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Trump Addresses Decision to Try to Fire Fed Governor; Trump Again Accuses Federal Governor of "Infraction"; Fed Governor Lisa Cook: Trump "Has No Authority" to Fire Me; Trump, Pritzker Clash Over Possible National Guard Deployment to IL; Taylor Swift and Travis Kelce Are Engaged. Aired 3-3:30p ET

Aired August 26, 2025 - 15:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

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[15:01:24]

BRIANNA KEILAR, CNN HOST: President Trump says you're fired to a Federal Reserve governor and she fires back with her lawyer saying we'll see you in court. Ahead, what's behind the latest fed fight with the White House? Why the President says he has the legal right to fire her?

And the Chicago Way: The governor of Illinois says President Trump's troops are not welcome in his state's biggest city. But will the White House back down as it threatens to send the National Guard to several places run by Democrats?

BORIS SANCHEZ, CNN HOST: And we don't know if they'll get married with paper rings, but Taylor Swift and Travis Kelce are getting hitched. We've got so many Taylor Swift song references that I do not understand and major developing stories coming your way right here on CNN NEWS CENTRAL.

KEILAR: Breaking news, President Trump was just asked moments ago during his cabinet meeting about the Federal Reserve official that he is trying to fire, that he said that he has fired. The official is Lisa Cook. She is the governor of the independent bank who not only has said that she is not leaving. But we're being told by her lawyer that she is filing a lawsuit. Let's go right to CNN's Jeff Zeleny at the White House.

Jeff, tell us what the President said about this.

JEFF ZELENY, CNN CHIEF NATIONAL AFFAIRS CORRESPONDENT: Well Brianna, this is the beginning of a legal case that is likely to go to the Supreme Court that will really test the independence of the Federal Board of Reserve. But as we know, President Trump said it was his intention to fire Lisa Cook. She's the first African-American woman to serve on the Federal Board of Reserve. He's been obviously trying to increase his control and certainly ratchet up his criticism of the Federal Board for not lowering interest rates. He says she should be fired for some unproven allegations of fraud relating to her mortgage. He expounded just a few moments ago in the cabinet room.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: She seems to have had an infraction and she can't have an infraction and especially that infraction because she's in charge of - if you think about it - mortgages and we need people that are a hundred percent above board and it doesn't seem like she was.

(END VIDEO CLIP)

ZELENY: So, she has not been charged with a crime. These are unproven allegations made by a housing official in the Trump administration. Mortgage fraud is becoming a central theme that many Democrats are being accused of by Trump administration officials. But in the case of Lisa Cook, she is saying that she cannot be fired without cause. She cannot be fired by the President because of the independent nature of the agency.

So, this is the beginning of a very interesting legal battle that is going to attest the independence of the Federal Board of Reserve. There is no doubt about that. There is precedent in the Supreme Court of about some other specific agencies that the President actually can fire directors of. But this is an independent or quasi-independent group, but it's not just made up of one single director. There is a board of directors. So, this could be a - the Supreme Court weighing in on this for the first time.

Again, the President, there's been no American president who has fired a member or a governor of the Federal Board of Reserve. So, that is why the stakes of this are high as it's setting up a legal challenge. And this cabinet meeting, Brianna, is still going on. Reporters are now asking questions.

[15:04:59]

And, of course, one of the biggest items of the day is that engagement between Taylor Swift and Jason Kelce. And the President has said that he wishes them both luck. Of course, he's had some criticism for Taylor Swift over the years, but he was all positive today. And he said he wishes them both luck. Brianna?

KEILAR: Yes, I do not mean to correct you. Travis Kelce, of course, Jason's his brother.

ZELENY: Travis Kelce, of course. Sorry, (INAUDIBLE), yes.

KEILAR: Yes, but we know - but honestly, no, no, Jeff, it's fair, because I want to know what Jason Kelce is going to do at this wedding. I think he's the one to watch. And I know you know that and that's where you're coming from and I understand that.

ZELENY: Right, for sure.

KEILAR: Obviously, Jeff Zeleny live for us ...

ZELENY: Thanks, Brianna.

KEILAR: ... at the White House. Boris.

SANCHEZ: Let's talk to Roben Farzad about all of this. He's a business journalist and host of Public Radio's "Full Disclosure."

Roben, thanks so much for being with us.

