WSJ What’s News - Supreme Court Blocks Trump From Firing Fed Chair

Episode Date: May 23, 2025

A.M. Edition for May 23. While the court said President Trump can remove independent agency leaders, the ruling found the Federal Reserve is unique, providing some relieft o investors. Plus, major U.S. banks are exploring whether to team up to issue a joint stablecoin. And as BYD beats out Tesla in European sales for the first time ever, we look at how China has been building up its high-tech industries with WSJ’s Brian Spegele. Azhar Sukri hosts. Sign up for the WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

What's better than a well-marbled ribeye sizzling on the barbecue? A well-marbled ribeye sizzling on the barbecue that was carefully selected by an Instacart shopper and delivered to your door. A well-marbled ribeye you ordered without even leaving the kiddie pool. Whatever groceries your summer calls for, Instacart has you covered. Download the Instacart app and enjoy $0 delivery fees on your first three orders. Service fees, exclusions, and terms apply. The Supreme Court says President Trump can remove leaders of independent government agencies

except the Fed. Plus Wall Street embraces crypto, as US banks team up to issue a stablecoin. And we look at whether China's efforts to shore up its high-tech industries means the world's second-largest economy can go it alone. Every step in the process now within the Chinese ecosystem is increasingly dominated by Chinese companies. That is something that is very frustrating for the US government in particular. And at the same time, the Chinese government is not apologizing for this at all. It's Friday, May the 23rd.

I'm Azhar Sukri for The Wall Street Journal, filling in for Luke Vargas. And here is the AM edition of What's News, the top headlines and business stories moving your world today. The Supreme Court has ruled that President Trump can remove leaders of independent government agencies but, crucially, not the Federal Reserve. And while the ruling doesn't explicitly prevent Trump from firing Fed Chair Jerome

Powell or any other member of the central bank. The Journal's Chelsea Delaney says it does provide some relief to market participants worried about the Fed's independence. Trump's threats in recent months to fire the Fed chair have really shaken investors. We did see a big sell-off when he was making those threats in April. He's walked them back, but there probably was still an overhang of anxiety among investors about whether the Fed would be able to maintain this independence. So this order definitely will ease some of those concerns, but US markets are on really shaky ground right now.

And as well, the Supreme Court order would expand presidential power. Right now, the president is doing a lot of things that investors are worried about with their presidential power. So it could also fuel some concerns about future use of this newly expanded power. A man charged with murdering two Israeli embassy staffers in Washington, D.C., told investigators he, quote, did it for Palestine and Gaza. Court documents unsealed yesterday show Elias Rodriguez, aged 31, had flown in from Chicago, where he lives, earlier this week. The charges against Rodriguez carry a possible death penalty. The Trump administration's move to yesterday block Harvard University from enrolling foreign

students in an ongoing dispute over anti-Semitism has drawn widespread criticism, with the American Council on Education saying the action was unlikely to withstand legal scrutiny. And now a government investigation has made new findings against Columbia. It says the Ivy League University violated federal civil rights law by ignoring the harassment of Jewish students by classmates. The Department of Health and Human Services Civil Rights Office said the school acted with quote, deliberate indifference towards student on student harassment of Jewish students,

unquote, since the October 7th, 2023 Hamas-led attack on Israel. A Columbia spokesperson said the school takes these issues seriously and will work with the government to address them. We are exclusively reporting that major US banks are exploring whether to team up to issue a joint stablecoin. Conversations are in the early stages, but have involved payment companies co-owned by the likes of JP Morgan Chase, Bank of America, Citigroup, and Wells Fargo, among others. Journal reporter Angus Bowick says that by potentially issuing a digital coin

pegged to a real world currency, banks are trying to fend off escalating competition from the crypto industry. Stablecoins have been this huge success story over the last few years. They've become very useful for people moving money internationally, particularly when there are still significant frictions within the traditional banking system. What the banks are seeing is this stablecoin business model at some point could start infringing on their own. They also feel encouraged that there is stablecoin legislation which is currently moving through Congress. And I think the big banks now see that

it's a good moment for them to try to reclaim some of this new economy. This comes as President Trump reaffirmed his commitment to making the US a crypto capital by hosting owners of his meme coin for a gala dinner last night. Government watchdog groups have said the dinner could potentially violate federal rules against soliciting gifts. According to Inca Digital, a blockchain analytics firm, some $148 million worth of Trump coin was purchased by investors to win spots at the dinner. Yesterday, White House Press Secretary Caroline Leavitt denied that his dinner would trigger any ethics violations because, quote,

"...all the president's assets are in a blind trust which is managed by his children." Shares of Chinese drugmaker Jiangsu Hongri Pharmaceuticals soared more than 30% on their Hong Kong debut today, marking one of the city's largest initial public offerings so far this year. The red-hot IPO market in Hong Kong is largely being driven by Chinese firms seeking secondary listings. In the first quarter of the year, listings in the financial hub quadrupled from a year ago to HK$18.7bn. Tesla's sales continue to slump in Europe, with Chinese automaker BYD outselling Elon Musk's EV maker for the first time last month.

