Finance

Since Donald Trump returned to the White House, American investors have received one shock after another—so it really takes something to get them to jump these days. Announcements that not long ago would have been bombshells, such as the president deciding to levy a tariff of 50% on copper or 30% on the European Union prompt a shrug. A rare exception came on July 16th, when Mr Trump seemed to contemplate sacking Jerome Powell, chair of the Federal Reserve, but even then the reaction was relatively muted: a pop in Treasury yields and slump in the dollar. Mr Trump reversed course; business got back to normal. The following day American stockmarkets hit all-time highs. More

If President Donald Trump tries to fire Federal Reserve Chair Jerome Powell, it would set off a courtroom battle that would likely head to the Supreme Court.
Most people familiar with the situation say Powell would sue if Trump tries dumping him.
Despite seemingly low chances of success, going after Powell still could serve a political purpose for Trump.
Even if the Fed did cut rates, it could do more harm than good to Trump’s goal of lowering finance costs on the national debt.

U.S. Federal Reserve Chair, Jerome Powell and U.S. President Donald Trump.
Annabelle Gordon | Kevin Lamarque | Reuters

If President Donald Trump tries to fire Federal Reserve Chair Jerome Powell, it would almost certainly set off a courtroom battle that legal and policy experts say is bound to get messy, with uncertain impacts on the central bank, financial markets and the economy.
The tempestuous situation poses a myriad of thorny questions for which there are no easy answers considering no president ever has tried to unseat a Fed chair.

Among them:

Does Trump have the authority to remove Powell? The answer is almost certainly no, not without meeting the legal threshold of “cause.” However, that raises additional questions over what would constitute cause, with growing suspicion in Washington and Wall Street that the president is using criticism over the Fed’s building expansion as a pretext to establish that condition.
What happens next from a legal standpoint? Most people familiar with the situation say Powell would sue if Trump tries dumping him. The case likely would head to the Supreme Court, which ruled recently that the quasi-governmental Fed is a special entity immune from arbitrary personnel moves regarding governors. But that didn’t address the issues surrounding cause.
Beyond a lawsuit, what else could Powell do? If he gets fired as chair of the Board of Governors, the Federal Open Market Committee, which is the Fed body that sets interest rates, simply could retain Powell as chair, giving him continued influence over monetary policy. The FOMC chair historically has been the Fed board chair, but that’s not a requirement.
Does Trump really want to fire Powell, or is he simply setting him up as a scapegoat should the economy go south? The president has shown himself to be a shrewd and often times calculating political player, and having Powell around as a punching bag could be useful as crucial mid-term elections approach.

“What is extraordinary here is the president going back and forth and discussing loudly whether he might fire or try to fire the Fed chair,” said Bill English, the Fed’s former director of monetary affairs and now a Yale professor. “Of course, we’ve never gone through that, so we don’t know legally how that would work and how the courts would see that and so on. So, I think it’s all things that we haven’t seen before, and raises real uncertainties.”

A rapid about-face

Even by Trump’s standards, the event surrounding Powell of late have been stunning.
After an extended campaign of ad hominem attacks on Powell and demands for lower interest rates, Trump met with Republican congressional members Tuesday evening and asked them if he should fire the Fed chair, according to a senior administration official.
After the GOP members showed their backing for the move, the president indicated to them he would move on Powell “soon,” the official said.

However, no sooner did news break of the meeting then Trump told reporters that he’s not considering a move, saying it’s “highly unlikely” while simultaneously wondering out loud whether alleged mismanagement of the $2.5 billion expansion might qualify as cause.
Subsequent reports suggested that Trump’s lawyers indicated that he would have a hard time legally dismissing Powell. The Supreme Court’s ruling in Trump v. Wilcox this year called the Fed a “uniquely structured, quasi-private entity” whose governors enjoy insulation from removal for political or policy reasons.
That, of course, does not mean that Trump won’t try.
“It’s a very high bar legally, but there also haven’t been really any historical precedents for it,” Jonathan Kanter, former assistant attorney general during the Biden administration, said on CNBC. “So it would get litigated in court, probably be quite a bit of a circus, but, yeah, the standard is very high. It has to be for cause, and it has to be for neglect, malfeasance, abuse.”

