Will Trump end the Federal Reserve?

The core obstacle is that “ending the Federal Reserve” is not a normal executive action. The Fed is embedded in statute, has staggered governor terms, and is protected by legal and institutional norms that make outright abolition or total capture hard without Congress and, likely, a major political realignment. That keeps the baseline probability low. Even so, this market should not be treated as a simple yes/no on formal repeal only. A determined president can still do damage through appointments, pressure campaigns, aggressive reinterpretation of independence, and attempts to reshape the central bank’s authority, and those pathways create a real tail risk that something close to “ending” the Fed could occur in practice even if the name survives.

Against the current market price, my estimate is meaningfully higher. A 5% price assumes the event requires a very clean, formal abolition path and discounts the chance of a broader resolution standard or an extraordinary political crisis that produces a transformed Fed by 2029. I think that is slightly too conservative given Trump’s demonstrated willingness to test institutional limits, the ongoing conflict over rates and leadership, and the possibility that personnel control plus legislative pressure could push the institution far enough toward dysfunction that this market could resolve Yes under some interpretations. Still, the legal hurdles are so substantial that the most likely outcome remains No; the mispricing, in my view, is on the upside tail rather than on any expectation of outright abolition.