Trump Denies He’s Planning to Fire Powell

Summary

WSJ What’s News: Trump Denies He’s Planning to Fire Powell
Release Date: July 16, 2025
Host: Alex Osola, The Wall Street Journal

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1. President Trump Denies Plans to Fire Federal Reserve Chair Jerome Powell

In the opening segment, Alex Osola reports on President Donald Trump's denial of intentions to dismiss Federal Reserve Chair Jerome Powell. Addressing reporters at the White House, Trump asserted that he is not currently planning to remove Powell but hinted at the possibility of doing so "for cause" in the future. He criticized the Federal Reserve for allocating excessive funds toward renovating two historic office buildings.

Alex Osola [02:03]: "President Trump has for years raised the prospect of firing Powell. So far he hasn't done so. But the president has grown increasingly frustrated with Powell."

An unnamed political analyst provided insights, suggesting that while Trump has neither confirmed nor ruled out the firing, it remains unlikely unless fraud is involved in the renovation expenses. The analyst speculated potential misuse of funds in the $2.7 billion renovation project but emphasized that Powell's removal would require substantial evidence of wrongdoing.

Unnamed Political Analyst [01:23]: "I don't rule out anything, but I think it's highly unlikely unless he has to leave for fraud."

Trump also revealed that during a closed-door meeting with GOP lawmakers, several expressed support for the idea of firing Powell, although Trump characterized his stance as more conservative.

Alex Osola [02:12]: "Trump also said that during a meeting yesterday at the White House, he asked GOP lawmakers how they felt about firing the Fed chair, and several expressed support for the idea."

The potential removal of Powell has stirred market reactions, with U.S. stocks rising following the denial. However, bank stocks experienced declines amid fears that a change in Fed leadership could lead to market instability and heightened inflation risks.

2. Big Banks Report Strong Second Quarter Earnings Amid Uncertainty

The discussion shifts to the robust second-quarter earnings reported by major banks, including Goldman Sachs, JPMorgan Chase, Bank of America, Citigroup, and Morgan Stanley. Goldman Sachs, in particular, saw its profit surge by 22%, significantly surpassing analyst expectations, while revenues increased by 15%.

Anna Maria Andreotis, a senior WSJ reporter covering large banks, delves into the factors driving these impressive profits. She attributes the growth to heightened market volatility and uncertainty, particularly stemming from President Trump's tariff policies. This environment led investors to reposition their portfolios, boosting trading revenues for these institutions.

Anna Maria Andreotis [03:42]: "What's driving the profits is all the uncertainty and market volatility that has been around President Trump's tariffs."

On the investment banking front, initial tariff announcements had temporarily stalled deal-making activities, especially in the IPO market. However, as the quarter progressed, renewed confidence among company CEOs reignited deal-making efforts, contributing to the banks' strong performance.

Looking ahead, Andreotis remains cautiously optimistic. While there is enthusiasm about upcoming deals, persistent uncertainties regarding trade agreements, the impact of tariffs on economic growth, and geopolitical risks—particularly in the Middle East—pose challenges to sustained growth in investment banking.

Anna Maria Andreotis [05:13]: "Number one, there's a number of trade deals that still have to be worked out. There's also the unknowns of the impact that tariffs will have on growth, on economic growth."

In summary, the second quarter was favorable for large banks, yet the prevailing uncertainty continues to cast a shadow over future growth prospects in the investment banking sector.

3. Oracle's Stock Soars Amid AI Expansion

Shifting focus to the technology sector, Alex Osola highlights Oracle's unexpected surge in stock value, positioning it as a significant player in the artificial intelligence (AI) landscape. Despite being a 48-year-old software giant, Oracle has successfully leveraged its established cloud computing infrastructure to handle burgeoning AI workloads.

Dan Gallagher, WSJ's "Heard on the Street" columnist, provides deeper insights into Oracle's strategy and future prospects. He notes that while AI currently represents a small portion of Oracle's reported revenue, the company's foundational strengths in database software and cloud computing position it well to capitalize on AI-driven growth.

Dan Gallagher [07:41]: "It's become an AI story. And what's interesting is AI is still a relatively small part of their actual reported revenue."

Gallagher also points to a significant White House-backed data center project intended to support AI initiatives for OpenAI, indicating potential future revenue streams for Oracle. Furthermore, Oracle's recent filing revealed a $30 billion revenue-driving deal set to commence in its 2028 fiscal year, underscoring the company's ambitious growth plans.

Dan Gallagher [08:29]: "They have a lot of potential. A few weeks ago they put in a filing that they just got a deal that's going to drive around 30 billion in revenue starting in their 2028 fiscal year."

Despite the optimistic outlook, Gallagher cautions that Oracle faces intense competition from tech giants like Nvidia and must navigate the inherent risks associated with the AI sector's rapid evolution. Success hinges on Oracle’s ability to effectively implement its AI strategies and secure the necessary technological partnerships.