The legal fallout

Powell’s options would entail suing and asking for a stay on any Trump removal action, Kanter said. The tactic itself that could push resolution past the expiration of the Fed chair’s term in May 2026.
As it winds through the legal system, the case would draw close attention and either could act as a bulwark for Fed independence, or reduce the normally sacrosanct central bank to just another political body subject to the whims of the Oval Office.
“The Supreme Court has signaled it would likely side with the Fed chair,” Kanter said. “It views the Fed as historically different than other independent agencies. Then it would kick the case right back down to a district court, which would determine whether the president had a basis to fire the Fed chair.”
Despite seemingly low chances of success, going after Powell still could serve a political purpose for Trump.
“I think Trump is setting it up so that there’s a sword of Damocles hanging over Powell’s head throughout the rest of his tenure,” Kanter said. “If there is a sustained period of inflation or stagflation, Trump has the ability to say, well, it’s this guy’s fault because he didn’t lower interest rates.”
Indeed, the Trump-Powell dispute by all appearances runs deeper than qualms over the building renovations.

Quest for rate cuts

Trump wants sharply lower interest rates, and he wants them now, economic consequences be damned.
The president was on the attack again Friday, railing against Powell and his fellow central bankers. In a Truth Social post, Trump charged Powell and the FOMC officials are “choking out the housing market with their high rate, making it difficult for people, especially the young, to buy a house. He is truly one of my worst appointments.”
Up until recently, Trump has reserved most of his criticism for Powell individually. But on Friday, he also said, “the Fed Board has done nothing to stop this ‘numbskull’ from hurting so many people. In many ways the Board is equally to blame!” Finally, using his nickname for Powell, he said, “I can’t tell you how dumb Too Late is – So bad for our Country!”
Besides Powell, Trump has two appointees on the board dating back to his first term: governors Michelle Bowman and Christopher Waller, both of whom have said they are leaning toward a rate cut when the FOMC meets at the end of July.
Beyond those two, though, other members have not expressed any appetite for easing before the September meeting. There are 12 voters on the FOMC, and the chair is just one of them. Fed watchers including English, who served as the FOMC secretary, see policymakers pushed into a corner where cutting in July would seem like acquiescing to Trump’s demands.
That’s part of a larger concern on Wall Street over the reputational fallout the Fed faces as the Trump White House ramps up its efforts to use politics to influence monetary policy.

Market, economic fallout

“The experience of other countries in which governments have suppressed central bank independence has generally been a combination of a slippery slope and the occasional sudden drop,” Jonas Goltermann, deputy chief markets economists at Capital Economics, said in a recent note. “Unlike raising tariffs, which can be withdrawn before the real damage is done, the reputational costs from firing Powell would be harder to undo.”
Then there are the market and economic issues.
Firing Powell would be unlikely to change the committee’s approach to monetary policy, and in fact could harden its position on rates.
Even if the FOMC did cut, it could do more harm than good to Trump’s goal of lowering finance costs on the national debt. The last time the Fed cut, in the final four months of 2024, Treasury yields rose almost in perfect reverse correlation to the rate reductions, and the same thing could happen again if markets perceive the Fed is surrendering its inflation-fighting credentials to placate Trump.
“The historical record suggests that political interference contributed to poor monetary policy in the late ’60s and early ’70s, with unfavorable consequences for inflation developments,” JPMorgan Chase chief U.S. economist Michael Feroli wrote. “Any reduction in the independence of the Fed would likely add upside risks to an inflation outlook that is already subject to upward pressures from tariffs and somewhat elevated inflation expectations.”
While Trump wants the Fed to slash its key borrowing rate by 3 percentage points, such a move could raise inflation expectations, causing fixed income investors to demand higher yields, “thereby increasing longer-term interest rates, weighing on the outlook for economic activity, and worsening the fiscal position,” Feroli added.
For the time being, Powell and Co. is expected to continue to conduct business and make decisions based on data, with the constant drumbeat of Trump serving as a distraction that doesn’t seem like it will go away, even if the president ultimately never tries to fire the Fed chief.
“Well, it isn’t helpful to have the president be so aggressively antagonistic trying to pressure the Fed. It’s not unprecedented that a president has views on monetary policy. We’ve seen that over time. But I think what’s different about this time is that it’s been pretty persistent and unrelenting,” former Cleveland Fed President Loretta Mester said Friday on CNBC. “That will not change how the Fed makes it goes about making its decisions on monetary policy.” More

