How to get Mouse to focus or FocusFollowsMouse on a MacIntosh?

This can be made to work only for X11 applications. The following seems to work. In your .bashrc file, add

  defaults write com.apple.x11 wm_ffm -bool true
  defaults write com.apple.Terminal FocusFollowsMouse -string YES

Logout and then login again. Open two xterm's and focus should follow mouse for the xterm's.

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