Governor Kugler did not attend or vote in the FOMC meeting this week (the official vote was 9 to 2). The Fed said we was attending to a "personal matter." Two days later, she steps down. (Kugler's last day is August 8.) I wish her well. --- Kugler's seat as a Fed governor was going to end in January 2026. She was not going to be reappointed as Trump needs this seat to appoint Powell's successor (unless he picks current Fed Governor Chris Waller). Trump can now nominate Powell's successor at any time and demand that the Senate confirm his nominee before the next FOMC meeting on September 17. This means the FOMC will have AT LEAST three solid votes to cut rates. In my opinion, the probability that Trump will move to fire Powell, most likely "for cause," around the renovation of the Fed buildings, is 45%. This is less than 50%, but significantly higher than the betting markets currently have it, at around 15%. Furthermore, I suggest that Powell's firing will likely hinge on his speech at Jackson Hole at the end of the month. If Powell opens the door to a September cut, Trump will not fire him. If Powell pushes back on a September cut, Trump will move to fire him. Powell will not leave, and they will go to court to sort this out. At this point, everything hits the fan.