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You Better Watch Out (1980)

Synopsis:
Widely recognized as the best of the Christmas horror efforts, Christmas Evil is the story of a boy who loves Christmas. He is scarred as a boy when he learns that Santa is not real. Throughout the rest of his life, the toy-maker tries to make the Christmas spirit a reality. He becomes obsessed with the behavior of children and the quality of the toys he makes. When he is met with hypocrisy and cynicism, the resulting snap causes him to go on a yuletide killing spree to complete this dark comedic horror.
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