Big Take Why Trump Is Trying to Fire Lisa Cook
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Aug 26, 2025 Michael McKee, Bloomberg's international economics and policy correspondent, breaks down President Trump's recent move to dismiss Federal Reserve Governor Lisa Cook. They explore the legal intricacies of such a dismissal and its ramifications for Fed independence and public trust. The discussion dives into the broader consequences of political pressure on economic decisions, particularly how it might affect monetary policy and the integrity of economic governance. McKee's insights shed light on the potential storm brewing between politics and economic autonomy.
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Trump Announces Cook's Removal
- President Trump publicly announced he had "determined there is sufficient cause to remove" Fed Governor Lisa Cook over alleged mortgage fraud.
- The legality of that firing is unclear and Cook says she'll fight it in court.
'For Cause' Standard Is Central
- The Federal Reserve Act allows removal of a governor only "for cause," which typically means inefficiency, neglect, or malfeasance.
- Allegations predate Cook's Fed service, so courts would likely need to decide if they meet the legal bar.
FHFA Flagged Mortgage Discrepancies
- The FHFA director flagged that Cook signed mortgage papers in Michigan and later in Georgia claiming each as permanent residence.
- FHFA sent documents to DOJ, which has opened an investigation but released no public evidence yet.