Trump Announces Dismissal of Federal Reserve Board Member Cook; Cryptocurrency Market Responds with Decline
U.S. President Trump announced on August 25 local time via his social media platform "Truth Social" that he is immediately dismissing Federal Reserve Board Member Lisa D. Cook from her position.
This action is based on the powers granted by Article II of the U.S. Constitution and the Federal Reserve Act of 1913. In a public letter to Cook, Trump stated that he has determined there is "sufficient reason" to remove her from office.
Reportedly, the main reason for this dismissal is Cook's alleged provision of false information in mortgage agreements. According to a criminal referral report submitted by the Federal Housing Finance Agency on August 15, Cook is accused of making false statements when applying for two property mortgages in 2021.
The report states that Cook initially declared a property in Ann Arbor, Michigan, as her "primary residence" in one document, and just two weeks later made the same declaration about another property in Georgia in a different document.
Trump criticized this behavior in his letter as "unimaginable" and questioned her integrity and competence as a financial regulator.
Cook was nominated by former President Biden to the Federal Reserve Board in 2022, with her term originally set to end in 2038. She is also the first African American woman to hold this position in the history of the Federal Reserve.
The incident began to escalate after the allegations submitted by Federal Housing Finance Agency Director Bill Pulte on August 15. Trump immediately called for Cook to "resign immediately" on social media, but Cook refused to resign under "duress." A week later, Trump directly announced the dismissal decision.
Analysts believe this dismissal is seen as an important step for Trump in trying to expand his influence over the Federal Reserve. He has long criticized the Federal Reserve's monetary policy, particularly advocating for more aggressive interest rate cuts.
If Cook's resignation proceeds smoothly, Trump will have the opportunity to nominate a fourth Federal Reserve Board member, potentially forming a majority within the seven-member board that could further influence future interest rate decisions and banking regulatory policies.
The market reacted quickly to this move, with the U.S. Dollar Index and cryptocurrency market declining in response, while spot gold prices saw a short-term surge.
Analysts point out that the dismissal action has raised concerns about the independence of the Federal Reserve and could likely trigger legal challenges. If Cook files a lawsuit, the case may ultimately need to be decided by the Supreme Court.