On the one hand, this may reduce the OCC's level of risk. On the other hand, if the market is informed that the OCC has suspended a broker-dealer from membership, market participants are very likely to stop doing business with that broker-dealer. In other words, as a practical matter, the OCC's action would likely put the suspended broker-dealer out of business. It is thus a worrisome power to be able to exercise on a quick and discretionary trigger.

There is some irony in Senator Warren, who is always supportive of giving government regulators more authority, arguing that they are so readily susceptible to corruption. Perhaps she is mindful of Mr. Will Rogers' famous remark that "America has the best politicians money can buy."

It is also reasonable to observe that there are other organized groups, such as unions serving employees who work for the relevant government entities, that are permitted to provide political contributions…

The division of collateral requirements (which is to say of risk management) between the CFTC and SEC is highly inefficient and raises costs, as firms must post excess collateral to account for the fact that related risks that should set off against each other are aggregated where one risk is in CFTC-regulated products and the other is in SEC-regulated products.  

While it is difficult to identify a single provision of Dodd-Frank as the absolute worst of that leviathan, empowering the CFPB to determine its own funding needs, outside the control of Congress, surely ranks in the top 10. Regulatory agencies are not supposed to have their own no-limit credit card.