Republican senators caution Trump against firing Fed chair Jerome Powell
The measure of support from GOP members of the Senate Committee on Banking, Housing, and Urban Affairs showed how traditional Republicans are carefully navigating a presidency in which Trump often flirts with ideas — like steep tariffs or firing the Fed chair — that threaten to undermine confidence in the U.S. economy.
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Tillis, who recently decided not to seek reelection after clashing with Trump, later told The Associated Press that the economic fallout from Powell's firing would mostly hurt 'little guys like me that grew up in trailer parks that may have a few thousand dollars in a 401k.'
He also pointed out that the underlying complaint that Trump has with the Fed — its reluctance to cut interest rates — is not controlled by Powell alone, but instead a 12-member committee.
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'The markets expect an independent, central bank,' said GOP South Dakota Sen. Mike Rounds, who cautioned against firing Powell. 'And if they thought for a minute that he wasn't independent, it would cast a spell over the forecasts and the integrity of the decisions being made by the bank.'
Still, plenty of other Republicans think that dismissing Powell is a fine idea.
'The most incompetent, worst Federal Reserve chairman in American history should resign,' said GOP Ohio Sen. Bernie Moreno.
Trump said he was also encouraged to fire Powell during a meeting with about a dozen far-right House members Tuesday evening.
Do presidents have authority to fire the Fed chair?
House Speaker Mike Johnson, R-La., told reporters that he was 'unhappy with the leadership' at the Fed, but added 'I'm honestly not sure whether that executive authority exists' to fire Powell.
House Financial Services Committee chair French Hill has underscored that presidents don't have the authority to fire the Fed chair, yet has also been sympathetic to Trump's complaints about Powell's leadership. He and other Republicans have also noted that Powell's term as chair is ending next year anyway, and Trump will have an opportunity to name a new chair then.
When Congress started the Federal Reserve over 100 years ago, it insulated it from political pressure by stipulating that its governors and chair could only be fired 'for cause' — a higher bar than most political appointees. However, the Trump administration has maneuvered to meet that standard by accusing Powell of mishandling a $2.5 billion renovation project at the Fed's headquarters.
'When his initial attempts to bully Powell failed, Trump and Republicans in Congress suddenly decided to look into how much the Fed is spending on building renovations,' Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, said in a speech Wednesday. 'Independence does not mean impunity and I have long pushed for more transparency and accountability at the Fed. But give me a break.'
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After Powell sent Congress a letter detailing parts of the renovation project, Sen. Tim Scott, the Senate Banking Committee chair, released a short statement saying Scott 'has continued to call for increased transparency and accountability at the Federal Reserve, and this letter is consistent with improving the communication and transparency he is seeking.'
Avoiding a protracted legal battle
Regardless, it would be legally dubious to fire Powell over the renovation.
'That would be litigated and I don't see a reason, for cause or otherwise, to remove him,' Sen. John Kennedy, a Republican member of the Senate committee that oversees the Fed, told reporters this week.
He added that he understood the president's 'frustration' with the Fed's reluctance to lower interest rates as it tries to tamp down inflation, saying, 'I get that, but I think it's very important the Federal Reserve remains independent.'
Even those Republicans who argued that the president has grounds to fire Powell and piled criticism on the central banker conceded that it would still be a painful step.
'That's a decision the president will make, and he's being very deliberate about it,' said Moreno, the Ohio senator who called for Powell's resignation. 'But I don't think we should put the country through any of that.'
