Month: August 2016

First it was Germany who redeemed 120 tons of physical gold from the NY Fed in 2014; then it was the Netherlands who “secretly” redomiciled 122 tons of gold; then last May, we learned that Austria would be the third “core” European nation to repatriate most of its offshore gold, held primarily in the Bank of England, redepositing it in Vienna and Switzerland.

That was just the beginning. Thanks to the latest NY Fed data, we now know that beginning in 2014 and continuing through yesterday, the gold “bleeding” from the vault located 90 feet below street level at 33 Liberty Street  is not only continuing but accelerating.

As the chart below shows, while central banks assure the population that there is nothing to worry about when it comes to paper money, which may or may not soon be banned if certain Harvard economists have their way, they have been quietly accelerating their withdrawals of gold from the biggest centralized depository of global gold in the world: the New York Federal Reserve.

According to the Ny Fed, in the seven months ended July 2016, there were a total of 87 tons of gold withdrawals, 25% more than the 69 tons withdrawn in the same period in 2015, and 60% more than the 55 tons withdrawn in 2014. As of July 31, the NY Fed held 5,807 tons of gold in custody, well below the 6,606 “old normal” that was parked at the Fed until withdrawals started in early 2007.

Just as remarkable, since the current round of monthly withdraws from the NY Fed started in February of 2014, there has been a total of 388 tons of gold redeemed by foreign central bank holders over a span of 30 months, which is just 20 tons shy of the previous burst of withdrawals which started in March of 2007, with the emergence of the subprime crisis, and culminating in November 2008 with the bailout of AIG.

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Last week we noted Trey Gowdy’s interview on Fox News where he divulged that Clinton had used a software called “BleachBit” to permanently delete emails in a way to “prevent their recovery” and “hide traces” of their deletion (see “FBI Admits Clinton Used Software Designed To “Prevent Recovery” And “Hide Traces Of” Deleted Emails“).  What got less attention in that post, however, was Gowdy’s question of whether Clinton considered email correspondence with the Clinton Foundation and its donors to be “work related” or “personal”. 

There is increasing evidence that Clinton Foundation related email traffic was specifically omitted from disclosures to the FBI.  Recent emails received under various FOIA requests have uncovered numerous Clinton emails, related to the Clinton Foundation, that were “mysteriously” absent from the “30,000 work-related emails” that were previously turned over to the FBI.  That omission obviously begs the question of how Hillary could possibly consider correspondence with the Clinton Foundation and/or its donors to be “personal”.  Certainly Meredith McGehee, policy director at the Campaign Legal Center, a nonpartisan, nonprofit organization, thinks “It would be a difficult argument” for Clinton to suggest that Clinton Foundation emails were “personal.”

The latest example comes from McClatchy DC and involves another email exchange between then Secretary of State, Hillary Clinton, and a large Clinton Foundation donor, Abigail Disney, who was looking for a favor.  The email exchange in question was revealed by Citizens United and was among the emails received after winning a lawsuit related to their previously unanswered FOIA request.  Oddly enough, this email exchange, and many others like it, were excluded from the “30,000 work-related emails” that Clinton originally disclosed to the FBI. 

Turns out Disney, a Clinton Foundation donor to the tune of $100,000 – $250,000, wanted Hillary to focus more on women’s issues at the next meeting of the Clinton Global Initiative.  But Disney didn’t go to the Clinton Foundation for help with her request she went straight to the Secretary of State.  Per McClatchy DC, Disney’s July 2012 email to Hillary included the following:

“We have attended the Clinton Global Initiative now for a few years and feel it is an important gathering of some of the finest and most important thinking about International Aid.  We do, however, feel that woman’s issues have not gotten the attention or the placement they deserve. We are hoping you might consider helping us ‘rock the boat’ a little bit this year.”

Huma Abedin, for one, was apparently not pleased with Disney’s persistence and/or her direct communications with Hillary.  Explain to us again why would direct communications with Hillary be a problem?  Per an email from Abedin to officials at the Clinton Global Initiative on July 23, 2012: 

“The problem is she keeps emailing hrc directly and is quite anxious to talk.”

