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My favorite is still Paintshop Pro, but I use Photoshop as well.
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PhotoShop here. There's so much cool stuff I haven't even tapped into yet. I'm working on it though. I'm about to get a Wacom tablet, which I've been wanting for a long time.
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If you are serious about your photos, Lightroom 2.0 is your only choice as it has more "photographer centric" features than Photoshop CS3. In other words, this means that Photoshop has the same capabilities, but takes a rocket scientist to tap it and takes more steps to do it than Lightroom.
I used to use Paintshop Pro back in the 3.0 era but seemed that I was learning way too many programs to accomplish the same thing so I switched over to Photoshop 4.0 and never looked back.
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I just use a good camera lol. But i did just get photoshop elements 6 that i will probably be using once i learn how to use it by reading my photoshop elements 6 for dummies book...