Bloomberg Businessweek Trump Says He’s Prepared for Fight Over Cook’s Ouster From Fed
Aug 26, 2025
Kathryn Judge, a banking law expert from Columbia Law School, joins Bloomberg News equities reporter Bailey Lipschultz to unpack President Trump's legal battle over Federal Reserve Governor Lisa Cook's ouster. They delve into the implications of presidential authority on the Fed's autonomy and highlight concerns over due process. The conversation shifts to market dynamics, where they examine investor sentiment amidst regulatory changes and trends in SPACs, while also addressing the future of tech investments fueled by AI enthusiasm.
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For-Cause Removal Is Legally Unclear
- The legal basis for firing a Fed governor for cause is unclear and untested.
- Kathryn Judge argues allegations alone likely won't satisfy the statutory "for cause" protection.
Statutory Protections Preserve Fed Independence
- The Fed's statutory structure protects governors from political removal to preserve independence.
- Judge says removing Cook for policy reasons would violate that long-standing congressional design.
Congress Should Insist On Due Process
- Congress should publicly defend the 1935 statutory scheme and insist on process before removals.
- Judge recommends hearings or due process to give the "for cause" rule real meaning.