After a subsequent conversation with Disney, Huma provided the following update to the Clinton Global Initiative Deputy Director, Ed Hughes:

“They [Abigail Disney] are going to come back with a clearer proposal for what they want and I told them hrc role at cgi hadn’t even been discussed yet which happens to be true.”

Now we’re not legal experts by any stretch but that seems an awful lot like Huma is suggesting that a Clinton Foundation donor is going to put together a very specific request for a favor from the Secretary of State.  We’ll let you be the judge.

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Submitted by Lance Roberts via RealInvestmentAdvice.com,

While the world has been focused on the Federal Reserve, the markets, and the upcoming election, few have noticed the expansion of the deficit in recent months which is now in excess of $667 billion up from a recent low of $530 billion. The chart below shows the history of U.S. surplus/deficit:

During the financial crisis, the deficit ballooned to a record of $1.35 trillion as tax revenue declined as Government spending swelled. Importantly, the Federal Deficit was approaching 10% in 2009, a historical record for the U.S., but still remains at levels associated with weaker economic growth rates and recessions.

The decline in the deficit was artificial in many ways as it was primarily due to the reforms from the “2011 Budget Control Act” which including tough spending cuts and a big tax bite that impacted a large majority of the middle class. Much of that “austerity” has now been reversed.

 

Tax The Rich

The surge in tax revenues was a direct result of the “fiscal cliff” at the end of 2012 as companies rushed to pay out special dividends and bonuses ahead of what was perceived to a fiscal disaster and higher tax rates. The large surge in incomes was primarily generated at the upper end of the income brackets where individuals were impacted by higher tax rates. Those taxes were then paid in April and October of 2013 and accounted for the sharp decline in the deficit. Also, it is important to remember that payroll taxes also increased due to the expiration of the payroll tax cut from 2010. (Note: the increased tax collection from payrolls remains currently.) 

This surge in tax revenue can be seen more clearly in the chart below of tax receipts as a percentage of GDP.

While making the rich “pay their fair share” may increase revenue in the short run, over the longer term higher tax rates, and the subsequent redistribution of wealth leads to lower economic growth. Louis Woodhill put it best:

“To ‘tax’ is to take away something from someone and give it to the government. ‘The rich’ are rich because they own a lot of assets. So, what it means to ‘tax the rich’ is to take assets away from rich people and transfer them to the government.

 

So, what are the assets that the rich own? The rich don’t have money bins full of cash, like Scrooge McDuck. Rather, they own things like factories, office buildings, and oil wells, either directly or indirectly via stocks and bonds. In other words, the rich own most of the ‘nonresidential fixed assets’ of the nation. These assets certainly count as ‘wealth’, but what they are physically are the tools that workers use to produce America’s GDP.”

This is critically important to understand. By increasing taxes, to generate additional revenue for the government, you decrease the available capital that could be used for productive investments. Since the government doesn’t want factories, office buildings, or oil wells, but rather cash, this forces the liquidation of productive investments thereby reducing capacity for economic growth.

The current Administration is failing once again to recognize the problems that exist with this country, at this moment, does not lie with the “rich.” Instead, the problem is a lack of ability for consumers to maintain a standard of living that is well beyond their earnings capability. While the two most recent Administrations have been heavily criticized for running burgeoning deficits – the reality is that the average American has been doing the same for the past thirty years.

While tax dollars do get recycled back into the economy, repeated studies have shown that government spending has a much lower “multiplier” effect as compared to dollars spent directly by consumers and businesses. 

I have highlighted the periods when receipts as a percentage of GDP have peaked. There are two things worth noting in the chart above/below. Rising levels of receipts have coincided with stronger levels of economic growth in the early stages which is not surprising as more revenues lead to higher collections. However, once those collections exceed 18% of GDP, it has generally marked the peak of economic activity and a subsequent recessionary drag in the economy.

There is one other point to be made. While there are many calls to raise taxes on the rich, give more to the poor, what the chart shows is that none of that really makes much difference. Regardless of the level of tax rates – tax receipts as a percentage of the economy has remained mired between 16 and 21%. Why? Because when you raise taxes, you lower economic growth and, therefore, collect less in revenue. During recessions, tax collections are at the lower end of the range while during expansions collections are at their highest.