Block is joining the S&P 500, replacing Hess as of July 23.
Hess is exiting the index upon its acquisition by Chevron.
In May, Block reported disappointing quarterly results and issued a weak forecast due to concerns in the “macro environment.”

Jack Dorsey, co-founder and chief executive officer of Twitter Inc. and Square Inc., listens during the Bitcoin 2021 conference in Miami, Florida, on Friday, June 4, 2021.
Eva Marie Uzcategui | Bloomberg | Getty Images

Block shares jumped more than 10% in extended trading on Friday, as the fintech company gets set to join the S&P 500, replacing Hess.
It’s the second change to the benchmark this week, after S&P Global announced on Monday that ad-tech firm The Trade Desk would be added to the S&P 500. Trade Desk is taking the place of software maker Ansys, which was acquired by Synopsys in a deal that closed Thursday.

Hess’ departure comes just after Chevron completed its $54 billion purchase of the oil producer, prevailing against Exxon Mobil in a legal dispute over offshore oil assets in the South American nation of Guyana.
Block will officially join the S&P 500 before the opening of trading on July 23, according to a statement from S&P. Stocks often rally when they’re added to a major index, as fund managers need to rebalance their portfolios to reflect the changes.
Most alterations to the S&P 500 take place during the index’s quarterly rebalancing. However, in the case of the closing of an acquisition, a company can be removed from the index and replaced off schedule. Last week monitoring software company Datadog took Juniper Networks’ place in the S&P 500 as part of the index’s quarterly change. 
Block’s addition brings further tech heft to an index that’s been steadily moving in that direction in recent years, reflecting the market cap gains of companies across the sector. Block, which gained popularity as Square due to the rapid growth of the company’s payment terminals, has expanded into crypto, lending and other financial services.
Founded by Jack Dorsey in 2009, Square changed its name to Block in 2021 to emphasize its focus on blockchain technologies.

Block shares are down 14% this year, underperforming the broader U.S. market. The Nasdaq is up more than 8%, while the S&P 500 has gained 7%. Still, with a market cap of about $45 billion, Block is valued well above the median company in the index.
In May, Block reported first-quarter results that missed Wall Street expectations on Thursday and issued a disappointing outlook, leading to a plunge in the stock price. Block’s forecast for the second quarter and full year reflected challenging economic conditions that followed sweeping tariff announcements by President Donald Trump.
“We recognize we are operating in a more dynamic macro environment, so we have reflected a more cautious stance on the macro outlook into our guidance for the rest of the year,” the company wrote in its quarterly report.
The company is scheduled to report second-quarter results after the close of regular trading on Aug. 7.
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American Express said Friday that travel spending in the quarter was weaker than transactions for goods and services.
Economy class domestic airfare is the source of the weakness, Amex CFO Christophe Le Caillec told CNBC.

American Express has long benefited from a focus on wealthier customers who appreciate the credit card company’s travel and dining perks.
That has helped insulate the company from concerns over a spending slowdown. In the second quarter, total spending on Amex cards jumped 7%, matching the first quarter and higher than the 6% increase a year ago.

