The Story Why Trump's attack on the Fed affects us all
Aug 28, 2025
Mehreen Khan, Economics Editor at The Times, discusses the recent firing of Federal Reserve board member Lisa Cook by Trump and its potential global economic impacts. She delves into the alarming trends of political interference in monetary policy, drawing parallels to past crises. The conversation highlights concerns about the Fed's independence, rising inflation, and the looming threat of stagflation in the U.S. Khan emphasizes the importance of maintaining trust in financial institutions to avoid future economic turmoil.
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Fed's Global Role And Core Mandate
- The Fed's core job is to control inflation using interest rates and target roughly 2% inflation.
- Because the US dollar is the global reserve currency, Fed decisions carry outsized global impact.
Targeting The Institution, Not Just The Chair
- Attacks on the Fed now focus on its policymaking body, not only its chair, risking institutional independence.
- Eroding that institutional protection could have larger consequences than targeting a single individual.
An Unusually Public Presidential Visit
- Donald Trump visited the Fed building with cameras and stood next to Jerome Powell in a high-profile, intimidating press event.
- That physical presence was extraordinary because presidents rarely visit the Fed's premises.