So, what does all of this mean? As Arthur Laffer noted 3 decades ago, it really is possible to set tax rates too high such that it actually hurts the economy.

We appear to once again be in such a condition now.

The chart below shows receipts as a percent of GDP as compared to the S&P 500 index. (Note: Each peak in tax collections has coincided with a mean-reverting event in the markets as a recessionary drag took hold.)

While there are many that expect that the markets can repeat the secular bull market of the 90’s, and by extension, receipts could test the previous high, this is not likely. The demographic and economic makeup, valuation levels and interest rates currently weigh heavily against that probability.

 

It’s The Deficit Stupid

As stated above, as the “rich” invest in productive investments it leads to higher employment, strong consumer demand and economic growth. In turn, this leads to higher tax revenue.

However, deficits, and deficit spending, are HIGHLY destructive to economic growth as it directly impacts gross receipts and saved capital equally. Like cancer – running deficits, along with continued deficit spending, continues to destroy saved capital and damages capital formation. 

Debt is, by its very nature, a cancer on economic growth. As debt levels rise it consumes more capital by diverting it from productive investments into debt service. As debt levels spread through the system it consumes greater amounts of capital until it eventually kills the host. The chart below shows the rise of federal debt and its impact on economic growth.

The reality is that the majority of the aggregate growth in the economy since 1980 has been financed by deficit spending, credit creation and a reduction in savings. This reduced productive investment in the economy and the output of the economy slowed. As the economy slowed, and wages fell, the consumer was forced to take on more leverage to maintain their standard of living which in turn decreased savings. As a result of the increased leverage more of their income was needed to service the debt – and with that the “debt cancer” engulfed the system.

The Austrian business cycle theory attempts to explain business cycles through a set of ideas. The theory views business cycles:

“As the inevitable consequence of excessive growth in bank credit, exacerbated by inherently damaging and ineffective central bank policies, which cause interest rates to remain too low for too long, resulting in excessive credit creation, speculative economic bubbles and lowered savings.”

The problem that is yet not recognized by the current Administration and mainstream economists is that the excessive deficits and exponential credit creation can no longer be sustained. The process of a “credit contraction” will eventually occur over a long period of time as consumers and governments are ultimately forced to deal with the deficits.

The good news is the process of “clearing” the market will eventually allow resources to be reallocated back towards more efficient uses and the economy will begin to grow again at more sustainable and organic rates.

Today, however, expectations of a return to economic growth rates of the past are most likely just a fairy tale. The past 8-years of stock market returns have been fueled by trillions of dollars of support and direct injections into the financial system – that support is not sustainable in the long run. While the injections have kept the economy from falling into a depression in the short term – the unwinding of that support will suppress economic growth for many years to come.

There is no way to achieve the necessary goals “pain-free.”  The time to implement austerity measures is when the economy is running a budget surplus and is close to full employment. That time was two Administrations ago when the economy would have slowed but could have absorbed and adjusted to the restrictive measures. However, when things are good, no one wants to “fix what isn’t broken”. The problem today is that with a high dependency on government support, high levels of underemployment and rising budget deficits, the implementation of austerity measures will only deter future economic growth, which is dependent on the very things that need to be “fixed”.

The processes that fueled the economic growth over the last 30 years are now beginning to run in reverse, and when combined with the demographic shifts in the U.S., the impact could be far more immediate and prolonged than the media, economists and analysts are currently expecting. Sacrifices will have to be made, the economy will drag on at subpar rates of growth, individuals will be working far longer into their retirement years and the next generation of Americans will lead a far different life that what the currently retiring generation enjoyed.

It is simply a function of the math.

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Since Michael Lewitt, aka “The Credit Strategist” is one of our preferred bond market analysts, we enjoyed his latest interview by Financial Sense‘s Jim Puplava, where he discusses the only thing that matters: “are we on the verge of a massive market crash.” It will hardly come as a surprise that Lewitt, author of The Committee to Destroy the World: Inside the Plot to Unleash a Super Crash on the Global Economy, argues that the problems we faced in the last recession haven’t been dealt with and, as a result, another crisis is likely, particularly when it comes to the opaque derivatives market. In sum, Lewitt believes we are “in the late stages of Ponzi finance.”

