U.S. President Donald Trump announced the firing of Federal Reserve Governor Lisa Cook, raising questions about the reliability of the dollar.
In a post on Tuesday, the White House's rapid response X account published a letter signed by Trump, dismissing Cook from her position at the Federal Reserve. He accused her of making false statements regarding one or more mortgage agreements and wrote directly to her:
According to a report by the Associated Press on Tuesday, Cook stated that she would not resign. She said Trump was attempting to "legally" remove her from her position but claimed that "there is no legal basis" for it, adding that Trump "does not have the power" to dismiss her. She concluded by saying she "will not resign."
The Federal Reserve is largely independent of the U.S. government. Alex Obchakevich, founder of Obchakevich Research, told Cointelegraph that the independence of the Federal Reserve "is the foundation of U.S. economic stability." He explained:
Obchakevich believes Trump's decision to fire Cook was for "political reasons," and that his decision undermines the independence of the Federal Reserve. He stated that this leads to market uncertainty and worsens economic sentiment, adding:
When asked if Bitcoin (BTC) could be a potential solution, Obchakevich said that in the long term, "Bitcoin could undermine the dollar's role as a reserve currency." However, he noted that Bitcoin does not seem to be a solution in the near term.
This news comes after repeated conflicts between Trump and the Federal Reserve leadership. In mid-April, Trump criticized Federal Reserve Chairman Jerome Powell for allegedly being too slow to cut interest rates amid the trade war initiated by the U.S.
He even suggested firing Powell. "The sooner Powell is fired, the better!" Trump said.
Market participants quickly rejected this idea. Noted cryptocurrency entrepreneur Anthony Pompliano stated that Trump should not follow through on his threat to fire Powell.
"I don't think the President of the United States should come in and unilaterally fire the Chairman of the Federal Reserve," he said. He believes this action would set a bad precedent.
U.S. Senator Elizabeth Warren also warned that if Trump were to fire Powell, it could undermine investor confidence in the integrity of U.S. capital markets and trigger a financial collapse.
Related: Trump's Crypto Empire: The Business Collision of Suits and Tattoos
Original article: “Trump Fires Fed Governor, Raising Questions About Dollar Stability”
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