Coin Press - Trump's attack on the Dollar

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Trump's attack on the Dollar

An unprecedented conflict between the US President and the Federal Reserve is causing unrest on the financial markets. In mid-January 2026, it was announced that the US Department of Justice had issued grand jury subpoenas to the Federal Reserve System. Officially, the investigation concerns allegedly overpriced renovation work on historic administrative buildings, but the chairman of the Federal Reserve, Jerome Powell, stated in a video message that these investigations were being used as a pretext. The threat of punishment was aimed solely at subjugating the Federal Reserve's independent interest rate policy. Powell emphasised that the Federal Reserve fully complies with Congress's statutory oversight rights and called the investigation an unprecedented political interference. He fears that the issue at stake is whether monetary policy is based on data or controlled by political pressure.

Since his return to the White House in January 2025, the US President has repeatedly insulted Powell in a completely questionable manner and urged him to resign. Because the Federal Reserve only lowered interest rates gradually in 2025 and attributed the high inflation largely to the US government's protectionist course, the President increased the pressure. He called the central bank chief a ‘moron’ and a “bonehead” and threatened to sue him for ‘incompetence’. Behind the investigation is the prosecutor he appointed in Washington, who used the renovation costs as a reason to initiate criminal proceedings. According to reports, neither the Attorney General nor her deputy were informed in advance.

Reactions from politicians and experts
The legal offensive sparked sharp criticism across party lines. Several Republican senators made it clear that they would not confirm any nominations to the Federal Reserve Board while the investigation was ongoing. Democratic lawmakers described the move as an attack on the rule of law and a step towards autocracy. They warned that the President wanted to ‘lock up’ the Fed chairman simply because he did not align his interest rate policy with the White House's ideas. Former Fed chairmen and leading economists also warn that this is reminiscent of countries with weak institutions where the government controls the central bank – often with fatal consequences for price stability and the economy. Even market liberals warned that the misuse of criminal prosecution could drive away investors and undermine confidence in the United States.

Internationally, numerous central bankers expressed solidarity with Powell. They pointed out that an independent monetary policy is essential to ensure long-term price stability and a functioning economy. Some observers compared the current developments with authoritarian practices in Turkey or Venezuela, where populist governments attempted to control monetary policy, triggering hyperinflation.

Impact on the financial market
The markets reacted sensitively to the escalation. After the threat of sanctions became known, the US dollar fell significantly against major currencies. The dollar index, which measures the strength of the US currency against a basket of other major currencies, slipped by almost half a percent. The euro rose above 1.16 US dollars, the Swiss franc reached a ten-year high against the US currency, and investors fled to safe havens such as gold and silver. Analysts explained that the threat of losing central bank independence and the prospect of even higher US debt in the future are deterring investors. Gold rose to over $4,600 per troy ounce, and silver prices also reached record highs.

Uncertainty about future interest rate policy caused yields on long-term US government bonds to rise as investors demanded higher risk premiums. At the same time, the stock market initially recorded losses, but technology stocks later supported prices. Some analysts warn that sustained political pressure on the Federal Reserve could lead to higher inflation, capital flight and a depreciation of the dollar. Nomura currency strategists also pointed out that, in addition to geopolitical risks, it is above all the loss of confidence in US monetary policy that is weighing on the dollar.

Possible consequences for the dollar
The president's attacks on the Federal Reserve are not a new phenomenon. Back in 2025, the US currency had already lost significant value following repeated public insults directed at the head of the central bank. Analysts noted that the dollar index posted double-digit losses over the course of the year and that the extreme volatility on the currency markets was linked in particular to attempts to exert political influence on monetary policy. Then, as now, protectionist tariff policies and efforts to force interest rate cuts are driving up inflation. Investors fear that a politically compliant central bank will cut interest rates too sharply, triggering a spiral of inflation.

In addition to domestic political tensions, international factors are also weighing on the US dollar's status as the world's reserve currency. The global community is watching closely to see whether the US will continue to pursue a predictable monetary policy or whether political interests will weaken the reserve currency. If investors withdraw from the dollar on a large scale, alternative reserve currencies such as the euro or the Chinese yuan could gain in importance. Digital central bank currencies could also benefit from this.

Looking ahead ‘for the time being’
Jerome Powell is expected to remain Chairman of the Federal Reserve until the end of his term in May 2026, even though the White House is already sounding out potential successors. If the President appoints a loyal candidate, the Senate could delay the appointment due to ongoing investigations. Some observers believe that Powell – whose term as governor does not end until 2028 – could remain on the board despite the threat of sanctions in order to defend the independence of the central bank.

The coming months will show whether the United States can maintain its traditionally strong central bank independence. The conflict between the president and the Federal Reserve chief is already having a noticeable economic impact and is calling into question confidence in the US dollar as a global reserve currency. Economists warn that an independent monetary policy is a cornerstone of economic stability and must not be sacrificed to day-to-day politics.