The question of whether Trump has legal standing to fire Lisa Cook is something that is likely going to be litigated. Her attorneys have vowed that they will sue the administration if these allegations, though, stand that she manipulated these applications to have two primary residences as she was applying for these mortgages. Does it put her ability to serve into question?

ROBEN FARZAD, BUSINESS JOURNALIST & HOST, "FULL DISCLOSURE": I mean, can you imagine these guys in the Oval Office or in some war room over there with Trump realizing this? This is brought by his, you know, his cabinet team. He's like, I am shocked, shocked that she applied for double mortgages. It's like ripping off a tag on a pillow, especially in the context of what Trump is alleged into what - adjudicated to have done with his own companies.

I think it's made up. Clearly, this is a matter of Fed stacking and Fed sacking. He wants the numbers in there. You've seen court packing before. You just saw it with gerrymandering in Texas. And if you look at the Federal Reserve, I mean, it's typically sacrosanct, but it's another rail of government. It's another branch of government that's supposed to be intensely independent of the White House. This is him trying to break another precedent.

SANCHEZ: Well, this is going to sound like a dumb question, but I think it bears emphasis at a moment like this. Why is it that markets especially value the independence of the Fed?

FARZAD: You have a dual mandate as a Federal Reserve chair, and, you know, this is not like many of the countries that we study, whether Turkey, Venezuela, others, or Russia, if you're not happy with the way things are, you sack the central banker. I mean, he's serving at the at the pleasure of a totalitarian person or a dictator or a strongman here.

What's made the United States economy and capital markets so unique over time is that we have this dual focus on full employment and stable prices. And if you're getting all this jawboning from your president, whether or not he appointed you, that's going to take your eye off that ball, right? I don't know how many metaphors I just mixed there, but this has been something that since the Fed was founded in 1913.

By and large, presidents - look, they complain, they go off - they say parenthetically to the press, you know, I think rates are too high. But they've never gone out and kneecapped even their own appointee the way Donald Trump has. And to further undermine Powell, who's on the way out, as, you know, his term expires next year and Trump has already been calling him, what was it, not a knucklehead or a numbskull. He's trying to shore up the votes because you have to have an FOMC votes. So, his appointees have been in there advocating for Fed rate cuts,

while the inflation numbers have been too high to support that. So, he's trying to stack the Fed and the markets are bound to recoil when and if that happens.

SANCHEZ: I wonder what the Fed's next monetary policy meeting is going to look like. It's less than a month away.

FARZAD: Yes, and Powell did come out and telegraphed that rate cuts are indeed a possibility. Look, there are weak patches in the economy, but we're coming off of a really hard-hitting inflation and an unbelievable expansion of the Fed's powers coming out of the pandemic. And they waited too long to hike. And there's always a risk that they're going to cut too soon.

And inflation, as we know, is a pernicious (INAUDIBLE) really hard to put that back in and he'll be long gone by the time we're dealing with this, whether or not that's a Trump appointee. So, this is getting dangerous.

And I think another check on this White House has been the capital markets. If the stock market recoils, if the bond markets kind of come out and say, whoa, you're politicizing central banking, then watch out. These are powers that are far bigger than this president's.

SANCHEZ: Obviously, replacing Cook would give Trump appointees a majority on the board. And you've talked about it being sort of stacking on the Fed. You wouldn't expect Trump appointees to do anything other than rubber stamp his demands for cuts.

FARZAD: Look at his record with his Cabinet appointees. Look at his first experience as president. He came out and castigated the likes of his state secretary, his attorney general, the FBI director for not being loyal to him.

[15:10:05]

It's one thing to be loyal to the institution, loyal to the mandate, loyal to public service and to being a true patriot versus being loyal to who appointed you. Kind of fealty to the President. We've seen that he's underscored that time and time again. And you see it currently with the FBI director. You see it currently with the Attorney General. He values loyalty, personal loyalty above all else.

SANCHEZ: Robin Farzad, thanks so much for the time. I appreciate it.

FARZAD: My pleasure. Thanks.

SANCHEZ: Brianna.

KEILAR: As President Trump considers expanding his National Guard activations to other Democratic-run cities, Republicans on the Hill are looking into whether the nation's capital has been downplaying its crime numbers. The GOP-led House Oversight Committee is now launching an investigation following a similar probe by the Justice Department. For weeks, the President has claimed without citing evidence that

Washington's police department has manipulated crime statistics, a view also alleged by the union representing police officers there.

Now, Chicago seems to be next on the President's list, putting him at odds with Illinois Governor J.B. Pritzker, who told Trump bluntly, do not come to the city. And today, President Trump responded.

