Fed Issues Statement Over Trump Firing Of Governor Cook, Dems Play Race-Card

Update (1505ET): The Fed appears to stand by Governor Cook (for now) with a weaselly statement:

“Lisa Cook has indicated through her personal attorney that she will promptly challenge this action in court and seek a judicial decision that would confirm her ability to continue” on the Board of the Federal Reserve System, the Fed says in a statement.

“As always, the Federal Reserve will abide by any court decision”

A statement that removes Powell from the fray for now… but we would expect a rapid response from Trump who earlier stated he was ready for a legal battle.

“Oh sure, always,” Trump said at a Cabinet meeting at the White House on Tuesday.

“She seems to have had an infraction, and she can’t have an infraction — especially that infraction, because she’s in charge of, if you think about it, mortgages.”

Presumably, The Fed’s statement combined with Bill Pulte’s receipts on her actual alleged fraudulent mortgage applications suggests she will be forced out by the facts sooner rather than later.

“I abide by the court,” President Trump says when asked to comment on the Federal Reserve’s statement that it will abide by any court decision issued regarding Lisa Cook.

Of course, The Democrats have already played the race card, claiming there is ‘no credible evidence’ (which is simply a lie) and remind the world she is the first black Fed Governor:

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Update (0830ET): Mainstream media is abuzz this morning with the news of Trump’s firing of Fed Governor Cook over her alleged mortgage cheating. Given that she has apparently refused to leave, this puts The Fed (and in particular Chair Powell) in an awkward position.

As Jim Bianco explains in a brief post on X: 

If they allow her to continue with her duties as Fed Governor, starting this morning, and the courts find that the President does have the authority to fire her, even if it’s months later during an appeal, anything she does on behalf of the Fed as a Governor starting today will not be valid.

And the Fed could be held responsible for allowing a non-employee to continue to act like an employee.

Restated, if the Fed allows her to stay and continue to be a Governor, and the court rules that Trump can fire her (again, even if it is later in an appeal), then Jay Powell has potentially committed a “for-cause” offense for which he could be fired.

(allowing a non-Fed employee to make decisions and policy on behalf of the Federal Reserve.)

Additionally, Cook has hired former first son Hunter Biden’s lawyer, Abbe Lowell, to represent her. 

In a statement, Lowell vowed to take “whatever actions are needed” to stop what he described as Trump’s “illegal action.”

ICYMI: Of all the 1,322,649 active lawyers in the US, Lisa Cook hired Abbe Lowell, who represented Hunter Biden https://t.co/y2zU7HxImu

— zerohedge (@zerohedge) August 26, 2025

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As a reminder, Fed Governors resigning is not unusual in recent years:

• 2021: Dallas Fed president Kaplan busted for suspicious stock trades, resigns

• 2021: Boston Fed president Rosengren busted for suspicious stock trades, resigns

• 2022: Fed vice chair Richard Clarida busted for suspicious trades, resigns

• 2025: Lisa Cook vows to stay on

“President Trump has no authority to remove Federal Reserve Governor Lisa Cook,” Cook’s lawyer, Abbe David Lowell, says in a statement.

“His attempt to fire her, based solely on a referral letter, lacks any factual or legal basis,” Lowell says of Trump.

“We will be filing a lawsuit challenging this illegal action.”

This is far from over.

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Update (2330ET): Former Fed governor Lisa Cook says she will not resign, the Washington Post reports, citing a statement from Cook.

“President Trump purported to fire me ‘for cause’ when no cause exists under the law, and he has no authority to do so,” Cook said through a spokeswoman: WaPo

“I will continue to carry out my duties to help the American economy as I have been doing since 2022,” Cook said

Good luck with that plan when the FBI turns up tomorrow at your place of work.

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Promises made… promises kept…

On Friday, President Trump warned that he would fire Federal Reserve Governor Lisa Cook who allegedly “falsified bank documents and property records to acquire more favorable loan terms” if she didn’t resign…

.@POTUS on Federal Reserve Governor Lisa Cook: “I’ll fire her if she doesn’t resign. What she did was bad, so I’ll fire her if she doesn’t resign.” pic.twitter.com/1vEv7k7ar8

— Rapid Response 47 (@RapidResponse47) August 22, 2025

She immediately played the victim card, claiming she “would not be bullied”.

But now that is moot as President Trump has fired her, effective immediately:

” I have determined that there is sufficient cause to remove you from your position…

…

The Federal Reserve has tremendous responsibility for setting interest rates and regulating reserve and member banks. The American people must be able to have full confidence in the honesty of the members entrusted with setting policy and overseeing the Federal Reserve.

In light of your deceitful and potentially criminal conduct in a financial matter, they cannot and I do not have such confidence in your integrity.

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.”

Full letter below: 

Trump will now have a majority on the Fed Board…

If/when Cook leaves/is fired, Trump will have a majority on the Fed board pic.twitter.com/6Hxn8f2PPw

— zerohedge (@zerohedge) August 21, 2025

Trump was quick to make note of her dismissal on Truth Social:

Reminder, The Fed is not political… etc, etc…

Exactly 6 years later, Trump has an answer to Dudley’s op-ed https://t.co/sHwvmxAKhp

— zerohedge (@zerohedge) August 26, 2025

There is a silver lining for her…

The good news is Cook will soon be able to refinance at a much lower rate. https://t.co/5Coxyp8iDd

— zerohedge (@zerohedge) August 26, 2025

How long before Democrats decry this racist act and demand it be appealed all the way to SCOTUS?

Or will she skulk away sheepishly admitting she broke the law rather than face the discovery that Bill Pulte has already exposed?

There was a notable market reaction to this move with gold rallying as the dollar dropped and short-end bonds are bid (stocks lower)…

With rate-cut odds rising for Sept and more for December.