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Stargate project, Trump and the AI war...

In a dramatic return to the global political stage, former President Donald J. Trump, as the current 47th President of the United States of America, has unveiled his latest initiative, the so-called ‘Stargate Project,’ in a bid to cement the United States’ dominance in artificial intelligence and outpace China’s meteoric rise in the field. The newly announced programme, cloaked in patriotic rhetoric and ambitious targets, is already stirring intense debate over the future of technological competition between the world’s two largest economies.According to preliminary statements from Trump’s team, the Stargate Project will consolidate the efforts of leading American tech conglomerates, defence contractors, and research universities under a centralised framework. The former president, who has long championed American exceptionalism, claims this approach will provide the United States with a decisive advantage, enabling rapid breakthroughs in cutting-edge AI applications ranging from military strategy to commercial innovation.“America must remain the global leader in technology—no ifs, no buts,” Trump declared at a recent press conference. “China has been trying to surpass us in AI, but with this new project, we will make sure the future remains ours.”Details regarding funding and governance remain scarce, but early indications suggest the initiative will rely heavily on public-private partnerships, tax incentives for research and development, and collaboration with high-profile venture capital firms. Skeptics, however, warn that the endeavour could fan the flames of an increasingly militarised AI race, raising ethical concerns about surveillance, automation of warfare, and data privacy. Critics also question whether the initiative can deliver on its lofty promises, especially in the face of existing economic and geopolitical pressures.Yet for its supporters, the Stargate Project serves as a rallying cry for renewed American leadership and an antidote to worries over China’s technological ascendancy. Proponents argue that accelerating AI research is paramount if the United States wishes to preserve not just military supremacy, but also the economic and cultural influence that has typified its global role for decades.Whether this bold project will succeed—or if it will devolve into a symbolic gesture—remains to be seen. What is certain, however, is that the Stargate Project has already reignited debate about how best to safeguard America’s strategic future and maintain the balance of power in the fast-evolving arena of artificial intelligence.

