CNBC Anchor Grills Top Econ Adviser on Fed’s ‘Credibility’ Under Trump: ‘Can You Understand The Concerns?’

The anchors of CNBC’s Squawk Box grilled National Economic Council head Kevin Hassett Monday over the Federal Reserve’s credibility under Donald Trump amid his efforts to remove Fed governor Lisa Cook.

Last week, the White House sent Cook a letter notifying her that “the President is considering removing you from your position on the Board of Governors with the Federal Reserve due to there being sufficient reason to believe that you made false statement on one or more mortgage agreements.”

Host Andrew Ross Sorkin said to Hassett, “The other big question I wanted to ask you about this morning is the news around Lisa Cook, the effort by the White House potentially to remove her, and how do you think about the independence of the Fed in this context. We were talking about, you know, the way Jay Powell has approached this, the way Kevin Warsh may approach this. By the way, I don’t know if you think if Lisa Cook does get removed, whether you ultimately could get that job.”

Hassett demurred, answering, “No, I promise you that’s not going to happen.”

“But you know, I think it’s a law enforcement matter. I look forward to seeing — if you look at the Supreme Court ruling, it said that basically she was given insufficient notice. And so now she’s been given notice,” Hassett said. “I look forward to seeing what she has to say. She says that she’s 100% innocent. You know, as a human being, I hope that’s true. But I think that if in the end there is a cause then, of course, the president has the right to fire her whether there is or not. That’s a law enforcement matter. Now, I’m an economist. I can’t add anything to it right now.”

Co-host Melissa Lee asked, “Can you understand, though, Kevin, the concerns about surrounding Fed credibility and the president wanting to remove Lisa Cook on the heels of these reports that he and Kevin Warsh have had several meetings together?”

“Well, the president and Kevin Warsh have been talking together for 20 years,” Hassett began. “You know, I’ve been friends with both of them for a very long time. The president trusts his judgment. Kevin is the new chair. He’s got some members that agree with him on everything, perhaps, and some that don’t. And they have lively debates. And that’s the way the fed is supposed to be.”

“Kevin Warsh is as independent as it comes. If the president were to tell him to do something, he wouldn’t do it, but he would argue about why he’s not doing it if he thought it was the wrong thing to do,” Hassett added.

Watch the clip above via CNBC.

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