#federal-reserve
4 entries with this tag
Reacting to a Strong Jobs Report by Demanding the Opposite of What It Called For, Trump Threatened to Halt U.S. Trade With Every Country It Runs a Deficit Against — Most of Its Major Partners — Unless the Federal Reserve Cuts Interest Rates: an Act of Economic Hostage-Taking Economists Likened to the Protectionism That Deepened the Great Depression, and That One Analyst Said Could Make the Depression "Look Like a Walk in the Park"
On September 4, 2026 — hours after a stronger-than-expected jobs report showed employers added about 162,000 jobs in August, nearly triple what economists forecast, with unemployment holding at 4.1% — Trump posted an ultimatum on Truth Social: "LOWER THE RATE OR I'LL STOP TRADING WITH COUNTRIES WITH WHICH WE HAVE A DEFICIT." He was threatening to halt U.S. trade with every nation the country runs a goods deficit against — which is most of its major trading partners, from China to the European Union to Mexico — unless the Federal Reserve cuts interest rates, and he doubled down when challenged. The threat is reckless on every axis. It reacts to good economic news by demanding an emergency measure (rate cuts) that a strong economy does not call for. It attempts to extort an independent central bank into serving the president's political timetable — the same assault on Fed independence documented elsewhere in this archive. And the act itself, a broad trade cutoff, is what economists have spent a century warning against: more than 1,100 of them, including Nobel laureates, have signed a letter against his tariff approach that quotes directly from the 1930 warning against the Smoot-Hawley protectionism that helped turn a downturn into the Great Depression, while banks like Scotiabank model his measures pushing trade costs to "Great Depression levels." As one analyst put it, a full halt could make the Great Depression "look like a walk in the park." Whether Trump carries it out or not, a president threatening to detonate the global trading system to bully the Fed is the kind of statement that moves markets and reveals a method.
Rebuffed by the Supreme Court in June, Trump Revived His Unprecedented Campaign to Fire Federal Reserve Governor Lisa Cook — Reusing the Same Cherry-Picked Mortgage-Paperwork Allegations to Try to Remove, "For Cause," the First Governor Any President Has Ever Sought to Purge in the Fed's 111-Year History, in a Naked Bid to Bend Interest Rates to His Will; Cook Called the Charges Baseless and Turned Them Back on Trump's Own Cabinet
For the first time in the Federal Reserve's 111-year history, a president is trying to fire a sitting governor — and having failed once, Trump is trying again. In 2025 he purported to remove Governor Lisa Cook "for cause," citing a criminal referral from his own housing-finance director, Bill Pulte, that accused her of listing two homes — one in Michigan, one in Georgia — as her primary residence on mortgage paperwork. Cook sued; lower courts blocked the removal; and in late June 2026 the Supreme Court let her keep her seat while the case proceeds (even as it expanded Trump's removal power over other independent agencies). In August 2026, Trump revived the effort with the same allegations. Cook's lawyers answered in a five-page letter to Attorney General Pam Bondi and the White House calling the charges "unfounded and untrue," arguing that "an inadvertent error is not fraud," accusing Pulte of "cherry-picking" mortgage documents to manufacture a referral, and pointedly turning the same kind of paperwork scrutiny back on Trump and members of his own Cabinet. Strip away the mortgage pretext and the real target is the Fed's independence: Trump wants lower interest rates, a governor who will vote for them, and the power to remove any governor who won't. Firing Cook would hand the president direct leverage over the central bank that sets the price of money for the entire economy — the precise outcome a century of law was built to prevent.
DOJ Drops the Powell Probe It Never Had Evidence For — Clearing the Way to Replace Him
Jeanine Pirro's DOJ dropped the criminal investigation into Fed Chair Jerome Powell — the one a judge said had "essentially zero evidence" and existed solely to pressure Powell to resign or lower rates. The quiet part: Sen. Tillis was blocking Kevin Warsh's confirmation as Powell's replacement until the probe was dropped. Now it's dropped. Now Warsh can proceed.
DOJ Admits "We Don't Know" What Crime Powell Committed — Judge Finds "Zero Evidence"
A DOJ prosecutor admitted in a sealed hearing they had no evidence of wrongdoing by Fed Chair Powell. The judge found "essentially zero evidence" of a crime and ruled the investigation's sole purpose was to pressure Powell to lower interest rates or resign.