Trump reveals who could replace Fed Governor Lisa Cook as she readies to battle firing in court
&imwidth=600&imheight=450&format=webp&quality=medium "Trump reveals who could replace Fed Governor Lisa Cook as she readies to battle firing in court")
US President Donald Trump, Federal Reserve Governor Lisa Cook Photograph: (Combination created using images from AFP)
Federal Reserve Governor Lisa Cook's team has announced plans to sue President Donald Trump after he fired her. Trump, who cited allegations of mortgage fraud as "sufficient cause" for the dismissal, has already named potential nominees to replace Cook.
US President Donald Trump on Tuesday (Aug 26) told his advisers that he wanted to move quickly to announce a nominee to replace Federal Reserve Governor Lisa Cook, according to a Wall Street Journal report citing people in the know. Trump also provided reporters proof of his impatience in replacing Cook as he told them at the White House, "We have some very good people for that position". However, the Fed reserve governor won't go down that easily. Also on Tuesday, Cook's attorney, Abbe Lowell, announced that his team was filing a lawsuit challenging Trump's attempt to fire her. On Monday evening, Trump shared on Truth Social a letter he had sent to Federal Reserve Governor Lisa Cook, firing her. In what marks the latest escalation in Trump's attack on the central bank's independence, the POTUS, in his letter, told Cook he was removing her from her position "effective immediately".
Who does Trump want to replace Cook with?
According to the WSJ report, Trump has said that he might appoint loyalist Stephen Miran to replace cook. Miran, an economic adviser close to Trump, was appointed to fill a different seat on the Fed's board. His term expires in January. Meanwhile, the term for Cook's seat would expire in 2038 and Trump said, "We might switch him to the other—it's a longer term".
However, Miran is not the only contender for Cook's post. Citing anonymous people, the report adds that former World Bank Group President David Malpass, a close ally of the president, is also in the running. Malpass earlier criticised the Federal Reserve for not lowering interest rates, a sentiment trump shares. It is also reported that Malpass could also take Miran's current post if the latter replaces Cook.
Cook files lawsuit against Trump
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In a statement to CNN, Cook's attorney Lowell insisted that Trump has "no authority" to fire Cook. "His attempt to fire her, based solely on a referral letter, lacks any factual or legal basis. We will be filing a lawsuit challenging this illegal action," he said.
Why did Trump fire Cook?
Trump, in the full text of his letter to Cook, stated that he has "determined that there is sufficient cause" in the allegations against her to fire her. “At a minimum, the conduct at issue exhibits the sort of gross negligence in financial transactions that calls into question your competence and trustworthiness as a financial regulator,” he added in his letter.
However, reports suggest that Cook's ignoring Trump's demands for lower interest rates could be behind the move. As per the Guardian, Cook's removal — a Joe Biden appointment — would allow Trump to bring in a replacement that would essentially give him more control of the federal policy.
What are the allegations against Cook?
The attack on Cook was led by Trump loyalist Bill Pulte, who was appointed by the POTUS to lead the US Federal Housing Finance Agency. He alleged that the federal officer had claimed two different properties as her primary residences while obtaining mortgages in 2021. On X, Pulte wrote, "How can this woman be in charge of interest rates if she is allegedly lying to help her own interest rates?" while referring the case to the Department of Justice for investigation.
