The Supreme Court hears Trump case: a confrontation between presidential power and the independence of the Federal Reserve

The U.S. Supreme Court today heard the case “Trump v. Federal Reserve Board Cook,” and a series of questions raised by Chief Justice Roberts during the hearing profoundly reveal the core controversy of this litigation. This is not only a legal case concerning individual conduct but also an important test of the boundaries of power within the American political system.

Interpretation of the Core Issues of the Case

According to the latest news, Chief Justice Roberts posed three key questions during the hearing, directly addressing the essence of the case:

These questions from the Chief Justice signal an important message: the court has doubts about the arguments concerning the Federal Reserve’s status and the scope of presidential power. Especially the last question directly touches on the fundamental issue of this case—the stability of the Federal Reserve’s status as an independent institution.

The Deep Meaning of Power Disputes

Essentially, this case is about answering a fundamental constitutional question: How broad is the President’s authority over the Federal Reserve? As the central bank of the United States, the Fed’s independence is crucial for financial market stability. If the Supreme Court ultimately rules that the President has broader removal powers, it could disrupt the long-standing independent operation model of the Federal Reserve.

According to the latest news, Federal Reserve Chair Jerome Powell’s term will end on May 15, and current White House economic advisor Kevin Waugh has become the leading candidate to succeed as the next Fed Chair (with an estimated probability of about 60%). This timing coincides interestingly with the Supreme Court case: the court is examining presidential power, while the executive branch is making personnel changes for the Fed Chair position.

Why the Market Is Paying Attention to This Case

From related information, it is clear that the market’s reaction to policy uncertainty has become very sensitive. After Trump announced tariffs on Europe, the cryptocurrency market experienced a significant decline:

• Bitcoin dropped from a high of $97,000 to $92,000, a decline of over $4,000
• Ethereum fell below $3,200
• Over $593 million in liquidations across the network, with longs accounting for nearly 90%

This market reaction reflects investors’ concerns about policy uncertainty. The Supreme Court’s ruling on presidential power could further influence market expectations regarding policy stability.

Chain Reaction of Power Uncertainty

If the Supreme Court ultimately supports the idea that the President has broader removal powers over the Federal Reserve, it means:

• The independence of the Fed could be weakened
• Monetary policy might become more susceptible to political influence
• Confidence in policy stability and predictability could decline
• Investors might increase allocations to defensive assets (such as gold)

Related information shows that gold prices have already broken through $4,630, reaching a record high, which is a typical market response to uncertainty.

Future Outlook

The final ruling of this case may be announced within months. Against the backdrop of changing Fed leadership, rising policy uncertainty under Trump, and escalating international trade frictions, the Supreme Court’s decision will be a key factor influencing market expectations.

According to related reports, the U.S. Senate Agriculture Committee plans to release a cryptocurrency market structure bill on January 21 (today), indicating that regulatory frameworks for the crypto industry are evolving rapidly. In this context, the issue of the Fed’s independence becomes even more important—it relates to the future attitude of the U.S. financial system toward crypto assets.

Summary

This Supreme Court case, on the surface, concerns Cook’s personal conduct and the status of the Federal Reserve, but its deeper significance lies in defining the boundaries of presidential power within the U.S. political system. Chief Justice Roberts’ questions reflect the court’s cautious attitude toward the key issues of the case. Regardless of the final ruling, this case will have significant implications for the Fed’s independence, the scope of presidential authority, and market expectations of policy stability. In an environment of high policy uncertainty, ongoing attention to the case’s development is essential.