Sen. Elizabeth Warren, D-Mass., warned Thursday that U.S. markets will “crash” if Federal Reserve Chairman Jerome Powell can be fired by President Donald Trump.
The comment from Warren, a frequent Powell critic, on CNBC’s “Squawk on the Street” came hours after Trump griped that the Fed chair’s “termination cannot come fast enough!”
“I have tangled with [Powell] on a regular basis about both regulations and interest rates,” Warren acknowledged in her remarks at the New York Stock Exchange.
“But understand this: If Chairman Powell can be fired by the president of the United States, it will crash markets in the United States,” she said.
Warren, the ranking member on the Senate Banking Committee, explained that the “infrastructure” upholding the stock market — and therefore the global economy — is “the idea that the big pieces move independent of the politics.”
If key economic levers are “subject to a president who just wants to wave his magic wand,” then the U.S. will be indistinguishable “from any other two-bit dictatorship around the world,” she said.
Trump has repeatedly singled out Powell by name as he urges the U.S. central bank to lower interest rates in hopes of spurring rapid economic growth.
After hiking rates at the start of President Joe Biden’s presidency in order to tamp down the rampant inflation induced by the coronavirus pandemic, the Fed started dialing rates back in 2024.
But the Fed under Powell has said it is in no hurry to continue those cuts, pointing to the uncertainty created by Trump’s shape-shifting tariff policies.
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