A recent post by Congresswoman Anna Paulina Luna on social media has led to a surge in speculation about the potential removal of Federal Reserve Chair Jerome Powell. Luna stated that Powell's firing is 'imminent', although she provided no further details. This statement caused a 4% increase in the 'yes' side of a related Polymarket contract, reaching 27%.
However, it's worth noting that Luna is not a member of the House Financial Services Committee, which oversees the Federal Reserve. Historically, President Trump has expressed a desire to remove Powell, but such a move would face substantial legal challenges. According to a 2019 analysis by the Brookings Institution, the Federal Reserve Act's 'for cause' removal protections, as supported by the 1935 Supreme Court case Humphreys' Executor v. United States, only allow for the removal of Fed governors in cases of inefficiency, neglect of duty, or malfeasance in office.
As a result, Polymarket bettors have somewhat cooled off, with the odds on Powell's removal dropping back to 25% following the initial surge. Meanwhile, Bitcoin traders have shown little concern over the possibility of Powell's removal, with the cryptocurrency's price remaining stable.