The following is a summary of Puplava’s interview with Lewitt, which can be heard in full here.

Failed Policies

We see abundant evidence that government policies have failed and are failing, Lewitt said. 

“They’ve tried to solve the debt crisis by printing trillions of dollars of more debt,” he noted. “They’ve added on top of that hundreds of billions of regulations or new regulatory costs, and somehow they expect the economy to grow under the weight of those burdens.”

These and other missteps by regulators have hampered growth and have created our current low-yield, low-interest rate muddled economy. Many regulators come from the same class of academic economists, Lewitt argued, and they don’t understand how the world actually works.

As such, he said, our current course is going to lead to another crisis.

Debt and Regulations Are Crippling Growth

The worst thing about the debt buildup is borrowed money isn’t being used for productive ends, Lewitt said. And what’s more, political will doesn’t exist to fix what is an acknowledged problem, he added.

“You couldn’t design this worse if you tried,” he said. “Low-interest rates cover up a lot of things, but eventually you have to pay the money back.”

As the debt inevitably matures, companies will be looking back on years of low growth, and they’ll have to default, Lewitt stated. And governments will keep taxing and spending until there’s pushback.

In terms of regulations, Lewitt said he feels they were well intentioned. The financial system was grossly overleveraged, but the problem is regulations went too far, he added.

“Markets are over-regulated right now. It’s one thing to want to make sure banks aren’t levered 30-to-1, but it’s another thing to come up with a set of regulations that dries up liquidity in markets,” he said.

* * *

Fed Is a Shadowy, Poorly Understood Force

Nobody wants to connect the dots, and most people don’t understand what the Fed does, or even what the fractional reserve banking system is, Lewitt noted.

“As a result, we have a system where the most powerful government agency in the world, the Federal Reserve, really operates without very many checks and balances,” he said.

We’ve seen regulators that are just hurting markets and making missteps. For example, the Fed should have raised rates at the latest in 2014, but instead persisted with crisis-era policies, Lewitt said.

What we’ve ended up with is a massive regulatory state because the government doesn’t trust people to manage themselves, he added.

* * *

Derivatives Market Is a Mess

Right now, American banks are much better capitalized and everything will be fine, Lewitt stated, unless derivatives become a problem.

For example, if Deutsche Bank is unable to meet its obligations on its $60 trillion in derivatives, counterparties around the world, including Goldman Sachs, J.P. Morgan, and others, are going to have a problem.

“It’s a huge daisy chain,” he noted. “The problem with derivatives has not been solved—it’s been glossed over. There is $200 trillion debt globally, and there’s no way the global economy can generate the productivity to service that debt.”

* * *

Later Stages of Ponzi Finance

“We’re … just borrowing new money to pay back old money,” Lewitt said. “I would say that we’re in the late stages of Ponzi finance.”

This doesn’t end well, Lewitt noted. At some point, people will have to come up with real money to pay debts. Or in our case, we’re going to devalue money to pay our debts through inflation and currency debauchment, Lewitt said. Those are our only options.

But we can make a positive impact to prevent some of this from happening, Lewitt argued.

“We should discourage debt,” he said. “We should encourage equity. We should discourage speculation. We should encourage productive investment. And in order to do that, you need to change the tax code, which right now does the opposite.”

We also need to lower the growth of debt, he said. And we need to figure out how to improve productivity and improve economic growth. The ways to do that are to fix the tax code, reduce regulation, and allow the economy rather than the government to run things, Lewitt added.

For individuals, this means getting out of bonds, having some gold, not being afraid to hold cash, and being very cautious of equities, Lewitt said.

“Now is not the time to be a hero,” he said. “Now’s the time to worry about protecting your capital.”

* * *

The interview can be accessed here.

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Submitted by Michael P Ramirez,

It always amazes me when people seem to confuse the right to make a statement with the right to be insulated from the reaction to their actions. Take for example, 49ers quarterback, Colin Kaepernick, who recently sat down during the playing of our National Anthem. There is no question, he has every right to do it. But Newton's third law of physics applies here:

For every action, there is an equal and opposite reaction.

