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President Donald Trump said he was prepared for a legal fight with Federal Reserve Governor Lisa Cook after he moved to oust her from her post following allegations that she falsified mortgage documents.

The Fed, weighing in for the first time this week, said it would abide by any court decision in Cook’s legal challenge of her dismissal by Trump. A Fed spokesperson added the central bank has deferred any decision on Cook’s current working status, and noted there is no official business before the Fed board this week.

“Lisa Cook has indicated through her personal attorney that she will promptly challenge this action in court and seek a judicial decision that would confirm her ability to continue to fulfill her responsibilities as a Senate-confirmed member of the Board of Governors of the Federal Reserve System,” the Fed said in a statement.

Trump, speaking at a Cabinet meeting on Tuesday, said he was also prepared to abide by any court decision, but indicated he was not concerned about Cook’s challenge.

Today's show features:

• Kathryn Judge, Harvey J. Goldschmid Professor of Law at Columbia Law School, on the legal battle between the White House and the Federal Reserve
• Bloomberg News Equities Reporter Bailey Lipschultz on the Tuesday trade
• Que Nguyen, Partner and Chief Investment Officer, Equity Strategies at Research Affiliates on markets and investing in Big Tech, as well as the Federal Reserve
• Bloomberg Intelligence Senior Defense Analyst Wayne Sanders on US Commerce Secretary Howard Lutnick suggesting that the US government is looking at the defense sector for potential stakes in companies

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Watch Bloomberg Businessweek Daily LIVE every day on YouTube: http://bit.ly/3vTiACF.

Elon Musk accused Apple Inc. and OpenAI in a lawsuit of unfairly favoring the artificial intelligence company across iPhones and thwarting competition for other chatbot makers.

Musk’s X and xAI seek billions of dollars in damages in the suit filed Monday in federal court in Fort Worth, Texas, arguing that Apple’s decision to integrate OpenAI into the iPhone’s operating system inhibits rivalry and innovation within the AI industry and harms consumers by depriving them of choice.

The billionaire founder of xAI Holdings, which now houses the Grok AI team and X social network, said Apple makes it impossible for anyone other than OpenAI’s ChatGPT to reach the top of the App Store charts, a sought-after global spotlight for app developers.

The case sets up a high-stakes court showdown between the richest person on the planet and one of the world’s most valuable companies.

Apple and OpenAI — whose ChatGPT service is the most-downloaded free iPhone app in the US — have a partnership around AI built into the latest iPhones. Musk, 54, has a long-running feud with OpenAI Chief Executive Officer Sam Altman, which dates back to disagreements that led to their split after the two founded OpenAI together a decade ago.

Today's show features:
- Bloomberg News Legal Reporter Madlin Mekelburg on Elon Musk suing Apple and OpenAI over what he sees as threats to AI competition
- Jennifer Lee, Senior Economist and Managing Director of Economics at BMO Capital Markets, on the big week of economic data ahead
- Bloomberg News Chief Correspondent for Global Aviation Siddharth Phillp on Boeing and union leaders returning to the bargaining table
- Christina Cassotis, Chief Executive Officer of the Pittsburgh International Airport, on the upcoming opening of her airport’s new terminal and preparing for the Labor Day weekend travel rush

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Sales of new US homes exceeded forecasts in July after an upward revision to the prior month, as prices eased and heavy incentives enticed more buyers off the fence. Contract signings on new single-family homes ticked down to a 652,000 annualized rate, with the strongest demand in the West, according to a government report issued Monday. The median estimate in a Bloomberg survey of economists was a 630,000 pace.

Katie Hubbard, Executive Vice President of Capital Markets at Walton Global, breaks down the American real estate landscape as market participants await the Federal Reserve's next interest rate decision in September. Katie speaks with Tim Stenovec and Norah Mulinda on Bloomberg Businessweek Daily.

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