Our European Autos reporter Stephen Wilmot says it's both a sign of Tesla's unpopularity and BYD's rapid expansion in Europe. Tesla's had a very bad start to the year. It's partly to do with Elon Musk, the chief executive's political interventions in Europe, his support for the AFD party in Germany, the largest EV market in particular. There's also the matter of the model Y switch over, which has affected production at the plant in Brandenburg. But then the other thing is the rise of Chinese carmakers and particularly BYD despite tariffs. It's paying almost 30% tariff on imports to the European Union these days, but it's still growing very strongly.

One caveat to that is that Tesla's monthly data is quite volatile, tends to oversupply in certain months and undersupply in others. So it might be a different ranking next month than the month after. Coming up, China has been shoring up advanced technologies long before the trade war began. We look at just how resilient Beijing is after the break. Washington and Beijing may have agreed to a truce in their trade war, but China has for years been busy building a great wall of economic self-sufficiency around itself. Even before President Trump imposed tariffs on Chinese imports during his first term, China had already identified several high-tech areas where it wanted to become less reliant on the outside

world. Those efforts have only grown in recent years, and as senior correspondent Brian Spiegel writes, continue to accelerate under Trump 2.0. And Brian joins us now. Brian, take us through some of the ways that Beijing has been becoming more self-reliant. It's already become competitive with the West in several key high-tech areas, hasn't it? Yeah, that's right. And this is something that's across the board in the Chinese economy. I've lived in Beijing a long time, and a day in Beijing looks like this. You get up and you

get onto your cell phone, you get onto WeChat, the super app here, and you get on your Chinese ride hailing app, and a Chinese electric car comes and picks you up. The telephone itself might be from Huawei, run by a Chinese semiconductor. Every step in the process now within the Chinese ecosystem is increasingly dominated by Chinese companies. And that's not how it was until very recently, actually. No, absolutely. Not that long ago, there were a lot more foreign names

than there are now. So Brian, how are Western governments, and in particular the US responding? So I think one of the challenges of the self-sufficiency drive is that the risk is that there is less space for American or Western companies writ large to operate in China. So it's one thing, yes, Chinese companies are going to become more competitive in their home market. That's a natural process. But I think what frustrates the United States in particular is that things like subsidies for startups in many of these industries, it's not market driven in many ways. I mean we look at

electric vehicles for example. There's billions and billions upon billions of dollars in subsidies every year. How does an American car company compete with that? That is something that is very frustrating for the US government in particular and at the same time the Chinese government, they're not apologizing for this at all. But can China ever become fully self-sufficient? And if not, why not? Yeah, there's two questions we need to unpack here. One is, can they, as you ask? And then the second question is, should they? So on the first part, there's many, many areas of the Chinese economy where complete and total self-sufficiency

is next to impossible. Take food security, for example. China has over a billion people to feed and a finite amount of arable land in the country. They have to import food. And they are working as hard as they can to bring down their reliance on food imports. But at the end of the day, it's going to be very difficult to drop that number to zero. On the second part Should they countries going back for many many centuries in history? They trade for a reason because it's impossible to have competitive advantage in every industry

Every step of the process all of the time even for a manufacturing powerhouse like China It's economically very very difficult to do and to pull that off So I think one of the things that's very much worth considering is as they pursue self-sufficiency is to question, does this make economic sense for China? And despite the fact that we do see progress on the ground every day in their ability to have technological self-reliance, at the same time, the economy is not necessarily benefiting from it. It's not necessarily leading to better economic performance in China.

So let me just pick you up on that last point. What are some of the downsides for China in this self-sufficiency drive? The reality is that there's a lot of waste. When you earmark certain sectors, as the central government does, saying we are going to become self-reliant in these sectors and then the state-run financial Institutions are effectively mandated to go out and lend to these sectors you get a lot of redundancy Hundreds of billions of dollars could rush into a sector over the course of a number of years and you know I think of one economist I was speaking to for this article

They made a point that yes, you can grow rice in a California desert if you spend enough money, but it doesn't necessarily make it good economic policy. So that misallocation of capital is something we really need to consider as we think about the long-term health of the Chinese economy related to this effort. Journal Senior Correspondent Brian Spiegel, thank you so much. Thank you. And that's it for What's News for this Friday morning. Today's show was produced by Kate Bulevant and Daniel Bach. Our supervising producer is Sandra Kilhoff.

I'm Azhar Sukri for the Wall Street Journal, filling in for Luke Vargas. We'll be back tonight with a new show. Until then, have a great weekend and thanks for listening.