Former CEA chair on Powell investigation: Market is correctly betting Trump will not succeed

Summary

Jason Furman, former CEA chairman and Harvard Kennedy School professor, joins the show to discuss the DOJ investigation into Fed Chair Jay Powell and a joint letter warning that threats to Fed independence harm the economy. He argues the probe is counterproductive because it makes Powell more likely to stay and FOMC members less likely to cut rates further. Furman says the market is correctly betting Trump will not succeed in pressuring the Fed. The conversation also covers inflation risks and the credibility of the next Fed chair.

• DOJ investigation into Powell prompts warnings from former economic officials.
• Furman says threats to Fed independence could harm inflation and economic functioning.
• He argues the probe makes further Fed rate cuts less likely.
• Furman says markets correctly expect Trump's pressure campaign to fail.
• He calls for the investigation to be dropped and for a new Fed chair to defend the institution.
• The interview highlights institutional credibility and inflation risks.