Global financial authorities expressed unprecedented solidarity following the Trump administration's criminal investigation into Federal Reserve Chair Jerome Powell, signaling profound alarm.
Details:
- The Department of Justice has launched a criminal investigation into Federal Reserve Chair Jerome Powell over alleged cost overruns at the central bank's headquarters.
- This executive inquiry coincides with President Trump's public demands for a rapid reduction in the federal funds rate, currently 3.5%-3.75%, to a preferred 1%.
- A rare joint statement from global central bankers, including the ECB and Bank of England, affirmed their "full solidarity" with Powell, citing central bank independence as a "cornerstone of stability."
Why it Matters:
The implications extend beyond mere budgetary oversight. This executive intervention, paired with a pivotal Supreme Court case on presidential removal powers, directly challenges the institutional independence vital for impartial economic governance. As Madison stated in *Federalist No. 50*, 'the provision for the security of public liberty requires that in fact there should be no such accumulation of all powers in the same hands.' Such sustained executive pressure, mirroring colonial grievances against unchecked royal prerogative, jeopardizes the Fed's credibility and global financial stability. Asserting direct presidential authority over monetary policy risks transforming a cornerstone of economic stability into a political instrument, threatening every mortgage rate and grocery bill.