1A Trump’s Battle With The Federal Reserve
Sep 10, 2025
Amara Amokwe, a Federal Reserve and economy reporter at Bloomberg, dives into Donald Trump’s contentious relationship with the Federal Reserve. She discusses the implications of Trump's attempts to remove Fed Governor Lisa Cook amid unproven allegations. The conversation reveals potential threats to the Fed's independence and how these conflicts could impact monetary policy and the U.S. economy. Amokwe highlights the disconnect between economic indicators and everyday experiences, raising crucial questions about trust and governance in economic decision-making.
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How The Fed Sets Rates
- The Fed sets short-term interest rates through a committee that combines seven governors and 12 regional bank presidents.
- Independence shields policy from political pressure so decisions focus on long-term inflation and employment goals.
Why Fed Independence Exists
- Congress designed the Fed to be insulated from short-term politics to avoid chronically low interest rates and higher inflation.
- That insulation lets the Fed take a long-term view on price stability and employment.
Myron's Controversial Dual Role
- Stephen Myron is Trump's CEA chair and an ally who proposed taking unpaid leave rather than fully resigning if confirmed to the Fed.
- That partial separation raised concerns about conflicts and added pressure on the Fed for lower rates.