4. Ford Recalls 700,000 Vehicles; EU Exports to U.S. Decline Slightly

In the final segment, Alex Osola reports on Ford Motor Company's significant recall of nearly 700,000 vehicles due to defective fuel injectors that may crack and leak fuel, posing a fire risk. The affected models include certain Bronco, Sport, and Escape variants. Ford anticipates incurring approximately $570 million in costs related to the recall, as detailed in its second-quarter results. Dealers are advised to implement an interim repair by updating the engine control software at no cost to consumers.

Parallel to the recall news, Osola discusses the slight decline in European Union exports to the United States, which fell to around $54 billion in May. This marks the second consecutive month of reduced exports following a record high in March, attributed to American importers stockpiling goods in anticipation of Trump administration tariffs. Despite the recent dip, EU exports remain robust compared to the previous year, highlighting resilience amid ongoing tariff-related challenges.

Alex Osola [09:33]: "It's the second consecutive month that the EU's exports have fallen after they reached a record high in March when American importers stockpiled goods ahead of the Trump administration's impending tariff announcements."

The report concludes by emphasizing that while European exports to the U.S. have shown resilience, the enduring presence of tariffs continues to test transatlantic trade dynamics.

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Conclusion

This episode of WSJ What’s News covered critical developments in U.S. politics, banking, technology, and international trade. From President Trump's fluctuating stance on Federal Reserve leadership and the robust yet uncertain earnings of major banks, to Oracle's strategic pivot into AI and significant recalls by Ford, the episode provided comprehensive insights into factors shaping the current economic and business landscape.

Transcript

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[Alex Osola]

President Trump denies that he's trying to fire Federal Reserve Chair Jerome Powell. Plus, as banks like Goldman Sachs report bumper quarterly earnings, the does past performance guarantee future results?

[Anna Maria Andreotis]

The second quarter was a quite good quarter for the large banks, but a lot of uncertainty remained. And in the world of investment banking, uncertainty is not something that tends to help growth and deal making and how.

[Alex Osola]

A nearly 50 year old software giant may become one of the biggest players in artificial INTELLIGENCE It's Wednesday, July 16th. I'm Alex Osola for the Wall Street Journal. This is the PM edition of what's news, the top headlines and business stories that move the world today. President Trump has denied that he was planning an attempt to fire Federal Reserve Chair Jerome Powell after polling Republican lawmakers during a closed door meeting about whether he should oust him. Answering reporters questions at the White House, the president suggested he could attempt to remove Powell for cause, arguing the central bank spent too much money on renovations of two historic office buildings.

[Unnamed Political Analyst]

I don't rule out anything, but I think it's highly unlikely unless he has to leave for fraud. I mean, it's possible there's fraud involved with the 2.5, $2.7 billion renovation. This is a renovation. How do you spend $2.7 billion and he didn't have proper clearance, et cetera, et cetera. So you know that's going on. So you know there could be something to that. But I think he's not doing a good job. He's got a very easy job to do. You know what he has to do? Lower interest rates.

[Alex Osola]

Trump also said that during a meeting yesterday at the White House, he asked GOP lawmakers how they felt about firing the Fed chair, and several expressed support for the idea.

[Unnamed Political Analyst]

I talked about the concept of fire him. I said, what do you think? Almost every one of them said I should, but I'm more conservative than they are.

[Alex Osola]

According to a senior administration official, the president then suggested he could move to fire Powell in the near future. Trump has for years raised the prospect of firing Powell. So far he hasn't done so. But the president has grown increasingly frustrated with Powell. In recent months and has hammered the Fed chair for what he has characterized as dragging his feet on interest rate cuts. Trump also told reporters today that he was considering choosing Kevin Hassett, one of his closest economic advisers, to succeed Powell as Fed chair. U.S. stocks rose today after President Trump denied he would try to fire Federal Reserve Chair Jerome Powell. The dow finished about 0.5% higher. The S&P 500 added roughly 0.3% and the Nasdaq was up about a quarter of a percent. Bank stocks remained a weak point, with Morgan stanley dropping about 1.3% and several other large US lenders in the red on the day. Wall street fears that Powell's replacement could set off an unruly period in markets and increase the risk of inflation rebounding. Goldman Sachs has reported bumper earnings for the second quarter. Its profit jumped 22%, beating analyst expectations, and its revenue rose 15%. It's the latest big bank to report surging profits. JPMorgan Chase, bank of America, Citigroup and Morgan Stanley also reported higher trading revenue. WSJ reporter Anna Maria Andreotis covers big banks for the Journal. Anna Maria what is driving these profits?

