Unable to setup hybrid or federation trust with exchange 2010

Okay its trying a proxy somewhere...

VERBOSE: Creating new Federation Trust "Microsoft Federation Gateway" for federation partner  "LiveId". Federation
certificate has thumbprint "32f3eed02c63d06fcd3d595d464df8783bdc3edd".
VERBOSE: [16:03:53.655 GMT] New-FederationTrust : Resolved current organization: .
VERBOSE: [16:03:53.655 GMT] New-FederationTrust : Requesting Federation Metadata from
https://nexus.microsoftonline-p.com/FederationMetadata/2006-12/FederationMetadata.xml.
VERBOSE: [16:04:14.684 GMT] New-FederationTrust : Failed to retrieve Federation Metadata from the Microsoft Federation
Gateway. This operation will be retried in a few seconds. Last error: System.Net.WebException: Unable to connect to the
 remote server ---> System.Net.Sockets.SocketException: A connection attempt failed because the connected party did not
 properly respond after a period of time, or established connection failed because connected host has failed to respond
 172.19.10.17:8090
   at System.Net.Sockets.Socket.DoConnect(EndPoint endPointSnapshot, SocketAddress socketAddress)
   at System.Net.ServicePoint.ConnectSocketInternal(Boolean connectFailure, Socket s4, Socket s6, Socket& socket,
IPAddress& address, ConnectSocketState state, IAsyncResult asyncResult, Int32 timeout, Exception& exception)
   --- End of inner exception stack trace ---
   at System.Net.HttpWebRequest.GetResponse()
   at
Microsoft.Exchange.Management.FederationProvisioning.PartnerFederationMetadata.GetFederationMetadataXPathDocument(Uri
partnerFederationMetadataEpr).
VERBOSE: [16:04:40.721 GMT] New-FederationTrust : Failed to retrieve Federation Metadata from the Microsoft Federation
Gateway. This operation will be retried in a few seconds. Last error: System.Net.WebException: Unable to connect to the
 remote server ---> System.Net.Sockets.SocketException: A connection attempt failed because the connected party did not
 properly respond after a period of time, or established connection failed because connected host has failed to respond
 172.19.10.17:8090
   at System.Net.Sockets.Socket.DoConnect(EndPoint endPointSnapshot, SocketAddress socketAddress)
   at System.Net.ServicePoint.ConnectSocketInternal(Boolean connectFailure, Socket s4, Socket s6, Socket& socket,
IPAddress& address, ConnectSocketState state, IAsyncResult asyncResult, Int32 timeout, Exception& exception)
   --- End of inner exception stack trace ---
   at System.Net.HttpWebRequest.GetResponse()
   at
Microsoft.Exchange.Management.FederationProvisioning.PartnerFederationMetadata.GetFederationMetadataXPathDocument(Uri
partnerFederationMetadataEpr).
VERBOSE: [16:05:06.757 GMT] New-FederationTrust : Admin Audit Log: Entered Handler:OnComplete.
VERBOSE: [16:05:06.851 GMT] New-FederationTrust : Admin Audit Log: Exited Handler:OnComplete.
Unable to access the Federation Metadata document from the federation partner. Detailed information: "Unable to connect
 to the remote server".
    + CategoryInfo          : MetadataError: (:) [New-FederationTrust], FederationMetadataException
    + FullyQualifiedErrorId : 26E1623C,Microsoft.Exchange.Management.SystemConfigurationTasks.NewFederationTrust

but i cannot see where this IP resides...

Yes, works fine.

was caused by proxy server being set on local system account.
ran scripts to fire up IE as local admin and took off old proxy