Last month, I showed you how Trump began reshaping the Fed from the inside, starting with the installation of Stephen Miran — best known as the architect of the Mar-a-Lago Accord.
The next step came last week, when Trump tried to oust Fed Governor Lisa Cook on the basis of mortgage fraud allegations. In more than a century of Federal Reserve history, no president has ever gone that far.
Cook has refused to resign and is now fighting Trump in federal court.
Now, before you dismiss this as politics as usual, look at the sequence. First came Governor Adriana Kugler’s resignation that opened the door for Miran, then the relentless campaign to pressure Powell to cut rates, and now the Cook firing attempt. These aren’t random shots. They’re steps in a systematic takeover of the Fed, the institution at the core of Trump’s Reset.
The pressure appears to be working. At Jackson Hole in August, Powell signaled that “the shifting balance of risks may warrant adjusting our policy stance,” opening the door to rate cuts as early as September.
Notably, this shift came even as he admitted that “the effects of tariffs on consumer prices are now clearly visible.” That’s hardly the backdrop where Fed chairs usually ease. It’s hard not to see this dovish pivot as Powell bending to the drumbeat of Trump’s demands for lower rates.
But clearly, that’s not enough for Trump. So let’s peel this back a layer.
The Math of Fed Control
To understand what’s really going on, you need to look at how the Federal Reserve is built.
The Fed’s Board of Governors has seven seats, and each governor serves a 14-year term. That long horizon was supposedly designed to insulate the central bank from day-to-day politics, so no single president could stack the Board with loyalists overnight. Governors can only be removed “for cause,” which is meant to mean serious misconduct. That’s why Trump’s attempt to fire Lisa Cook is so interesting — he’s pushing to see if the Fed’s supposed protections hold up when the president decides to challenge them. Remember, Cook hasn’t yet been charged with any crime.
Right now, the Board includes Powell, Jefferson, Barr, Cook, Waller, and Bowman, with one vacancy after Adriana Kugler’s resignation. If Trump manages to push Cook out and replace her, while also slotting Stephen Miran into Kugler’s seat, he’ll have four of the seven votes aligned with him. That leaves two Biden appointees, plus Powell in the middle. On paper, that’s a 4–3 split. In practice, it’s a working majority.
Now, the Board doesn’t technically set rates on its own — that’s the job of the Federal Open Market Committee (FOMC). But a Board majority still matters enormously. It controls regulation, oversees Wall Street, and approves regional Fed presidents. It also signs off on emergency lending facilities. And maybe most importantly, it sets the tone. Four governors voting and speaking in lockstep are enough to tip the center of gravity inside the FOMC.
The Overhaul Agenda
So of course, the pundits are out calling it a “dangerous blow” to Fed independence.
Maybe so — if “Fed independence” were ever real. But the facts tell a different story. For most of its history, the Fed has marched in step with whoever’s in the White House. Economist Robert Weintraub, after looking at the 1950s through the ’70s, put it plainly: “the dominant guiding force behind monetary policy is the President.”
Which brings us to the real question: what’s Trump actually after here?
To answer that, we have to come back to Stephen Miran. In March 2024, he co-wrote a paper titled “Reform the Federal Reserve’s Governance to Deliver Better Monetary Outcomes,” calling for a total overhaul of Fed governance. The plan included: shortening governor terms from 14 years to 8, giving presidents the power to fire them, shifting more authority to the regional Fed banks, and putting the Fed’s budget under Congress.
More recently, Miran has doubled down on his Fed reform agenda. After his nomination in August, he again called for “remaking Fed governance to give the president far stronger control over the U.S. central bank, including the right to fire its leadership at will.”
Trump seemed to like these ideas so much that, right after going after Lisa Cook, he floated the idea of shifting Miran into her seat instead of Kugler’s — because it offered far more staying power. Cook’s slot doesn’t expire until 2038, while Kugler’s would have ended in 2026. In other words, the Cook seat means more than a decade of influence versus just a year or so — a much longer runway for Miran and Team Trump to push their overhaul plans.
Granted, the legal fight over Cook’s removal could drag on for months. But Trump has already made his point: Fed governors aren’t untouchable anymore.
Regards,
Lau Vegys
P.S. The battle for control of America’s monetary policy is intensifying. And understanding that battle — and its place in the broader Trump Reset — will be crucial for protecting and growing your wealth in the years ahead.
One point of disagreement I have is that the Federal Reserve Act did not define "for cause," although that term may be used in other federal documents. If it is, then I withdraw my objection.
However, I will note that President Trump is making some incredible moves for someone that his opponents have tried to enforce upon him, like their efforts to de-bank him. After that, I would have never believed he would support the idea of getting rid of the penny, since real coinage is an escape from the banking system.
A final note for the uninitiated: "Incredible" does not mean "wonderful"; it means "not believable".
The FED is a clandestinely founded instititution by the London based international banking cartel (1913). Neither independent nor federal are true. We can currently again observe a great show.