Americans, in response, have the right to sit at home when asked to stand in line to support him or the 49ers. Just as Colin has a right to make his statement, Americans have a right to disagree with him, to loathe his actions and to use their pocket books to complete their statement of disagreement.

I will stand up for that.

Colin has every right to sit down. Just as he has the right make up some lame excuse for his gesture. Colin seems to believe that America is a land of oppression and police abuse. Unfortunately for Colin, the facts contradict his statement.

The majority of Americans that die from police abuse constitute a very small number and are mostly whites. The vast majority of blacks that are killed in homicides are by black on black crime. The percentage of incarceration of minorities is due to the larger percentage of crimes that are committed by those groups.

Perhaps someone should ask Colin if the record number of homicides in Chicago are the result of police abuse.

Some ESPN columnist seems to think he is courageous.

Real courage is the Dallas Police running towards gunfire to protect fellow citizens. 

 

Real courage is putting on a uniform for more than one day and going to work with the real possibility of not coming home because you can be killed in the line of action trying to protect citizens.

 

Real courage is doing that every day in some of America's most dangerous places to serve the public and for a tiny percentage of what high-priced professional athletes make, in communities that I am certain Colin Kaepernick does not live remotely close to.

There is no question that racism still exists in America and, unfortunately, the racial climate seems much worse today, after 8 years of progressive policies under the current administration. But last time I checked, the president of the United States was an African American. The head of the Justice Department was an African American. In a 2012 article, six of the top ten highest paid NFL players on the Forbes list were African American. In the 21st century America, racism is represented by the fringe of our society and that constitutes a small percentage of the whole.

In America, everyone has the right to say and do stupid things, just as people have the right to say Kaepernick's action, is a self-serving gesture by a player who is failing to win his postion and utilizing some desperate tactic to seek attention.

Compare Colin's actions with the recent actions of U.S. Olympic Bronze Medal Pole Vaulter U.S. Army Reserve 2nd LT Sam Kendrick. Sam Kendrick stopped, dropped his pole and stood for the Star Spangled Banner at this year's Olympic games in the middle of competition, to honor this country that has afforded its people liberty and freedom.

As a reservist in the military, Sam and his fellow soldiers have witnessed firsthand, real oppression. They know firsthand, the price of freedom.

But Sam was not trying to draw attention to himself.

Perhaps Colin needs to visit countries that do not have the freedom that some spoiled multi-millionaire athletes apparently take for granted.

America is great because we have the freedom and liberty to follow our dreams, and the freedom of self expression. Our national anthem is deserving of respect because it represents this great country that protects the freedom to stand up or sit down for what you believe in.

Part of that freedom is the right to make stupid gestures. Just don't be offended when people call you stupid.
 
There is a quote often attributed to Lincoln which Colin may want to consider in the future…

Better to remain silent and be thought a fool than to "sit down" and to remove all doubt.

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Judicial Watch announced on its website today that it has submitted a list of 25 questions to Hillary Clinton regarding her email practices while serving as Secretary of State.  Pursuant to a decision by U.S. District Court Judge Emmet G. Sullivan, Hillary has 30 days to respond, under oath, to the questions.  Per federal law, Judicial Watch was limited to a total of 25 questions.

All 25 questions are included in their entirety below (we’ve highlighted some of the particularly amusing ones):

