FHFA demands investigation into Powell's bias against Trump

Original Title: FHFA Requests Investigation of Jerome Powell for Bias Against Trump

Original author: Sham

Source of the original text:

Compiled by: Daisy, Mars Finance

William Pulte, the Director of the Federal Housing Finance Agency (FHFA), has called on Congress to investigate Federal Reserve Chairman Jerome Powell for allegedly misleading behavior in testimony related to a $2.5 billion headquarters renovation project.

Despite Powell's denial of a luxury upgrade, Federal Reserve documents confirm that the renovation plan includes a private dining room, marble decor, and a rooftop garden, which contradicts his statements during testimony in the Senate.

At the time of this scandal, the Federal Reserve is facing huge financial losses, drawing criticism from Trump and industry figures like Elon Musk.

The situation in Washington is heating up – and not just because of the temperature. The head of the Federal Housing Finance Agency, William Pulte, who is also in charge of Fannie Mae and Freddie Mac, is directing his ire at Federal Reserve Chair Jerome Powell. His complaint? Powell's "misleading testimony" regarding a staggering $2.5 billion headquarters renovation project. Critics have dubbed the project the "Versailles Plan."

In a leaked statement obtained by the New York Post, Pruitt does not hide his stance. He hopes Congress will investigate, accusing Powell of "having political bias" and "blatantly lying" to lawmakers during recent testimony. "This smells very bad," he wrote, "Powell's statements are not just misleading—they constitute grounds for impeachment." Pruitt is firing on all cylinders.

Testimony questioned

The focal point of the controversy lies in Powell's denial last week during his testimony before the Senate Banking Committee that the Federal Reserve's headquarters renovation project includes luxury facilities such as a VIP restaurant, private elevators, or a luxurious rooftop garden.

"No marble, no new water features, no private elevators," Powell said decisively.

However... the facts do not seem to be the case. The documents submitted by the Federal Reserve to the National Capital Planning Commission (which are still publicly accessible) clearly list, among other things, the restoration of private dining rooms, elevators for the exclusive use of board members, and vegetated terraces designed to attract "urban wildlife." These are in stark contrast to Powell's testimony.

Trump, Pult and the "MAGA" microphone

President Trump has always been unreserved in his criticism of Powell, and earlier this week he struck again by personally writing to the Federal Reserve Chairman requesting a rate cut. Now, Pruitt has also joined the chorus and is reportedly considering whether Trump could "for cause" dismiss Powell, as the pressure continues to mount.

A critic said: 'This is not just an over-budget construction project; it's a matter of accountability. Taxpayers are footing the bill, while Powell seems indifferent.'

Don't forget—that the budget for this renovation has already increased by 30% from the original estimate, expanding from $1.9 billion to $2.5 billion.

Where did the money go?

According to documents from the Federal Reserve itself, this renovation includes marble decor, high-end restaurant suites, rooftop gardens, and more. Notably, the new skyscraper by JPMorgan in New York is expected to cost only $3 billion – and that is a 60-story entire building located in Manhattan. So, it is only natural to ask how the relatively small headquarters of the Federal Reserve in Washington could cost nearly the same.

Even Elon Musk has voiced that this situation is "concerning" and has suggested that regulatory agencies conduct a thorough investigation.

Fiscal deficit and rising criticism

The timing of this scandal's outbreak is very unfortunate. The Federal Reserve is currently under scrutiny due to record financial losses—losing $114.6 billion just in 2023, primarily because interest expenses exceeded bond returns. Overall, the Federal Reserve's deferred assets and liabilities have reached $233 billion. Until this shortfall is cleared, the Federal Reserve will not be able to remit profits to the U.S. Treasury. This means that funding support for areas such as education, defense, and healthcare will be reduced.

So, yes, although the Federal Reserve insists that these losses will not affect its operations, burning through billions for a palace-style renovation in this context has indeed dealt a significant blow to its credibility.