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Royal Caribbean (RCL) stock rose 4% before the bell after raising its annual profit forecast on Tuesday, banking on resilient demand for the cruise operator's high-end private island destinations and premium sailings. The market is finally getting what it wants Wall Street's busiest week of the summer is turning out to be an inflection point. Yahoo Finance's Hamza Shaban explains why in today's Morning Brief: Read more here. Wall Street's busiest week of the summer is turning out to be an inflection point. Yahoo Finance's Hamza Shaban explains why in today's Morning Brief: Read more here. Spotify stock sinks after Q2 earnings miss Spotify (SPOT) shares fell as much as 10% in early premarket trading Tuesday after the company missed second quarter earnings and revenue expectations. The results follow a remarkable 120% rally over the past year, as the stock rebounded from 2022 lows on the back of price hikes, cost cuts, and investor enthusiasm for AI and advertising. Spotify hit a record high of $738.45 earlier this month, but shares slid to around $635 immediately following the results. Spotify reported second quarter revenue of €4.19 billion ($4.86 billion), missing analyst expectations of €4.27 billion, though up from €3.81 billion in the same period last year. The company posted an adjusted loss of €0.42 ($0.49) per share, sharply missing forecasts for a profit of €1.97 and down from earnings of €1.33 in Q2 2024. "Outsized currency movements during the quarter impacted reported revenue by €104 million vs. guidance," the company said in the earnings release. Operating income also fell short of expectations in the quarter, though subscriber metrics for both premium and ad-supported tiers came in ahead of estimates. Gross margins of 31.5% came in as expected. Spotify's massive rally heading into the earnings report was fueled by a sweeping business overhaul, including layoffs, leadership changes, and a pullback from costly podcast exclusivity. After spending $1 billion to build out its podcast business, the company has since scaled back and narrowed its focus. Still, it remains committed to the medium, paying over $100 million to creators in Q1 alone, including high-profile names like Joe Rogan and Alex Cooper. Read more here. Spotify (SPOT) shares fell as much as 10% in early premarket trading Tuesday after the company missed second quarter earnings and revenue expectations. The results follow a remarkable 120% rally over the past year, as the stock rebounded from 2022 lows on the back of price hikes, cost cuts, and investor enthusiasm for AI and advertising. Spotify hit a record high of $738.45 earlier this month, but shares slid to around $635 immediately following the results. Spotify reported second quarter revenue of €4.19 billion ($4.86 billion), missing analyst expectations of €4.27 billion, though up from €3.81 billion in the same period last year. The company posted an adjusted loss of €0.42 ($0.49) per share, sharply missing forecasts for a profit of €1.97 and down from earnings of €1.33 in Q2 2024. "Outsized currency movements during the quarter impacted reported revenue by €104 million vs. guidance," the company said in the earnings release. Operating income also fell short of expectations in the quarter, though subscriber metrics for both premium and ad-supported tiers came in ahead of estimates. Gross margins of 31.5% came in as expected. Spotify's massive rally heading into the earnings report was fueled by a sweeping business overhaul, including layoffs, leadership changes, and a pullback from costly podcast exclusivity. After spending $1 billion to build out its podcast business, the company has since scaled back and narrowed its focus. Still, it remains committed to the medium, paying over $100 million to creators in Q1 alone, including high-profile names like Joe Rogan and Alex Cooper. Read more here. UnitedHealth stock slips after mixed Q2 results Shares of UnitedHealth Group (UNH) fell nearly 3% after its quarterly results before the bell painted a mixed picture. Yahoo Finance's Anjalee Khemlani reports: Read more here. Shares of UnitedHealth Group (UNH) fell nearly 3% after its quarterly results before the bell painted a mixed picture. Yahoo Finance's Anjalee Khemlani reports: Read more here. Sarepta stock rockets higher after FDA greenlight Shares in drugmaker Sarepta (SRPT) rocketed up over 30% in premarket after the embattled company got the FDA's go-ahead to resume shipments of its Elevdis gene therapy. The greenlight comes after Sarepta put a voluntary pause on shipments for some patients while the US regulator reviewed its safety following deaths. The FDA on Monday recommended that the compa lift that halt. Sarepta's stock is poised to build on a 16% gain on Monday, continuing a recent volatile spell triggered by changing fortunes for its best-selling product. AP reports: Read more here. Shares in drugmaker Sarepta (SRPT) rocketed up over 30% in premarket after the embattled company got the FDA's go-ahead to resume shipments of its Elevdis gene therapy. The greenlight comes after Sarepta put a voluntary pause on shipments for some patients while the US regulator reviewed its safety following deaths. The FDA on Monday recommended that the compa lift that halt. Sarepta's stock is poised to build on a 16% gain on Monday, continuing a recent volatile spell triggered by changing fortunes for its best-selling product. AP reports: Read more here. Nvidia orders 300,000 H20 chips from TSMC to satiate Chinese demand Reuters reports: Nvidia placed orders for 300,000 H20 chipsets with contract manufacturer TSMC last week, two sources said, with one of them adding that strong Chinese demand had led the U.S. firm to change its mind about just relying on its existing stockpile. Read more here. Reuters reports: Nvidia placed orders for 300,000 H20 chipsets with contract manufacturer TSMC last week, two sources said, with one of them adding that strong Chinese demand had led the U.S. firm to change its mind about just relying on its existing stockpile. Read more here. Oil maintains gains with tariffs and OPEC+ supply in sight Oil maintained gains following Trump putting pressure on Russia over the war in Ukraine with economic sanctions against Putin's government on the table. Bloomberg reports: Read more here. Oil maintained gains following Trump putting pressure on Russia over the war in Ukraine with economic sanctions against Putin's government on the table. Bloomberg reports: Read more here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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Is Salesforce (NYSE:CRM) Using Too Much Debt?
