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Washington just got a little more dramatic. On August 25, President Donald Trump declared that he had fired Federal Reserve Governor Lisa Cook—only to have Cook fire back that she isn’t going anywhere.
In a letter posted on Truth Social, Trump said he was removing Cook from her role, citing allegations raised by Federal Housing Finance Agency Director Bill Pulte that she had misrepresented information on mortgage applications in 2021. The Department of Justice has already signaled it may take a closer look at those claims.
Cook, however, made it crystal clear that she’s staying put. In a statement to USA TODAY, she said the president has “no authority” to fire her and that she has no plans to step down. Her attorney, Abbe Lowell, backed her up, calling Trump’s move “baseless and without legal authority.”
“I will continue to carry out my duties to help the American economy,” Cook said.
Who is Lisa Cook?
Lisa Cook is no stranger to making history. Appointed in 2022 by President Joe Biden, she became the first Black woman to serve as a Federal Reserve Governor. In 2023, she was reappointed to a term running until 2038.
Her resume is impressive: a former professor at Michigan State University, a PhD in economics from UC Berkeley, and past stints as an adviser in both the Treasury Department and the Obama White House. With her deep background in economics and public policy, she’s been a key voice at the Fed table.
What Does She Do at the Fed?
As one of seven Fed governors, Cook helps steer U.S. monetary policy—meaning she plays a direct role in decisions that impact everything from mortgage rates to job growth. She sits on the Federal Open Market Committee, which decides whether to raise, lower, or hold interest rates.
Recently, Cook has generally supported keeping rates steady, even as Trump has loudly called for cuts. Analysts note that she tends to be on the more “dovish” side, leaning toward policies that support workers and consumers.
Can Trump Fire Her?
That’s where things get complicated. The Federal Reserve Act of 1913 does allow a president to remove a governor “for cause.” Trump insists Cook’s alleged mortgage missteps qualify. Cook and her lawyer say otherwise, and a courtroom showdown now seems likely.
Senator Elizabeth Warren has already blasted Trump’s move as “illegal,” while the Congressional Black Caucus says they expect Cook to finish her term.
What Happens Next?
If Trump were somehow successful in removing Cook, it would create a second vacancy on the Fed’s board—at a time when the central bank is already juggling inflation worries and political pressure. But for now, Cook says she’s not stepping down, meaning this fight is far from over.
One thing is certain: the usually buttoned-down world of monetary policy just became a headline-making showdown.
