Kevin Warsh's Op Ed on WSJ - The Fed's Good Cop Bad Cop Routine Again

The Fed chairman Ben Bernanke put up a modest Op-Ed piece in Washington Post on Thursday last week, trying to justify pumping $600 billion extra money into the financial system against cacophony of protests from nations including China, Brazil, and Germany.

As if to appease them, Kevin Warsh, a former Morgan Stanley banker and former PPT member and a current member of the Board of Governors of the Federal Reserve whose writings have been featured in this blog before, wrote an Op-Ed piece for Wall Street Journal to be published tomorrow but available online already. He's talking like a free-market-loving fiscal conservative. You can read it here.

Now, whether because of this article or not, the stock futures dipped a little. Dow futures is currently down 15 points. So the game plan may be a down day on Monday for the stock market, to correct overbought condition and sucker in shorts who have been itching to short the market for its bogus ramp-up since September; then bam! Turnaround Tuesday and the market jumps 200 points again.

Oh wait, that's what they want me to think... OK, the opposite of that would be a sizable upday but on low volume, and a sell-off comes on Turnaround Tuesday.

Kevin Warsh, by the way, is speaking tomorrow at 3:30 PM EST at SIFMA conference in New York. It's an annual meeting of Securities Industry and Financial Markets Association, and other speakers include Sen. Chris Dodd, FDIC Chairman Sheila Bair, and SEC Chairman Mary Schapiro. Hmmm... An upday Monday all the way to 3:30 PM, and hard sell-off to unchanged or slightly below in the last 30 minutes.

Anyone's guess is good as anyone else's guess, since the market has been broken... Good night and good luck if you trade the market.

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