When you edit your profile you are asked if you would update your profiles in other SE sites. How was this implemented? Is there separate record for profile for each site? I don't understand this since there are one log in for all sites.
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You have a different account on each Stack Exchange site. The fact you are automatically logged-in is because a Stack Exchange site notices you are already logged-in on a different Stack Exchange site using an OpenID account that is associated with a user account.