But travel spending in the quarter was weaker than transactions for goods and services, and that’s specifically because airline spending has stalled out, coming in flat from a year ago, American Express said Friday.
Economy class domestic airfare is the source of the weakness, Amex CFO Christophe Le Caillec told CNBC. American Express said spending on premium cabins was up 10% from the previous year and that hotel bookings that cost more than $5,000 were up 9%.
But the weak spot could be of concern given the company’s airline partnerships and network of airport lounges, Truist analyst Brian Foran noted.
Airfare prices have also declined, which means consumers are spending less when they buy tickets. Airfare fell 3.5% in June from a year earlier while inflation overall rose, according to the Bureau of Labor Statistics.
Despite beating expectations for second-quarter profit and revenue, and reaffirming its 2025 guidance for those metrics, shares of Amex fell 2.5% in midday trading. Year to date, the company’s shares have climbed less than 4%, trailing most other financials like JPMorgan Chase and Citigroup.

That’s mostly over investor concerns about the spending on rewards programs that Amex has to do as it launches a refreshed Platinum card, Foran said. The company faces increased competition in the premium card space from JPMorgan, Capital One and Citigroup, he said.
“The bear narrative is they have to push harder and harder to get growth, spending more to get more,” Foran said. More

Wall Street is humming thanks to a boom in stock and bond trading and a pickup in corporations acquiring competitors and taking out massive loans.
At the same time, Main Street is holding up as the American consumer continues to spend, borrow and repay loans, according to reports this week from the largest U.S. banks.
It makes for an unusually profitable environment for financial firms. The six biggest U.S. banks generated $39 billion in second-quarter profit, outstripping analysts’ expectations and collectively jumping more than 20% from core earnings a year ago.
It’s a remarkable result after a tumultuous start to the quarter. The period began with shock and plunging markets on April 2 over President Donald Trump’s sweeping “Liberation Day” tariffs.

(L-R) Brian Moynihan, Chairman and CEO of Bank of America; Jamie Dimon, Chairman and CEO of JPMorgan Chase; and Jane Fraser, CEO of Citigroup; testify during a Senate Banking Committee hearing at the Hart Senate Office Building in Washington, D.C., on Dec. 6, 2023.
Saul Loeb | Afp | Getty Images

Nearly everywhere you look in the world of finance, things are going surprisingly well — at least for now.
Wall Street is humming thanks to a boom in stock and bond trading and a pickup in corporations acquiring competitors and taking out massive loans. At the same time, Main Street is holding up as the American consumer continues to spend, borrow and repay loans, according to reports this week from the largest U.S. banks.

It makes for an unusually profitable environment for financial firms. The six biggest U.S. banks generated about $39 billion in second-quarter profit, outstripping analysts’ expectations and collectively jumping more than 20% from core earnings a year ago.
It’s a remarkable result after a tumultuous start to the quarter. The period began with shock and plunging markets on April 2 over President Donald Trump’s sweeping “Liberation Day” tariffs. JPMorgan Chase economists said at the time that the policies would probably cause a recession this year.
But markets roared back after Trump responded to distress signals coming from U.S. bonds and delayed the most punishing tariffs on most trading partners. Investors have begun to tune out the administration’s barrage of tariff pronouncements as bluster or noise, and corporate leaders are stepping off the sidelines to pull off multibillion-dollar transactions, bank results show.
“Look how far the world’s come in three months,” Wells Fargo banking analyst Mike Mayo told CNBC. “Throughout the quarter, you had a pickup in investment banking, loan growth and optimism with economic scenarios. Here we are, with talk of a recession pretty much absent.”
That dynamic was clear at JPMorgan, the largest and most profitable U.S. bank. It produced about $15 billion in quarterly profit, which is nearly as much as the next three largest banks combined.