1. Describe the creation of the clintonemail.com system, including who decided to create the system, the date it was decided to create the system, why it was created, who set it up, and when it became operational.
2. Describe the creation of your clintonemail.com email account, including who decided to create it, when it was created, why it was created, and, if you did not set up the account yourself, who set it up for you.
3. When did you decide to use a clintonemail.com email account to conduct official State Department business and whom did you consult in making this decision?
4. Identify all communications in which you participated concerning or relating to your decision to use a clintonemail.com email account to conduct official State Department business and, for each communication, identify the time, date, place, manner (e.g., in person, in writing, by telephone, or by electronic or other means), persons present or participating, and content of the communication.
5. In a 60 Minutes interview aired on July 24, 2016, you stated that it was “recommended” you use a personal email account to conduct official State Department business. What recommendations were you given about using or not using a personal email account to conduct official State Department business, who made any such recommendations, and when were any such recommendations made?
6. Were you ever advised, cautioned, or warned, was it ever suggested, or did you ever participate in any communication, conversation, or meeting in which it was discussed that your use of a clintonemail.com email account to conduct official State Department business conflicted with or violated federal recordkeeping laws. For each instance in which you were so advised, cautioned or warned, in which such a suggestion was made, or in which such a discussion took place, identify the time, date, place, manner (e.g., in person, in writing, by telephone, or by electronic or other means), persons present or participating, and content of the advice, caution, warning, suggestion, or discussion.
7. Your campaign website states, “When Clinton got to the Department, she opted to use her personal email account as a matter of convenience.” What factors other than convenience did you consider in deciding to use a personal email account to conduct official State Department business? Include in your answer whether you considered federal records management and preservation requirements and how email you used to conduct official State Department business would be searched in response to FOIA requests.
8. After President Obama nominated you to be Secretary of State and during your tenure as secretary, did you expect the State Department to receive FOIA requests for or concerning your email?
9. During your tenure as Secretary of State, did you understand that email you sent or received in the course of conducting official State Department business was subject to FOIA?
10. During your tenure as Secretary of State, how did you manage and preserve emails in your clintonemail.com email account sent or received in the course of conducting official State Department business, and what, if anything, did you do to make those emails available to the Department for conducting searches in response to FOIA requests?
11. During your tenure as Secretary of State, what, if any, effort did you make to inform the State Department’s records management personnel (e.g., Clarence Finney or the Executive Secretariat’s Office of Correspondence and Records) about your use of a clintonemail.com email account to conduct official State Department business?
12. During your tenure as Secretary of State, did State Department personnel ever request access to your clintonemail.com email account to search for email responsive to a FOIA request? If so, identify the date access to your account was requested, the person or persons requesting access, and whether access was granted or denied.
13. At the time you decided to use your clintonemail.com email account to conduct official State Department business, or at any time thereafter during your tenure as Secretary of State, did you consider how emails you sent to or received from persons who did not have State Department email accounts (i.e., “state.gov” accounts) would be maintained and preserved by the Department or searched by the Department in response to FOIA requests? If so, what was your understanding about how such emails would be maintained, preserved, or searched by the Department in response to FOIA requests?
14. On March 6, 2009, Assistant Secretary of State for Diplomatic Security Eric J. Boswell wrote in an Information Memo to your Chief of Staff, Cheryl Mills, that he “cannot stress too strongly, however, that any unclassified BlackBerry is highly vulnerable in any setting to remotely and covertly monitoring conversations, retrieving email, and exploiting calendars.” A March 11, 2009 email states that, in a management meeting with the assistant secretaries, you approached Assistant Secretary Boswell and mentioned that you had read the “IM” and that you “get it.” Did you review the March 6, 2009 Information Memo, and, if so, why did you continue using an unclassified BlackBerry to access your clintonemail.com email account to conduct official State Department business? Copies of the March 6, 2009 Information Memo and March 11, 2009 email are attached as Exhibit A for your review.
15. In a November 13, 2010 email exchange with Huma Abedin about problems with your clintonemail.com email account, you wrote to Ms. Abedin, in response to her suggestion that you use a State Department email account or release your email address to the Department, “Let’s get a separate address or device.” Why did you continue using your clintonemail.com email account to conduct official State Department business after agreeing on November 13, 2010 to “get a separate address or device?” Include in your answer whether by “address” you meant an official State Department email account (i.e., a “state.gov” account) and by “device” you meant a State Department-issued BlackBerry. A copy of the November 13, 2010 email exchange with Ms. Abedin is attached as Exhibit B for your review.
