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Combine butter and sugar in bowl of electric mixer and blend until light and fluffy.
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Add eggs one at a time, beating constantly.
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Sift together flour, baking powder, salt, and nutmeg.
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Blend sour cream and bourbon.
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Alternately add flour and sour cream mixture to batter.
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Add pecans.
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Grease bottom and sides of tube or bunt pan.
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Pour in batter and bake at 325 degrees for about one hour and 30 minutes.
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Test cake frequently after first hour and 15 minutes for doneness.
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Let cake cool in pan for 15 minutes before turning out on wire rack.
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To prepare glaze, combine sugar and bourbon.
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Stir while gradually adding water.
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Add only enough water to make a pourable glaze without allowing mixture to become too thin.
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Pour glaze over top of warm cake and let dribble down sides.