Trading benefited from turbulent conditions in the quarter as Trump roiled markets with rapidly evolving policy statements. But the real surprise came from investment banking, which involves mergers advice, IPOs and debt and equity issuance. Revenue at JPMorgan jumped 7%, producing $450 million more than analysts had expected, just weeks after managers had warned of an approximate 15% decline.
“The pickup in investment banking fees, to some extent, reflects people accepting uncertainty and deciding to move on with transactions,” JPMorgan CFO Jeremy Barnum told reporters on Tuesday. “The corporate community has sort of accepted that they just need to navigate through this.”

‘Soft landing’

But the good news didn’t end with corporate confidence. JPMorgan’s internal barometers for U.S. economic risks cooled down from the first quarter as some of the worst-case scenarios were taken off the table, Barnum said.
That means it’s less likely that a recession will cause a spike in U.S. unemployment this year, hurting consumers ability to repay their debts. That was clear in the bank’s provision for credit losses, which was 14% smaller than in the first quarter.
The economy is squarely in the “soft landing” scenario, Barnum told reporters this week.
At the same time, consumers and companies are borrowing more money from JPMorgan, where loan growth rose 5% compared with a year ago, fueled by rising credit card and wholesale loans, the bank said.
Those stats mean that, at least for now, banks are giving the all-clear signal on the U.S. economy in the early months of the second Trump presidency. Even in a time marked by turbulence and rising geopolitical risks, the economy has defied expectations for a downturn.
“Banks are economically sensitive businesses, and so how the economy performs under the administration is going to matter to their results,” said Matt Stucky, chief portfolio manager for equities at Northwestern Mutual wealth management. “So far, the economy continues to push forward.”

‘Firing on all cylinders’

The situation even made JPMorgan CEO Jamie Dimon, who frequently warns about risks he sees, sound relatively optimistic about the economy.
“It’s been resilient, and hopefully it’ll continue to be,” Dimon told reporters this week. “It’s always good to hope for the best, prepare for not the best, and we’ll see… One thing I would point out, the world is much bigger and much more diversified” now and that makes for a “slightly more stable global economy than you had 20 years ago,” he said.

Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., July 17, 2025.
Brendan McDermid | Reuters

Trump’s sweeping spending bill, signed into law this month, preserves corporate tax rates and expands business deductions. On top of that, deregulatory efforts across industries will boost the economy, Dimon said.
Last month, the Federal Reserve released a proposal to amend the capital that banks need to hold for lower-risk assets, potentially freeing up billions of dollars for the banks that they could use to boost share repurchases, buy competitors or fuel more loan growth, executives said this week.
Taken together, it’s hard to conceive of a better setup for banks than right now, Barnum said.
“We’re essentially firing on all cylinders,” Barnum told analysts. “Rates are a good level for us. Deal activity is high. Capital markets are very strong. Consumer credit is excellent. Wholesale credit is excellent.”
To be sure, sentiment can shift on a dime, and risks including inflation, the mounting U.S. deficit and geopolitical turmoil are still out there, Barnum noted.

Good times ahead?

Even the banking industry’s former laggards are showing signs of a resurgence.
Wells Fargo CEO Charlie Scharf, fresh off finally removing the yoke of a Federal Reserve punishment that capped his bank’s balance sheet at 2017 levels, sounded ebullient during an earnings call this week. His company recently gave all its employees a $2,000 bonus to celebrate the milestone.  
“This is an incredibly interesting and fun time,” Scharf told analysts Tuesday. “We’re starting to see deposit flows, as we’ve talked about. We’ve got new account growth. We’ve got expenses in check. Credit is performing well… We have less constraints.”

Stock chart icon

Citigroup shares have outpaced most financial stocks this year.

The shares of another former laggard, Citigroup, have climbed nearly 30% this year as CEO Jane Fraser convinces investors her turnaround plan is working.
Fraser this week sounded like a CEO on the attack, disclosing the bank’s new luxury credit card and plans to issue a Citi-branded stablecoin. She also marveled at the resiliency of the U.S. economy.  
“The strength of the U.S. economy, driven by the American entrepreneur and a healthy consumer, has certainly been exceeding expectations,” Fraser told analysts. “As I’ve been speaking to CEOs, I have yet again been impressed by the adaptability of our private sector.” More

So far this year, $2.17 billion has been stolen from crypto services — already eclipsing 2024’s amount, according to a report from Chainalysis.
The total amount of crypto stolen from both platforms and individuals is nearing $3 billion amid a spike in attacks on individual crypto wallets.
It comes as there have been multiple headlines this year about crypto entrepreneurs and their relatives being targeted with physical violence.