(BEGIN VIDEO CLIP)

TRUMP: They threw him out. He's governor of Illinois and he goes about Trump, we don't need his help. Chicago is the worse. These places are really bad. Crime in D.C. was the worst it ever was. You know, they make up stories. Crime in D.C. was the worst ever in history. And now over the last 13 days, we've worked so hard.

(END VIDEO CLIP)

KEILAR: CNN's Whitney Wild is joining us now from Chicago.

Whitney, tell us how people there feel about this prospect of the Guard potentially coming to their city.

WHITNEY WILD, CNN LAW ENFORCEMENT CORRESPONDENT: Brianna, we've heard a mix of reactions. We've spoken with a wide range of people. We spoke with an older man who is the head of the Committee on Immigrant and Refugee Rights. We spoke with people who live here. We've heard from gun violence survivors.

And what we are seeing is that there is a bit of a mix here. It's not as simple as saying everybody in Chicago is opposed to this idea. I spoke with two people who said that they support this idea. What city leaders are leaning on here is that they believe Chicago is in many ways a crime success story. And what they are saying here and they're putting to the city data is that just look at the numbers.

There are dramatic drops in major crime categories. There's dramatic drops in the number of homicides, the number of shootings, the number of carjackings. There are these - there's the data right there for you to see for yourself, Brianna. What you're seeing here are double digit drops in some of the highest profile major crime categories.

And so, Illinois leaders are saying - they're not saying that there is not crime here. They're saying that they do not think that there is an emergency that warrants this type of National Guard intervention.

When I speak with people here again, there's a mix of reaction. There are gun violence survivors who spoke out today who said, absolutely, this is not the right decision. The National Guard is not the answer. Here's more from what they had to say earlier today.

(BEGIN VIDEO CLIP)

YOLANDA ANDROZZO, EXECUTIVE DIRECTOR, ONE AIM ILLINOIS: Once again, our communities are being threatened by policies rooted in fear. The Trump administration's threat to send a National Guard troops to Chicago is not about safety. It is not about safety. It's about control through intimidation and fear.

SAMUEL MORMON, GUN VIOLENCE SURVIVOR: We have PTSD already. So, what do you think the military is going to do when we see them? Do you think some of us want to see the same guns that were used against us?

(END VIDEO CLIP)

WILD: There are other people, Brianna, who say this is the right answer. Here's one woman who told me how she felt when she heard the news the National Guard would come to Chicago. Let's listen.

(BEGIN VIDEO CLIP)

AMEENAH HAQQUE, CHICAGO RESIDENT: My first reaction was that this is a good thing. I think that the governor, as well as the mayor, should be on board with it just so we can get a bit more of security in Chicago the way that we need.

WILD: The crime has dropped since 2024. Do you feel like the city feels safer?

HAQQUE: No, not at all. No, especially with the police being defunded.

(END VIDEO CLIP)

WILD: There is data to show that there has been an increase in funding for the Chicago Police Department. So, Illinois leaders have made very clear that they plan to fight this in court, Brianna. At this point, the Illinois attorney general said that he doesn't believe they can do anything preemptively. They can't fire - file an injunction preemptively in court, although he didn't rule out the possibility of something going to court before the National Guard gets here.

But the moment they feel like they have a really solid case, that's when they plan to fight this in court. Bri.

KEILAR: Yes. This really speaks to why this is such a difficult political issue. As you said, data points to an increase in funding. But people don't always experience it that way. That woman obviously very concerned about crime.

[15:15:01]

She doesn't feel safe. And this is what Democrats are confronting as they're battling President Trump on this issue.

Whitney, thank you so much for talking to people and bringing that to us. We really appreciate it.

Still to come, Tay-Tay is tying the knot. What we know about her engagement to Travis Kelce.

Plus, President Trump's plan to prosecute flag burners could go against a Supreme Court ruling that declared it protected speech.

And then later, a college professor says he received his best student reviews in more than a decade after banning one thing from his classroom. Guess what it is.

We'll have those stories and more all coming up on CNN NEWS CENTRAL.

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[15:20:02]

KEILAR: Taylor Swift and Travis Kelce are saying yes to forever. You hear that music? We can bring it up a little, guys, for the ambiance. Yes, beautiful. The 14-time Grammy winner and the three-time Super Bowl champion announcing their engagement on Instagram, of course, with a series of engagement photos. This caption, "Your English teacher and your gym teacher getting married."

