WSJ too close to the Federal Reserve?

On Bloomberg TV on Wednesday morning, former Morgan Stanley Asia non-executive chairman Stephen Roach pointed out the Wall Street Journal‘s uncanny relationship with the Federal Reserve.

Roach said that, “[The Fed] has gone about their usual pre-FOMC leak frenzy where they talk to this reporter and that reporter. Jon Hilsenrath is actually the chairman of the Fed. When he writes something in the Wall Street Journal, Bernanke has no choice but to deliver on what he wrote..Absolutely, the Fed will move next week.”

Roach — who serves on the senior executive team at Morgan Stanley as well as a lecturer at Yale University — went on to tell Bloomberg TV’s Betty Liu, “The point is, when [the Fed] plants a story in the WSJ — and [yesterday’s A1] story has been planted — Jon Hilsenrath is the weed that grows, the guy has a perfect track record — they’ll do some kind of action.”

The Morgan Stanley senior executive is critical of actions by the Fed, saying, “The Fed is flailing and has been flailing for the better part of the past three years…They’re dangling this raw meat in front of the markets and the markets are salivating as they always do in their sort of frenetic way to believe in the Fed. But it hasn’t worked and it won’t work.”

To watch the interview, go here. Hilsenrath is the Journal’s chief economics correspondent and is based in Washington. He is responsible for covering the Fed.