Peter C.

Bisulca

In other words, this Open Market Operations mechanism is the valve that controls the flow of tax payer money in and out of the US Economy at the discretion of the Federal Reserve Bank of New York. The valve is directly opened and closed by the New York Fed, which is owned and operated by a consortium of private banks, i.e. probably the giant Wall Street Banks who are now deemed too big to fail. As I mentioned earlier, Timothy Geithner, now our Secretary of Treasury was the former president of this organization. We can only speculate that the giant Wall Street Banks deemed too big to fail are players within the Fed who partially control the NY Fed and the eleven other Federal Reserve Banks. We can only speculate because their membership list is not public information. If the giant Wall Street Banks are not the members of the New York Fed, then who are its members? My guess would be the same giant Wall Street Banks that took advantage of the 2008 bailout. These same banks, as of October 2009, are likely to reap huge profits from the buying and selling of US Treasury Bonds.

Why is there a tremendous amount of buying and selling happening in the US Treasury bond market, reference date 2009?
Ironically, the US Treasury has to issue a lot of debt through the Federal Reserve every quarter to raise new money in order to fund exorbitant Government spending. Since the consumers are no longer in a position to continue spending the way that they were during the height of the economic boom, the Government feels it needs to fill the void of spending to support the economy. The primary banks that get the new US Treasury Bonds issued first from the Fed stand to make huge trading profits on the buying and selling of this new money being raised by the Federal Government.

How many new U.S. Treasury Bonds will have to be issued in 2009?
The U.S. Congressional Budget Office or CBO puts out a series of reports each year called the The Budget and Economic Outlook. You could visit their website and view this information at www.cbo.gov. Here is the exact quote from page 17 of CBOs August 2009 update.
The Congressional Budget Office (CBO) estimates that the federal budget deficit for this fiscal year will total $1.6 trillion, or 11.2 percent of gross domestic product (GDP). That large deficit reflects the combination of weak revenues and elevated spending associated with the current recession, including the costs for the significant interventions in the financial markets undertaken by the government. 20

The Wealth Creation Revelation

How will the U.S. Federal Government raise 1.6 trillion dollars to cover the 2009 deficit?
The Federal Reserve Bank issues new Treasury Bonds and the sixteen primary dealers appointed by the Federal Reserve sell the bonds to foreign and domestic investors. As a broker in this exclusive transaction, the primary dealers stand to make a huge profit. We can only speculate, but with all of these new Treasury Bonds circulating, if primary dealers make just .25% or 25 basis points on 1.6 trillion dollars worth of bond trading, this equates to a 4 billion dollar profit. Here are the numbers:
$1,600,000,000,000 bonds X .25 percent = $4,000,000,000 trading profits

In this system, the banks benefit when the economy is good by selling and overloading consumers with debt. On the flip side, when the consumer debt bubble bursts and the consumers are tapped out, the banks profit by selling and trading US Treasury Debt. The banks simply start building a new debt bubble driven by Government spending instead of consumer spending. The giant banks set themselves up for a win-win situation at everyone elses expense. Do you think it is a conflict of interest for a few members of the private banking industry to be in control of a money-valve that directs an infinite flow of money whenever and wherever they want it? It seems the same as giving the keys to a candy store away to a group of five year old children and telling them . . .
Children make sure you dont eat too much candy because you will get a stomach ache; the adults will be back in two hours. No one will be watching you, just tell us what you ate when we get back.

How naive we, the American people, have become as a society to trust and tolerate something so ridiculous and evil.

As a people of America, what has happened to our self-esteem?

On a scale of one to ten, ten being the highest, how would you rate our self-esteem as Americans? I would give us a score of five. We are not who we think we are. We are living in a suppressed state of economic slavery imposed upon us by banks.
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Peter C. Bisulca

Our low self-esteem has allowed the banks to encroach on our democracy. They have used their money and power to create legislature that would enslave us in debt. This debt has devalued our dollar making it even more difficult to purchase our wants, insuring that we will not be able to pay in full for what we want, and thus forcing us to borrow from the banks to satisfy our desires. Have you noticed that we have become a monthly payment society and that much of our monthly income is transferred to a bank in the form of a payment? Many Americans go to work each day to try and satisfy their bank payments. Sadly, at the end of the month, there is hardly anything left for them to save for themselves. We, as Americans, should not have to work this hard for nothing. We, the American people, outnumber the bankers. This is America; each person is entitled to one vote. We can have a simple system that benefits us, the American people, and not the banks. When it comes time to vote for a candidate that will represent us, the American people, on this issue, we should be able to make an informed choice.

The 10 Trillion Dollar Question

Where does the NY Fed get the enormous purchasing power to conduct open market operations?
Before I go on to explore this question, there is a great deal of information regarding the Federal Reserve in circulation written by people who claim to know the answer to this question. Everything written in this book regarding the Fed has been given to me directly from the Fed via its public-informationtelephone-line or its website. I wrote the book intentionally this way so that you could verify everything that I have said simply and easily. The Federal Reserve has been very generous in sharing with me answers to almost all of my questions except this one, How does the Federal Reserve create money? I sent several emails to the Federal Reserve on this issue, and they did not respond at all. In a phone conversation with an employee of the Federal Reserve, I received this response:
The Federal Reserve feels that this is a complicated topic, and due to its complexity refrains from explanation as the explanation may be misinterpreted. There is a department trained to handle this kind of question but because the answer is complicated and likely to be misinterpreted the department will probably take a very long time to answer your question or not respond at all.