You can see Travis Kelce there on one knee, proposing to Taylor in what appears to be just a beautiful garden.

SANCHEZ: Yes, a mythical garden. And then a picture of the ring. Not bad. Not bad. The post already has more than 13 million likes. With us now to discuss, entertainment journalist Brian Balthazar.

Brian, thanks so much for being with us. Your reaction to this news, it's a huge deal.

BRIAN BALTHAZAR, ENTERTAINMENT JOURNALIST: It is a huge deal. In fact, if you search Taylor Swift on Google, it erupts in confetti. You don't see that every day on Google, right? So, this is a post that Kate Middleton and Prince William liked. This is giving you a sense of the cultural significance.

And also, you know, you can't help but be happy for an artist and athlete. And an artist whose musical kind of repertoire has often been about love. The search for love. Love gone wrong to finally have the love that she's been searching for. You know, her song, you can do it - "I Can Do It With a Broken Heart." You know what you can't do with a broken heart? Get engaged in a garden like that, you know?

And that ring, already the appraisals are coming in. It's been valued at between $250,000 or $500,000. But, you know, now that it's Taylor Swift's ring, it's worth much, much more.

KEILAR: Yes, I'm going to go with north of that. Okay, so she, you know, drops hints, the Easter eggs. And I just wonder if you saw this coming. And I will say, I sort of felt like, well, they've been together for a long time. So, it's going to happen, right? But were there any little crumbs that she left?

BALTHAZAR: Well, it's interesting you say that. Because as you said, she is all about hints and clues and signs. And I've been wondering that, too. I will say, I did predict this among friends that she would get engaged this year. Does that count for anything? But I think she's ...

SANCHEZ: Yes.

BALTHAZAR: ... I think now, we have the Swifties who are really, really minority report, kind of Da Vinci coding this, right? They're going in like CSI, trying to find all the hints and clues. And I'm sure they'll come up with some they can assume. But I do think that Taylor and Travis have treated this with a certain level of sacredness, their relationship, and not treated it like part of the business. And I think that's partly why this is such a successful union.

You know, she's all about breaking records. I'm sure we'll hear about breaking records. She just broke a Guinness record about a week ago or 30 days ago when she went on her soon-to-be brother-in-law's podcast for the most concurrent listens to a podcast at one time. I think we're going to break some records today with likes and Google searches.

But as far as clues, we may never know. I think she treats this with a little bit of sacredness that I really like.

SANCHEZ: I'm curious, Brian, just stepping back, if you could talk about her trajectory and her ascendance. Because about 15 years ago, I think 15 years ago, was the first time that I'd ever heard of her. And I was like, nah. And then over time, she's just become such a force in American life. We had one guest earlier who described her as inescapable. Talk to us about how she got to where she is right now.

BALTHAZAR: Yes. You know, I'm thinking back to her early music, that Romeo and Juliet - that "Marry me, Juliet," where it pulls out a ring and says, marry me. You know, she is all about her relatability, particularly as she started to young girls. And that kind of pining quality, the romantic quality, and an innocence that she had, despite what was an incredible amount of success.

One could say it took a while, but also it really did become incredibly big very quickly when you really, really look at her career. The way she can connect with people all around the world, regardless of their language, regardless of where they are, she's connecting on a very personal level with what it is to want to feel love, to be in love, and to connect with both the people she's in a relationship with. In the past, she's had relationships that have been very public. Her breakups have been chronicled in every magazine and television show imaginable. That is the part that most people can't relate to, but what they can relate to is how she is - she's just infinitely relatable. I don't know how else to say it.

I mean, it is spelled out to be an incredibly lucrative - combining that with her incredible talent for musical writing, composition, and performing, that what an incredible career she's built worldwide, records broken, both in dollars and attendance. There's something about Taylor Swift that people like, people connect with. They want to either be her friend, be her best friend, or date her. Well, they can't date her anymore because she's got an amazing fiance.

KEILAR: Yes. They want to be her. And, Brian, so great to have you because we are just going to be - everyone's going to be watching this and talking about it and it's great to talk with you about it.

[15:25:03] Brian Balthazar, thank you.

BALTHAZAR: Thank you.

SANCHEZ: Still to come this hour, a man arrested after setting fire to an American flag just outside the White House hours after President Trump signed an order cracking down on flag burning, an order that could contradict previous Supreme Court rulings. This story, coming your way in just moments.

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