President Donald Trump says that he has fired Federal Reserve Governor Lisa Cook, per a letter posted on his Truth Social account. The move represents an escalation of the President’s attack against the central bank and its independence.
Cook has been attacked by the President and his Cabinet after Federal Housing Finance Agency Director Bill Pulte claimed that Cook indicated that both of her homes — one in Michigan and another in Georgia — were primary residences.
Under these grounds, the President has exercised a right to remove the Fed Governor “for cause”, citing “false statements on one or more mortgage agreements.”
In the letter, Trump wrote:
“Pursuant to my authority under Article II of the Constitution of the Untied States and the Federal Reserve Act of 1913, as amended, you are hereby removed from your position on the Board of Governors of the Federal Reserve, effective immediately.”
Trump had previously committed that he would fire Cook if she did not resign, amid the accusations. Outside of a criminal referral, no other details are known about the specifics of the accusations.
Cook quipped back that she would not resign. She was last seen at the Federal Reserve Symposium in Jackson Hole, Wyo. on Friday. Per reports, she was accosted by
However, “for cause” is vague in the context of the Federal Reserve Act. It has been seldom used by a sitting President to force people out of the position.
Trump figures he has a considerable incentive in removing Cook. Trump has nominated two Fed Governors and would pick up a third, who could help him corral interest rates lower.
Today, the Fed Funds Rate (FFR) is 4.25% to 4.50%. Trump has repeatedly indicated his desire to reduce rates, calling them too high in constant attacks on Fed chair Jerome Powell, as well as other leaders.
U.S. equity futures fell on the revelation, while gold spiked.