16. Email exchanges among your top aides and assistants in August 30, 2011 discuss providing you with a State Department-issued BlackBerry or State Department email address. In the course of these discussions, State Department Executive Secretary Stephen Mull wrote, “[W]e are working to provide the Secretary per her request a Department issued BlackBerry to replace her personal unit which is malfunctioning (possibly because of her personal email server is down). We will prepare two versions for her to use – one with an operating State Department email account (which would mask her identity, but which would also be subject to FOIA requests).” Similarly, John Bentel, the Director of Information and Records Management in the Executive Secretariat, wrote, “You should be aware that any email would go through the Department’s infrastructure and [be] subject to FOIA searches.” Did you request a State Department issued Blackberry or a State Department email account in or around August 2011, and, if so, why did you continue using your personal device and clintonemail.com email account to conduct official State Department business instead of replacing your device and account with a State Department-issued BlackBerry or a State Department email account? Include in your answer whether the fact that a State Department-issued BlackBerry or a State Department email address would be subject to FOIA affected your decision. Copies of the email exchanges are attached as Exhibit C for your review.
17. In February 2011, Assistant Secretary Boswell sent you an Information Memo noting “a dramatic increase since January 2011 in attempts . . . to compromise the private home email accounts of senior Department officials.” Assistant Secretary Boswell “urge[d] Department users to minimize the use of personal web-email for business.” Did you review Assistant Secretary Boswell’s Information Memo in or after February 2011, and, if so, why did you continue using your clintonemail.com email account to conduct official State Department business? Include in your answer any steps you took to minimize use of your clintonemail.com email account after reviewing the memo. A copy of Assistant Secretary Boswell’s February 2011 Information Memo is attached as Exhibit D for your review.
18. On June 28, 2011, you sent a message to all State Department personnel about securing personal email accounts. In the message, you noted “recent targeting of personal email accounts by online adversaries” and directed all personnel to “[a]void conducting official Department business from your personal email accounts.” Why did you continue using your clintonemail.com email account to conduct official State Department business after June 28, 2011, when you were advising all State Department Personnel to avoid doing so? A copy of the June 28, 2011 message is attached as Exhibit E for your review.
19. Were you ever advised, cautioned, or warned about hacking or attempted hacking of your clintonemail.com email account or the server that hosted your clintonemail.com account and, if so, what did you do in response to the advice, caution, or warning?
20. When you were preparing to leave office, did you consider allowing the State Department access to your clintonemail.com email account to manage and preserve the official emails in your account and to search those emails in response to FOIA requests? If you considered allowing access to your email account, why did you decide against it? If you did not consider allowing access to your email account, why not?
21. After you left office, did you believe you could alter, destroy, disclose, or use email you sent or received concerning official State Department business as you saw fit? If not, why not?
22. In late 2014, the State Department asked that you make available to the Department copies of any federal records of which you were aware, “such as an email sent or received on a personal email account while serving as Secretary of State.” After you left office but before your attorneys reviewed the email in your clintonemail.com email account in response to the State Department’s request, did you alter, destroy, disclose, or use any of the email in the account or authorize or instruct that any email in the account be altered, destroyed, disclosed, or used? If so, describe any email that was altered, destroyed, disclosed, or used, when the alteration, destruction, disclosure, or use took place, and the circumstances under which the email was altered, destroyed, disclosed, or used? A copy of a November 12, 2014 letter from Under Secretary of State for Management Patrick F. Kennedy regarding the State Department’s request is attached as Exhibit F for your review.
23. After your lawyers completed their review of the emails in your clintonemail.com email account in late 2014, were the electronic versions of your emails preserved, deleted, or destroyed? If they were deleted or destroyed, what tool or software was used to delete or destroy them, who deleted or destroyed them, and was the deletion or destruction done at your direction?
24. During your October 22, 2015 appearance before the U.S. House of Representatives Select Committee on Benghazi, you testified that 90 to 95 percent of your emails “were in the State’s system” and “if they wanted to see them, they would certainly have been able to do so.” Identify the basis for this statement, including all facts on which you relied in support of the statement, how and when you became aware of these facts, and, if you were made aware of these facts by or through another person, identify the person who made you aware of these facts.
25. Identify all communications between you and Brian Pagliano concerning or relating to the management, preservation, deletion, or destruction of any emails in your clintonemail.com email account, including any instruction or direction to Mr. Pagliano about the management, preservation, deletion, or destruction of emails in your account when transferring the clintonemail.com email system to any alternate or replacement server. For each communication, identify the time, date, place, manner (e.g., in person, in writing, by telephone, or by electronic or other means), persons present or participating, and content of the communication.

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