Digital currency thefts are on the rise.
Jakub Porzycki | Nurphoto via Getty Images

The value of cryptocurrencies stolen by criminals surged in the first six months of 2025 after a high-profile hack and a wave of physical attacks targeting crypto holders and their relatives.
So far this year, $2.17 billion has been stolen from crypto services — already eclipsing the $1.87 billion of funds stolen from platforms in 2024 — and this is expected to reach $4 billion by the end of 2025, according to a report published Thursday by blockchain analysis firm Chainalysis.

Overall, the combined value of digital tokens stolen from both crypto platforms and individuals hit more than $2.8 billion and is already approaching the $3.4 billion in crypto stolen last year.
The bulk of the funds stolen from services came from February’s cyberattack on Dubai crypto exchange Bybit, which saw North Korea-linked hackers make off with $1.5 billion. It’s estimated to be the largest crypto heist in history.
However, the rise in stolen crypto assets was also driven by a spike in attacks on individual crypto wallets. Personal wallets accounted for over 23% of total thefts, with attackers increasingly turning to physical violence and coercion to access funds, Chainalysis said.

In January, David Balland, a co-founder of crypto wallet firm Ledger, was kidnapped with his wife from their home in central France. Before they were freed, the attackers cut off Balland’s finger and sent footage of it to his fellow co-founder Eric Larcheveque demanding ransom money.
Separately, in May, the father of a crypto entrepreneur was taken in broad daylight by four men wearing ski masks. The kidnappers demanded a ransom of several million euros and cut off one of the man’s fingers. He was freed by police days later.

Eric Jardine, cybercrimes research lead at Chainalysis, told CNBC that the rise in crypto-related thefts was primarily being driven by increasing crypto adoption and price appreciation.
“Adoption means there are more services and users in the crypto ecosystem, making thefts more common. Price appreciation means that services and individuals in crypto have more USD value to lose, even if the total assets stolen are relatively constant over time,” Jardine said via email.

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Jardine suggested that the uptick in attacks on individual crypto holders could relate to the fact that crypto trading services are beefing up their security.
“If services become better at security, malicious actors will potentially move to targeting individual wallet holders and trade off a single large-scale heist in favor of a large number of smaller-scale victimizations,” he said.
Meanwhile, rising wealth accumulated through holdings of cryptocurrencies like bitcoin has resulted in a rise in crypto influencers flaunting their lifestyle on social media platforms.
Jardine stressed it was important not to blame the victims of physical crypto-related attacks, adding that “showy displays of wealth can quite obviously attract the attention of a bad actor when compared to a more modest outward facing lifestyle.” More

Talk to executives and before long they will rhapsodise about all the wonderful ways in which their business is using artificial intelligence. Jamie Dimon of JPMorgan Chase recently said that his bank has 450 use cases for the technology. “AI will become the new operating system of restaurants,” according to Yum! Brands, which runs KFC and Taco Bell. AI will “play an important role in improving the traveller experience”, says the owner of Booking.com. In the first quarter of this year executives from 44% of S&P 500 companies discussed AI on earnings calls. More

When Donald Trump’s tariffs are mentioned, you might recall his “Liberation Day” duties on uninhabited islands, his on-again, off-again threats against Canada, or the curt letters he has sent foreign leaders informing them of imminent rates. These country-level tariffs dominate attention. So it is easy to forget that the steepest tariffs Mr Trump has thus far implemented are on products, not countries. And by all indications more of these “sectoral” tariffs are coming soon. More