The Fed independence dispute
The Department of Justice has opened an investigation into Powell, a move that bankers and economists say threatens the political independence of the institution responsible for setting U.S. interest rates.
Vince told reporters that going after the Fed’s independence “doesn’t seem, to us, to be accomplishing the administration’s primary objectives for things like affordability, reducing the cost of borrowing, reducing the cost of mortgages, reducing the cost of everyday living for Americans.”
“Let’s not shake the foundation of the bond market and potentially do something that could cause interest rates to actually get pushed up, because somehow there’s lack of confidence in the Fed’s independence,” Vince added.
Dimon expressed personal regard for Powell while stopping short of endorsing every Fed decision. “I don’t agree with everything the Fed has done. I do have enormous respect for Jay Powell, the man,” Dimon said.
Trump, speaking to reporters at Joint Base Andrews after returning from a day trip to Michigan, called Powell “a bad Fed person” who has “done a bad job” and dismissed the banking executives’ concerns.
“Yeah, I think it’s fine what I’m doing,” Trump said.
The credit card rate cap
Trump has proposed a 10% cap on credit card interest rates, describing it as an affordability measure with midterm elections approaching. Whether the administration intends to pursue the cap through executive action or by pressuring the industry into voluntary compliance remained unclear.
The average interest rate on credit cards is between 19.65% and 21.5%, according to the Federal Reserve and other industry tracking sources. Researchers at Vanderbilt University found that a 10% cap would cost banks roughly $100 billion in lost revenue per year.
JPMorgan’s Chief Financial Officer Jeffrey Barnum indicated the industry was prepared to fight the proposal with all resources at its disposal. JPMorgan holds $239.4 billion in customer credit card balances and operates major co-brand partnerships with United Airlines and Amazon. The bank also recently acquired the Apple Card portfolio from Goldman Sachs.
“Our belief is that actions like this will have the exact opposite consequence to what the administration wants in terms of helping consumers,” Barnum said. “Instead of lowering the price of credit, it will simply reduce the supply of credit, and that will be bad for everyone: consumers, the broader economy, and yes, for us, also.”
Ed Bastion, CEO of Delta Air Lines — whose co-brand card with American Express generates billions in revenue — said the cap would cut lower-income consumers off from credit access entirely.
“I think one of the big issues and challenges with (a potential cap) is the fact that it would actually restrict the lower end consumer from having access to any credit, not just what the interest rate they’re paying, which would upend the whole credit card industry,” Bastion said.
Trump pushed back directly at Dimon in comments to reporters. “We should have lower rates. Jamie Dimon probably wants higher rates. Maybe he makes more money that way,” Trump said.
Overnight, Trump separately endorsed on his Truth Social platform a bill introduced by Sen. Roger Marshall, R-Kansas — the Credit Card Competition Act — which would likely reduce the fees banks collect from merchants when credit cards are used at point of sale.
“Everyone should support great Republican Senator Roger Marshall’s Credit Card Competition Act, in order to stop the out of control Swipe Fee ripoff,” Trump wrote.
Context
The standoff follows a period in which Wall Street broadly supported the Trump administration. Trump signed the One Big Beautiful Bill into law in July, delivering significant tax cuts and cutting the Consumer Financial Protection Bureau’s budget by nearly half. Bank regulators have also pursued a deregulatory agenda that financial institutions have largely embraced.
JPMorgan, the nation’s largest consumer and investment bank, and BNY both reported quarterly results Tuesday. Citigroup, Bank of America, and Wells Fargo were scheduled to report results later in the week.