It's showdown time for the Fed's independence at the Supreme Court

"The U.S. Supreme Court hears arguments Wednesday in a case that has Wall Street and the financial markets in a near panic. At issue are President Trump's efforts to break with 112 years of law and precedent by firing Lisa Cook, a member of the Federal Reserve's governing board appointed by President Biden. Cook's case is not unique, as evidenced by the recent blow up between Trump and Jerome Powell, who was appointed Fed chair in 2018 by Trump himself."

"The normally reticent Powell finally blew. "This new threat is not about my testimony last June or about the renovation of federal reserve buildings. Those are pretexts," Powell said in a video posted on social media. "The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public rather than following the preferences of the president.""

The Supreme Court is hearing a case that has Wall Street and financial markets in near panic over executive efforts to remove a member of the Federal Reserve's governing board. President Trump seeks to fire Lisa Cook, breaking 112 years of law and precedent that protect Fed governors from removal except for malfeasance. The dispute mirrors tensions with Fed Chair Jerome Powell, who faced grand jury subpoenas on Jan. 9 tied to testimony about renovation cost overruns. Powell described the investigation as a pretext and said the real dispute concerns the Fed setting interest rates to serve the public rather than following presidential preferences. Congress created the Federal Reserve in 1913 to insulate monetary policy from political manipulation by establishing limited terms and removal only for cause.

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