Iran and the holy War risk

For now, Iran does not appear to be launching a formal holy war. But the question is no longer rhetorical. After the bombings that turned a long shadow conflict into an open regional war, religious language has moved from symbolic background noise toward the center of state messaging. The more important issue is not whether Tehran will suddenly summon the Muslim world into a single, borderless struggle. It is whether the Islamic Republic will fuse military retaliation, political succession, proxy activation and sacred rhetoric into a broader campaign that functions like a holy war without ever formally declaring one.The current crisis is already historic. Since the joint U.S.-Israeli attack of February 28, which killed Supreme Leader Ali Khamenei and struck Iranian state and military targets, the conflict has spread across Israel, Lebanon, the Gulf and the energy corridors that underpin the global economy. Public death tolls inside Iran alone have climbed into the four figures. Even though international nuclear inspectors said early in the campaign that they had no indication several key nuclear installations had been hit or that radiation had spread beyond normal levels, later stages of the war clearly broadened toward oil storage, airports, command sites and urban infrastructure. This is no longer a contained deterrence exchange. It is a live contest over regime survival, regional order and strategic endurance.That is precisely why the phrase “holy war” must be handled with care. In January, influential voices inside Iran had already warned that any attack on the Supreme Leader would amount to a declaration of war against the wider Islamic world and could require a jihad decree. That language mattered then, and it matters even more now because the red line was crossed. Tehran can plausibly argue to its own hard-line base that the highest religious and political authority in the Islamic Republic was not merely challenged but assassinated. In ideological terms, that transforms retaliation from a policy choice into a sacred obligation. In political terms, it gives hard-liners a ready-made framework for widening the war.Yet rhetoric is not the same as doctrine, and doctrine is not the same as operational behavior. Iran’s response so far looks less like an uncontrolled call to universal religious uprising than a grim, state-directed campaign of calibrated punishment. Tehran has struck back with missiles, drones, maritime pressure and pressure on regional hosts of U.S. military power. It has also tried to impose costs on the world economy by turning the Gulf and the Strait of Hormuz into instruments of leverage. This is not the behavior of a leadership abandoning strategy for blind zeal. It is the behavior of a regime trying to survive by making the war too costly, too wide and too economically dangerous for its enemies to sustain indefinitely.That distinction matters. A genuine, formal holy war would imply a sweeping call for open-ended religious mobilization across borders, one that subordinates ordinary state interests to an all-consuming theological struggle. Iran has not done that in any clear, universal sense. It has instead behaved as a revolutionary state that uses sacred language to reinforce legitimacy, discipline supporters and justify retaliation. That model predates the current crisis. The Islamic Republic has always blended theology, nationalism, martyrdom culture, anti-Western resistance and hard security logic. The bombings have intensified that blend, but they have not erased the regime’s instinct for calculation.The strongest evidence against an immediate full holy-war scenario is inside Iran itself. The system’s first imperative has not been global mobilization; it has been continuity. Even after decapitation strikes, the state moved to preserve command structures, delegate powers downward and push the Assembly of Experts toward selecting a successor. By March 8, that succession process had reportedly advanced to the point where a decision had been reached, even if the name had not yet been publicly revealed. That is a survival reflex. Regimes preparing for limitless religious war do not usually prioritize constitutional succession, elite cohesion and internal control. Regimes fighting for their lives do.Iran’s regional behavior also shows tension between ideological fury and strategic restraint. President Masoud Pezeshkian’s apology to Gulf neighbors was extraordinary, not because it ended the war, but because it exposed the conflict inside Tehran’s own response. On one side sits the logic of escalation: punish every state that hosts U.S. forces, widen the crisis, raise oil prices, frighten shipping markets and prove that the bombardment of Iran cannot remain geographically contained. On the other side sits the logic of isolation avoidance: do not drive every Arab state irreversibly into the opposing camp, do not convert every neighbor into an active launchpad for anti-Iran operations, and do not make regime survival impossible by fighting the entire region at once.This internal contradiction is one reason the phrase “holy war” can mislead. What is unfolding is more dangerous in practical terms and more limited in formal terms. Iran may never issue a clean, universal call for a civilizational war against all enemies of Islam, yet it can still encourage clerical sanction, mobilize militias, inspire cross-border attacks, bless cyber retaliation, empower covert cells and unleash proxy violence under a sacred frame. That would be a hybrid escalation: not a single global summons, but a diffuse religious legitimization of a long, dirty regional war. For civilians, ports, airports, desalination plants, shipping lanes and energy markets, the difference may feel almost academic.The role of Iran’s allied armed networks reinforces that point. Hezbollah has entered the conflict, but not from a position of unchallenged strength. Its intervention has deepened political strain in Lebanon and highlighted how even Iran’s most loyal partners are balancing solidarity against self-preservation. Other aligned groups face similar pressures. The so-called axis can still hurt Israel, U.S. assets and regional infrastructure, but it is not a frictionless machine awaiting one theological command to move in perfect unity. The more Tehran leans on proxies, the more it reveals that its preferred method remains layered coercion, not a single dramatic declaration of holy war.There is also a sectarian and geopolitical reality that limits the holy-war model. The Muslim world is not a single mobilizable bloc waiting for instructions from Tehran. Iran is a Shiite theocratic state with revolutionary ambitions, but its appeal across Sunni-majority states is uneven at best and sharply contested at worst. Gulf monarchies, already targeted by Iranian missiles and drones, are not natural participants in an Iranian-led sacred struggle. Many of them fear Tehran at least as much as they oppose the bombing campaign against it. That means Iran’s religious messaging may galvanize sympathizers, militants and ideological fellow travelers, but it is unlikely to unify the wider Islamic world behind one war banner.Still, dismissing the danger would be a grave mistake. The holy-war language matters because words can widen the menu of violence. Once a conflict is framed as sacred defense rather than national retaliation alone, thresholds can drop. Assassinations, sabotage, maritime attacks, strikes on civilian-linked infrastructure and violence by semi-deniable actors all become easier to justify. A state under bombardment, mourning its supreme leader and fighting for institutional survival may decide that conventional retaliation is not enough. If Tehran concludes that it cannot win symmetrically, it may authorize a looser, more ideological pattern of warfare stretching from the Gulf to the Mediterranean and beyond.The economic front is equally important. Iran understands that energy fear can be weaponized. Even limited disruption in the Strait of Hormuz sends shockwaves through insurance, shipping, aviation and inflation expectations worldwide. That leverage is politically valuable because it turns a military confrontation into a global pressure campaign. A formal holy war would demand maximal ideological mobilization. A survival war, by contrast, rewards selective disruption, ambiguity and controlled chaos. Tehran’s actions so far fit the second model more closely than the first.This is why the most serious answer to the headline question is not a simple yes or no. Iran is unlikely to launch a classic holy war in the simplistic sense of a formal, total religious call to arms that instantly unites the Muslim world under its banner. But it is already moving toward something more contemporary and, in some ways, more destabilizing: a war of survival wrapped in sacred legitimacy, regional coercion and asymmetric retaliation. The bombings have not merely invited revenge. They have strengthened the argument of those in Tehran who believe compromise invites death and that only resistance sanctified by faith can preserve the system.So the real risk is not that Iran suddenly abandons strategy for theology. The real risk is that strategy and theology fuse more tightly than before. If that fusion hardens, the war will not remain a sequence of missile exchanges and air raids. It will become a broader contest over succession, legitimacy, energy, maritime freedom, proxy warfare and the right to define resistance as a religious duty. In that environment, the phrase “holy war” may remain officially ambiguous, but its practical effects could become visible across the entire region.