okay, I downloaded thisy thing here:
http://ftp.squeak.org/current_stable/win/Squeak3.9-win32.zip, and then I extracted the zipped folder, now what do I do to create my own blocks?
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midnightleopard, you downloaded the current open-source version of "deep-queak". That's a good choice if you want to go through some of the newer tutorials from the Squeak site (and the free book "Squeak By Example").
If you want to play with the source code of Scratch you need to download the Scratch Source Code from:
http://scratch.mit.edu/pages/source
Please read the instructions carefully, how to set it up (you need to download an additional file and copy the Scratch.exe from your Scratch folder into the folder containing the sources). You can find these instructions on that page under the subtitle "Scratch and Squeak".
To get started I suggest you make yourself aquainted with the Smalltalk syntax. There's an excellent tutorial by John Maloney which I already pointed out in your other thread:
http://static.squeak.org/tutorials/BankAccount.html
Then you might want to start with my own little tutorial on how to create your own blocks:
http://scratch.mit.edu/projects/Jens/75626
There's also another thread by ChrisCrouch explaining how you can produce a cool hack enabling Scratch to clone sprites:
http://scratch.mit.edu/forums/viewtopic.php?id=5179
If at first you don't succeed don't give up. Smalltalk may be a lot easier than other programming languages but it also feels eerily alien to most conventional programmers, and many people find it pretty hard to get used to. Also, it might be wise to try something else (easier) in Smalltalk before setting out to modify a complex application like Scratch.
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Question: Is it possible to make one of the custom blocks the ability to save?

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Why am I not getting this news...?!?!?! Thanks a lot Jens, as always, for you invaluable (and well integrated) additions to Scratch. Just one question. Did you decide it was better no to add the "write to file/read from file" block to normal variable or this was only not to change the behaviour of Scratch variables?
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Stefano, I specifically started experimenting with lists because I was after something which could be used in files. At first I thought about saving / retrieving variables, but I quickly got to the point where I felt this would be only half of what I would really want. With lists you can still read / write single variables, if you just put a single variable into them. That's also the reason why I changed my first four-block design and added more functions for concatenating and parsing lists/files.
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