Could it be a software-handshake (ctrl-s, ctrl-q) problem with the terminal program? Could it be a buffer full problem?
Try different handshake settings. Try a different serial comm program. Perhaps that program is sending a crtl-s (XOFF) to the kindle at that point (after a certain number of characters have been received), making the kindle output "pause"... Try typing a crtl-q (XON) at that point to see if it continues.
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