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Well lets take the universe of readers one by one. Kindles are not good at library loans (Have nothing gainst Kindles or kindlers) but most of the rest of them are. Purchased books can be read by any electronic reader including the Kindle. What is going to make the difference here is if you deal with Amazon you have a better chance at getting free electronic books or low cost electronic books but the kindle can't do library loans so to get both worlds you will need to chose one of two options:
1) A Kindle
2) Do you have a cell phone already? Simply download and install readers from Amazon and Overdrive.
With the smart phone you can get the free and cheap books from amazon and still also get library books from Overdrive. Seems to me this is the preferred route unless you do not have a cell phone already or have a very basic cell phone in which case the expenses will make the kindle a better option.
The cell phone route also has a disadvantage - it has a very small screen and you will be scrolling all of the time.
So pick your poison.
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