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Kate believes Larry is still alive. They have never gotten an official death report, but rather, he disappeared while flying. She believes he is alive somewhere and will come home. We learn later that Kate knows something about the family secret (or at least intuits it) and so her belief about Larry is really delusion; she does not want to accept her husband's culpability in his death, and so the only way to escape is to insist to herself that he is still alive, and to expect others to feel the same. Because if Larry is dead, then her husband is a murderer in her mind.