I've tried removing the clientregistry.blob file, I've never received this error before. Haven't seen anyone else get it before.. it's acting as if it can't connect... but when it can't connect it usually just works offline.
I can't even get onto the SteamPowered website now either.
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ERROR
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Steam.exe (main exception): Unable to start Steam Engine: *SteamStartEngine(0x12e8c8) failed with error 201: Cannot perform this operation while offline
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OK
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