[Anna Maria Andreotis]

What's driving the profits is all the uncertainty and market volatility that has been around President Trump's tariffs. There's two layers here in terms of what's going on. Number one on the trading side for these banks like Goldman, pretty much all of the major big banks, Goldman, JP Morgan, Morgan Stanley and so on, saw increased revenues in trading. And that's a reflection of the fact that in Q2 in the second quarter, there was basically a lot of repositioning that investors were doing with their portfolios because of the uncertainty. Meanwhile, this quarter also driving profits for several big banks, including Goldman, is on the investment banking side. This was kind of a whipsaw type of quarter on the deal making front. What I mean by that is at the very beginning of the quarter, because of the initial tariff announcement on Liberation Day, a number of deals that were being worked on were essentially put on hold, in particular in the IPO market. So what played out as the second quarter went on was improved confidence from company CEOs, more of a willingness and an appetite by companies to get back to deal making. It's almost the two sides of the chaos surrounding tariffs because obviously the tariffs and trade policy. There's a lot that has not been finalized on that.

[Alex Osola]

Anna Maria Looking ahead, what does the next quarter look like for some of these big banks?

[Anna Maria Andreotis]

So several big banks talked about there being a lot of deal making in the works on the investment banking front. So there's definitely optimism that's been shared by a number of banks. However, at the same time, there are several things that are, quite frankly, pretty uncertain. Number one, there's a number of trade deals that still have to be worked out. There's also the unknowns of the impact that tariffs will have on growth, on economic growth. And then there's also the ongoing geopolitical risks, in particular in the Middle East. So a way to summarize what's going on right now is that the second quarter was a quite good quarter for the large banks, but a lot of uncertainty remains. And in the world of investment banking, uncertainty is not something that tends to help growth in dealmaking.

[Alex Osola]

That was WSJ reporter Anamaria Andreotis. Thanks, Anna Maria.

[Anna Maria Andreotis]

Thank you.

[Alex Osola]

The Labor Department said today that the producer Price Index held steady in June, missing forecasts for a slight rise. Economists watch the PPI closely because some of its data are used to calculate the Federal Reserve's preferred inflation metric, the Personal Consumption Expenditures Price Index. Coming up, why Oracle Stock Is booming That's after the break.

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[Alex Osola]

The artificial intelligence boom has turned lesser known companies like TSMC and Nvidia into household names. One unlikely success story is 48 year old Oracle. The company had already built up a cloud business to compete with those offered by industry titans like Amazon, Microsoft and Google. Now its stock price is surging. WSJ Heard on the street columnist Dan Gallagher joins me now with more. Dan Oracle's market cap is around $650 billion. What is driving its business now?

[Dan Gallagher]

It's become an AI story. And what's interesting is AI is still a relatively small part of their actual reported revenue. Oracle started with database software product that like every major company uses in some fashion and they parlayed that into a position in cloud computing. So that has put them in this great position for essentially handling AI workloads. Earlier this year there was a big deal announced in the White House that was to build this massive data center project to power AI that was going to essentially be for OpenAI. So that money hasn't even yet or just barely actually started flowing in, but it's really big.

[Alex Osola]

You note in your column that Oracle is the biggest tech company that's not yet in the trillion dollar club. What does business look like moving forward?

[Dan Gallagher]

They have a lot of potential. A few weeks ago they put in a filing that they just got a deal that's going to drive around 30 billion in revenue starting in their 2028 fiscal year. If you think about it, that's one single contract that's going to really potentially almost double in size in terms of annual revenue.

[Alex Osola]

So does it have the potential then to really be one of the biggest names in AI in the coming years?

[Dan Gallagher]

It's certainly possible. They have to make a lot of things go right and they have to compete against these other companies that are even bigger to get the chips from Nvidia and other things to build up this capability. And they obviously, like the others, need AI to really pan out into a huge, huge business. Oracle is kind of facing that risk that maybe that doesn't pan out the way optimists think it well, or as fast as it will. But that's not really different from what pretty much all the companies in the trillion dollar tech club are exposed to that risk right now.

[Alex Osola]

That was WSJ heard on the street columnist Dan Gallagher. Thank you, Dan.

[Dan Gallagher]

Thank you for having.

[Alex Osola]

Ford Motor is recalling nearly 700,000 vehicles adding to the automaker's record breaking recall tally this year, according to the National Highway Traffic Safety Administration. Fuel injectors in certain vehicles, including some Bronco, Sport and Escape models, may crack and leak fuel inside the engine compartment, increasing the risk of a fire, the regulator said. A fix is currently under development as an interim repair dealers will update the engine control software free of charge. Ford estimated it will incur about $570 million in costs associated with the recall in its second quarter results. And Europe's exports to the US edged down to around $54 billion in May. That's according to the European Union statistics agency Eurostat. It's the second consecutive month that the EU's exports have fallen after they reached a record high in March when American importers stockpiled goods ahead of the Trump administration's impending tariff announcements. But May's numbers were still higher than a year earlier, a sign of resilience that will be tested as higher tariffs look set to become a settled feature of transatlantic trade. And that's what's news for this Wednesday afternoon. Today's show is produced by Anthony Banci and Pierre Biennime, with supervising producer, Michael Kosmides. I'm Alex Osoloff for the Wall Street Journal. We'll be back with a new show tomorrow morning.

[Anna Maria Andreotis]

Thanks for listening.