The head of the Federal Housing Finance Agency took to CNBC on Thursday morning to defend Donald Trump’s firing of Dr. Lisa Cook, a member of the Federal Reserve board of governors. During a contentious interview, Bill Pulte—the Trump appointee who publicly accused Cook last month of committing mortgage fraud and has claimed to have invented “Twitter philanthropy”—insisted Cook’s firing was not politically motivated, refused to divulge his “sources and methods,” and told cohost Andrew Ross Sorkin, “I don’t need you to help me explain things, Andrew.”
But let’s explain how we got here. Throughout his first term and for most of his second, Trump has been extremely angry with the Federal Reserve, whose policymakers he apparently thinks know less about being good stewards of the economy than he does, a man whose companies have filed for Chapter 11 bankruptcy six times. Often, that anger has resulted in Trump publicly lashing out at Fed chair Jerome Powell, whom the president has called, among other things, “low IQ,” “a stubborn mule,” “a very stupid person,” and “a knucklehead.” But in late August, the president turned his ire on Cook, whom he accused of committing mortgage fraud and fired via Truth Social, a move he would undoubtedly like to follow up by replacing Cook with someone inclined to give him what he wants, i.e., lower interest rates. Cook has denied the fraud allegations and sued the president, saying he lacks the cause to get rid of her. Where do things stand? What does it mean for the economy? Who is this Bill Pulte guy? Your burning questions, answered.
What has Trump accused Cook of doing?
In a letter posted to his Truth Social account on August 25, Trump accused Cook of committing mortgage fraud, specifically claiming that she indicated on 2021 mortgage documents that both her home in Michigan and her house in Georgia would be her primary residence. He wrote that he was removing her from her position “effective immediately” and added, “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.” On Thursday, The Wall Street Journal reported that Trump’s Justice Department had opened a criminal investigation into the allegations against Cook.
How has Cook responded?
Cook has denied the accusations, with her attorneys declaring in a court filing that she “did not ever commit mortgage fraud.” Cook’s lawyers—who have sued the president on her behalf—also told a judge that even if she had done the things Trump has accused her of, they would not rise to the level at which he could fire her for cause, particularly in light of the Fed’s status as an independent organization. “Setting aside the fact that Governor Cook did not ever commit mortgage fraud, any such pre-office offense plainly would not have been ‘so infamous a nature, as to render the offender unfit to execute any public franchise,’” they wrote. Cook’s team has argued that her firing was politically motivated and tied to Trump’s anger at the Fed for not lowering interest rates this year; they’ve also claimed her due process rights were violated when she was not given an opportunity to respond to the allegations prior to being fired. Cook’s attorney Abbe Lowell—whose previous clients have included Jared Kushner and Ivanka Trump—has said Trump’s “reflex to bully is flawed and his demands lack any proper process, basis, or legal authority.” In response to the news of the DOJ probe, Lowell told the Journal, “The questions over how Governor Cook described her properties from time to time…are not fraud, but it takes nothing for this DOJ to undertake a new politicized investigation, and they appear to have just done it again.”
Who is Bill Pulte?
Pulte is the director of the Federal Housing Finance Agency and Trump’s most prominent soldier in the crusade against Cook. On August 20, he posted a letter on X in which he claimed Cook “falsified bank documents and property records to acquire more favorable loan terms, potentially committing mortgage fraud.” The same day, Trump demanded via Truth Social that Cook resign; five days after that, he fired her. Pulte has similarly accused Trump foes Adam Schiff and Letitia James of committing mortgage fraud. (According to NBC News, Attorney General Pam Bondi has appointed a “special attorney” to investigate the Democrats; Both Schiff and James have denied the allegations.)
During his interview with CNBC on September 4, Pulte refused to offer any details re: where he obtained the “tip” that led him to accuse Cook of fraud, telling the hosts, “I’m not going to explain our sources and methods, where we get tips from, who are whistleblowers.” When CNBC’s Sorkin told Pulte that Cook’s targeting could be considered “political weaponization,” and said that if “the tip came from inside the administration, or came from even inside your agency, with somebody who works for you…then that creates the perception issue,” Pulte angrily responded, “I don’t need you to help me explain things, Andrew.” Asked if he was also looking into reports that Republican Texas attorney general Ken Paxton has listed three properties as his primary residence, Pulte said, “If things are made public then, and/or if we decide to make them public, then I will talk about it.”
Is Cook the first person Trump has fired via social media?
Of course not. Others have included former secretary of state Rex Tillerson, and more than a thousand federal employees appointed by Joe Biden.
What does it mean for the Fed if Trump is able to remove Cook from her post?
It wouldn’t be great! “This is a kill shot at Fed independence,” Brookings Institution senior fellow Aaron Klein told Bloomberg. “Trump is saying the Fed is going to do what he wants it to do, by hook or by crook.” A letter signed by hundreds of economists condemns Cook’s firing and the “unproven accusations” against her, declaring they “threaten…the fundamental principle of central bank independence and undermine…trust in one of America’s most important institutions. That trust is a cornerstone of the system that has fueled America’s economic vitality over the decades.”
