[GHC] #13429: Optimizer produces Core with an infinite <<loop>>

[GHC]

#13429: Optimizer produces Core with an infinite <<loop>>
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        Reporter:  lehins            |                Owner:  (none)
            Type:  bug               |               Status:  new
        Priority:  normal            |            Milestone:  7.10.4
       Component:  Compiler          |              Version:  8.0.2
      Resolution:                    |             Keywords:
Operating System:  Unknown/Multiple  |         Architecture:
 Type of failure:  Incorrect result  |  Unknown/Multiple
  at runtime                         |            Test Case:
      Blocked By:                    |             Blocking:
 Related Tickets:                    |  Differential Rev(s):
       Wiki Page:                    |
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Comment (by dfeuer):

 I am getting the very strong feeling that the problem has a lot to do with
 `UndecidableInstances`, constraint simplification, or something in that
 general area. Simplifying constraints by hand seems to make the bug go
 away. Removing the `INLINE` annotation seems to do so as well. I created a
 reduced test case, which hopefully will be simpler to work on.

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Ticket URL: <http://ghc.haskell.org/trac/ghc/ticket/13429#comment:11>
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