would generate 800 letters and a file size
of
50meg. Word DOES NOT save the file. I use save as; then enter a new
file name; word shows "save as file ...." with the save meter BUT when
save is completed the file soes not exist; the top of the screen where
the saved file name should be when the save is completed still shows
"Letter1" which is the default when you create a merge document.
In order to save the file... I had to break the merge into many (7)
separate files of
about 100 letters and 17meg each to get the job done.

I have 2 gig ram and 42gig of space .. I am running XP with release 2

I wonder if anyone can help... I have even reduces the number of
processes running and still the same issue.

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