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The Wealth Creation Revelation

It is no secret and for the sake of simplicity we must assume that the Federal Reserve is authorized to create dollars from nothing. On the next page is a flow chart. I created it myself using information found on the US Federal Reserves website. It is my own attempt to interpret this convoluted shell game in an effort to simplify it for you. [3]

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Peter C. Bisulca

Federal Reserve Mechanism

US Treasury Department/US Government/American People Pay the Interest (Debtor)

Congress Granted power to the Fed to issue New Bonds and add to the US National Debt at its discretion

Group A
The Federal Reserve of NY Securities Agent to the US Treasury
The Fed conducts an auction and sells new bonds to the 16 primary dealers

Group B
16 Primary unpublished dealers who are not publically published, but likely to be major financial institutions such as giant Wall St. firms that broker US Treasury bonds, ironically these banks could be actual members of the NY Fed

The Dealers broker the bonds and sell them to investors trying to profit on the trade for taking risk

Foreign and Domestic Investors buy US Treasury Bonds as Investments (China, Japan, etc.) Group A and Group B could be the same people wearing different hats; we are not allowed to know. Is JP Morgan Chase a member of the US Federal Reserve?

I will try and summarize the flow chart above. Group A represents the New York Federal Reserve. We dont know the identity of the members; we
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The Wealth Creation Revelation

just know they are private banks that pay membership dues. We could guess that they are giant Wall Street Banks. When they want money, they can simply issue and sell new US Treasury Bonds. The American tax payer will pay interest on these bonds, and the Federal Reserve can issue new bonds without the permission of Congress. Group A then sells the bonds to Group B. Group B is comprised of 16 private security dealers that will sell the bonds to investors such as the Chinese government, Saudi investors, etc. As discussed earlier, primary dealers will probably take a fee or commission for facilitating trading. Group B could be a bank that was part of Group A.

What if there arent any buyers for the bonds when the Federal Reserve needs capital?
The Federal Reserve simply creates money from nothing on its balance sheet and purchases unsold bonds. This action is known as monetizing the debt. This creates soaring inflation and may devalue the U.S. currency on the international currency exchange. As our currency becomes devalued, items that we purchase from other countries become more expensive. This is something that we may be seeing and hearing a lot about in the years to come. The depression and the financial crisis we are in will entice the Federal Reserve and the Government to spend trillions of dollars.

Is it smart for America to have the fate of our economy in the hands of Wall Street Banks or Private Banks?
I have personally met many good people on Wall Street, but from my experience, the majority of people who have nested on Wall Street are the kind of people that put their love of money before their love of people. The temptation is too great to have such access to an unlimited amount of capital. This kind of power is intoxicating and destructive. If corruption was to be attracted to anything, it would be attracted to the control over this money pumping valve. A network of corruption and strategic corporate alliances would form around this focal point forming an epicenter of greed so powerful that it could impoverish a nation while giving power and wealth to just a few. Earl Nightingale was a famous radio personality, businessman and motivational speaker. He passed away on March 28, 1989. One of his greatest educational works, Lead the Field inspired me to write this book. [4] Earl Nightingale said, The greatest ignorance of all is thinking you can receive something without earning it. Eventually, the universe will balance itself out by taking back in excess from those who took unearned profits. As
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Peter C. Bisulca

Nightingale says, It is like throwing out a boomerang, we dont know when it will return, but it will, and when it does, the losses will be much greater than what was received. [4] The definition of earning by Nightingales standards is directly related to ones contribution to others. Quite simply, if an individual is not earning enough, he or she is not contributing enough. The more one can contribute to others, the more wealth a person shall receive. [4] In my opinion, the monetary system that we have today suffocates Nightingales concept. Imagine how wonderful it would be if we lived in a country where the system rewarded those who contributed to others, and the greater the size of our contribution, the greater our wealth would be. This is my view of capitalism. Dont get me wrong, I believe that it is possible to receive wealth in our current system based on the size of ones contribution. However, I think that our current monetary system works against this ideal simply because the system entices people to borrow money, and this debt acts like a noose around their neck. Their business practices can easily become more about servicing debt each month vs. contributing to people or following the natural unfolding process of creating something good. This is why our founding fathers sacrificed so much in their era to give us our own country. They wanted a place where the human spirit could flow naturally. They wanted to give us a place where each persons capitalistic ideas could manifest without the enslavement or pressure from banks and big government taxes. Quite simply, most ideas do not unfold in enough time to satisfy the pace at which debt needs to be serviced. So there is an unnatural suffocation of capitalism and individual success amongst Americans at this time. Debt is simply a noose around our neck that strangles our true intentions.

Is it smart for America to have a mechanism that interferes with the free markets?
Below are some quotes from Thomas Jefferson, one of our Founding Fathers and the principal author of the Declaration of Independence:
I sincerely believe . . . that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale.Thomas Jefferson to John Taylor, 1816. [5]

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