Powell Probe Stirs GOP Concern, Minnesota Sues Over Ice Surge, More

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Karen Moskow 0:00
Bloomberg Daybreak is your best way to get informed first thing in the morning, right in your podcast feed. Hi, I'm Karen Moskow.
Nathan Hager 0:08
And I'm Nathan Hager. Each morning, we're up early putting together the latest episode of Bloomberg Daybreak U.S. Edition. It's your daily 15-minute podcast on the latest in global news, politics, and international relations.
Karen Moskow 0:21
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Caroline Hepke 0:28
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Amy Morris 0:33
News when you want it with Bloomberg News Now. I'm Amy Morris. President Trump faced rare opposition from key Republican lawmakers after Fed Chair Jay Powell accused the Department of Justice of launching a grand jury investigation to pressure and intimidate the central bank. Republican Senators Lisa Murkowski and Kevin Cramer expressed opposition to the investigation, Murkowski calling it an attempt at coercion. Bloomberg's Tyler Kendall.
Tyler Kendall 0:57
It does appear that Powell is talking with the senators in real time. Senator Lisa Murkowski, a Republican from Alaska, confirmed she spoke with him earlier this morning. And she's now suggesting that Congress could launch its own investigation into the Department of Justice's investigation.
Amy Morris 1:13
Senate Majority Leader John Thune said the threat of a legal battle with the Fed could make confirming Fed nominees challenging. And he warned the allegations against Powell, quote, better be real and they better be serious. Republican Representative French Hill of Arkansas released a statement calling the charges against Powell a distraction. Three former heads of the Federal Reserve and four former Treasury secretaries decried the investigation, saying it would undermine the U.S. central bank's independence. That statement was signed by former Fed chairs Janet Yellen, Ben Bernanke, and Alan Greenspan, and former Treasury Secretaries Tim Geithner, Jacob Lew, Henry Paulson, and Robert Rubin. And Treasury Secretary Scott Besant reportedly told President Trump late yesterday...
Amy Morris 1:57
that the probe into Fed Chair Powell made a mess and would be bad for financial markets. Axios reports U.S. Attorney Jeanine Pirro's office launched the probe without warning, with no heads up for Treasury, the White House or the main Justice Department. The ranking Democrat on the Senate Banking Committee, Senator Elizabeth Warren, says every president would like low interest rates in election years. But Trump's war on the Federal Reserve is doing worldwide damage.
Karen Moskow 2:23
The Fed has been the gold standard. for monetary policy decision making. And Donald Trump is burning that to the ground. And that's going to be costly for the United States over a very long arc if Trump gets away with this.
Amy Morris 2:39
Senator Elizabeth Warren speaking at the National Press Club. Warren also says she supports Trump's move to cap credit card interest rates at 10 percent for a year.
Karen Moskow 2:48
He said that during the election.

What recent actions have raised concerns among GOP lawmakers regarding Fed Chair Powell?

Karen Moskow 2:49
And I said, let's go. I'm ready. And where's President Trump been? Missing in action. All of a sudden, Trump is starting to wake up to the fact that people across this country are more alarmed about their economic circumstances than they were a year ago.
Amy Morris 3:05
Senator Warren is a guest tonight on Balance of Power. The state of Minnesota and the twin cities of Minneapolis and St. Paul are suing the federal government to stop an enforcement surge by Immigration and Customs Enforcement. Minnesota Attorney General Keith Ellison.
Keith Ellison 3:20
The deployment of thousands of armed mass DHS agents to Minnesota has done our state serious harm. This is, in essence, a federal invasion of the Twin Cities and Minnesota, and it must stop.
Amy Morris 3:34
The lawsuit alleges Operation Metro Surge violates federal law because it's arbitrary and capricious, and that the federal government is really targeting Minnesota over politics.

How are Republican senators reacting to the investigation into the Federal Reserve?

Amy Morris 3:44
This comes after the shooting death of a Minneapolis woman by an ICE officer. Stocks, bonds and the dollar bounced from session lows, but caution prevailed after the Trump administration escalated its attack on the Federal Reserve.

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