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It stands for Ford Engine. In the 50s, when the first FE came out, the folks at Ford wanted to keep the company separated into two camps, Ford & Thunderbird and Lincoln & Mercury. The big plan fell apart over the years, but the FE was originally designed for the Ford side.
There are other "reasons" floating around, but this one makes the most sense to me.
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Do you know why they call it "PMS"? Because "Mad Cow Disease" was taken. --Unknown, presumed deceased
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