Trump dismisses Fed governor over allegations

A confrontation between politics and central banking unfolds as Trump threatens to remove a Fed governor amid mortgage allegations.

Trump threatens to fire Fed Governor Lisa Cook if she resigns

President Donald Trump said he will fire Federal Reserve Governor Lisa Cook if she does not resign from her post. Cook, a Biden appointee, has faced questions after FHFA Director William Pulte accused her of mortgage fraud and the Justice Department said it will investigate. Cook has consistently voted with Fed Chair Jerome Powell on policy decisions.

Cook said she has no intention of stepping down and will answer questions about her finances. She said she learned from the media that Pulte posted about a criminal referral. The clash shows how politics can touch central bank governance and raise questions about independence and public trust.

The episode highlights a long standing tension between political pressure and central bank independence. When a president publicly threatens a senior official, it risks eroding confidence in the Fed’s decision making. The article shows how allegations against a regulator can become a political weapon even as the Fed maintains autonomy.

Observers will watch for how lawmakers respond and whether legal processes proceed. The mix of an ongoing investigation, a pending resignation, and a central bank that cannot be easily fired by the president creates a slippery dynamic.

Highlights

The coming days will test the boundary between politics and central bank governance.