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In the jar of a blender, combine the water and cashews. Blend mixture at high speed until completely smooth and no bits of nuts remain. Add the nutritional yeast, cornstarch, flour, garlic, onion, smoked and regular paprika and salt and blend until smooth. Transfer the mixture to a large saucepan and place over medium heat. Bring sauce to a simmer, whisking continuously. Once mixture comes to a simmer, reduce heat slightly and cook, whisking continuously until thickened, 3 to 5 minutes. Whisk in the margarine. If sauce is too thick, add a little additional water to thin.
Use the sauce right away, or whisk it periodically until its cool. This will keep a skin from forming on top of the sauce.
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