Banks
Power struggle with a central bank – Trump: Disrupts Board member
For months, US President Trump has been having a wedge with the central bank Fed for months because he wants interest rate cuts. Now he uses harder means – it’s about personnel policy.
US President Donald Trump intervenes in the staff policy of the central bank Federal Reserve (FED). Fed governor Lisa Cook will be released from her office on the board with immediate effect, the Republican said on his Truth Social platform. In his letter to Cook, the President said that there were sufficient reasons to assume that she had given incorrect information in one or more mortgage contracts.
A president can only dismiss central bank governors by law if there are sufficient reasons. The decision may be contested.
Trump days ago: “Yes, I will fire her”
Even days ago, the US President Cook wanted to get rid of. When asked by a journalist, whether he would fire her, he said: “Yes, I will fire her if she doesn’t go back.” Cook had recently headed the headlines due to allegations about irregularities when taking out real estate loans. The head of the state finance authority had contacted US Justice Minister Pam Bondi in a letter and addressed the allegations in it.
Trump wants to reduce the key interest rate
Trump has been pounding the key interest rate for months – in vain. In view of inflation concerns, the central bank council also hesitates due to Trump’s import duties. Trump’s demands to the head of the US Federal Reserve, Jerome Powell, resigned, remained unsuccessful. And so far no deeds have followed his threats to fire him if necessary.
Cook’s tenure actually until 2038
Economist Cook has been a member of the board since May 2022. According to Fed, her term of office actually runs until January 31, 2038. Before her appointment, she worked as a professor of economics and international relationships at the Michigan State University.
dpa
Source: Stern
