Trump’s War
Former President Donald Trump has brought the fight to Jerome Powell, the Federal Reserve Chairman. Powell is in the middle of a term that goes out to May of 2026. In fact, Trump just last week posted a similar cartoon image threatening to fire Powell, which underscores the president’s long-stated ire at the Fed’s monetary policy. The latest episode unfolded during a tour of the Federal Reserve Board building on July 24, 2025, where Trump passed Powell a document to fact-check economic numbers, further intensifying their contentious relationship.
This is why Trump is reportedly frustrated with Powell because the President of the United States thinks Powell should be more aggressive in cutting interest rates. With his customary aplomb, Trump has attacked Powell over and over again, calling him “Too Late Powell” for failing to raise rates fast enough. Trump’s threats haven’t stopped Powell from following through. Specifically, he is arguing that his firing is “not allowed” under the law, citing the independence of the Federal Reserve. Removing a sitting Chair of the Federal Reserve would be nothing short of unprecedented in American history. None of his predecessors ever had the guts to go so big.
More recently, Trump has even dialed back on his calls to reform the Fed’s entire operations. Yet, in another section, he still aims his fire at Powell, blaming him for dangerously damaging the economy. During its meeting in March, the central bank lowered interest rates for the first time this year. This reversal in monetary circumstances comes amid Trump’s annual complaints that rates are too high.
As we’ve described, the former president’s continuous criticisms of Powell have included ugly personal attacks not just on Powell but on other Fed officials, too. In August, Trump attempted to fire Fed Governor Lisa Cook for possible mortgage fraud. This decision proved his willingness to challenge the command and control structure of the institution. In spite of these threats, financial markets have mostly been undeterred by Trump’s statements about Powell and Cook.
Many economists and investors are deeply concerned that firing Powell before the end of his term would make long-term interest rates spike. This, in turn, would risk upending the entire financial landscape. As it stands, Powell continues to navigate his role amid political pressures and economic expectations, emphasizing the need for a careful approach to monetary policy.