Legendary fund manager Li Lu (who Charlie Munger backed) once said, 'The biggest investment risk is not the volatility of prices, but whether you will suffer a permanent loss of capital.' It's only natural to consider a company's balance sheet when you examine how risky it is, since debt is often involved when a business collapses. Importantly, Salesforce, Inc. (NYSE:CRM) does carry debt. But the more important question is: how much risk is that debt creating? Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. When Is Debt A Problem? Debt and other liabilities become risky for a business when it cannot easily fulfill those obligations, either with free cash flow or by raising capital at an attractive price. In the worst case scenario, a company can go bankrupt if it cannot pay its creditors. However, a more usual (but still expensive) situation is where a company must dilute shareholders at a cheap share price simply to get debt under control. Of course, plenty of companies use debt to fund growth, without any negative consequences. The first thing to do when considering how much debt a business uses is to look at its cash and debt together. How Much Debt Does Salesforce Carry? You can click the graphic below for the historical numbers, but it shows that Salesforce had US$8.44b of debt in April 2025, down from US$9.43b, one year before. However, its balance sheet shows it holds US$17.4b in cash, so it actually has US$8.97b net cash. How Healthy Is Salesforce's Balance Sheet? We can see from the most recent balance sheet that Salesforce had liabilities of US$24.2b falling due within a year, and liabilities of US$13.7b due beyond that. Offsetting this, it had US$17.4b in cash and US$4.35b in receivables that were due within 12 months. So it has liabilities totalling US$16.2b more than its cash and near-term receivables, combined. Shop Top Mortgage Rates Personalized rates in minutes A quicker path to financial freedom Your Path to Homeownership Given Salesforce has a humongous market capitalization of US$257.3b, it's hard to believe these liabilities pose much threat. Having said that, it's clear that we should continue to monitor its balance sheet, lest it change for the worse. Despite its noteworthy liabilities, Salesforce boasts net cash, so it's fair to say it does not have a heavy debt load! See our latest analysis for Salesforce Also positive, Salesforce grew its EBIT by 20% in the last year, and that should make it easier to pay down debt, going forward. There's no doubt that we learn most about debt from the balance sheet. But it is future earnings, more than anything, that will determine Salesforce's ability to maintain a healthy balance sheet going forward. So if you want to see what the professionals think, you might find this free report on analyst profit forecasts to be interesting. Finally, a company can only pay off debt with cold hard cash, not accounting profits. Salesforce may have net cash on the balance sheet, but it is still interesting to look at how well the business converts its earnings before interest and tax (EBIT) to free cash flow, because that will influence both its need for, and its capacity to manage debt. Over the last three years, Salesforce actually produced more free cash flow than EBIT. There's nothing better than incoming cash when it comes to staying in your lenders' good graces. Summing Up We could understand if investors are concerned about Salesforce's liabilities, but we can be reassured by the fact it has has net cash of US$8.97b. The cherry on top was that in converted 178% of that EBIT to free cash flow, bringing in US$13b. So we don't think Salesforce's use of debt is risky. Another factor that would give us confidence in Salesforce would be if insiders have been buying shares: if you're conscious of that signal too, you can find out instantly by clicking this link. Of course, if you're the type of investor who prefers buying stocks without the burden of debt, then don't hesitate to discover our exclusive list of net cash growth stocks, today. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
