Anyway, given his track record and the way Ohio is tracking politically, successfully seeking elective office seems out for Cordray. Which is all a long of saying he’s available for other work, specifically the work that’s been left undone since Randal Quarles’ term ended, and arguably long before then.

President Biden is considering Richard Cordray, the first director of the Consumer Financial Protection Bureau, to serve as the Federal Reserve’s top banking regulator, according to people familiar with the matter…. The White House said last week it would announce additional Fed appointments beginning in early December.

And, well, wouldn’t you look at who his fairy godmother is one again, looking for something to ease the pain of seeing Jay Powell renominated.

Sen. Elizabeth Warren (D., Mass.) has privately pushed senior White House officials to consider Mr. Cordray for the role, one of the people familiar with the matter said…. Without citing a specific candidate, Ms. Warren said Monday that the Fed job should go to “someone who has the insight to recognize how important regulation is to the effective functioning of the financial markets and has the courage to follow through on that insight.”

White House Considering Richard Cordray as Top Fed Banking Regulator [WSJ]

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"I've had the opportunity to serve in the Council of Economic Advisers, the Treasury and the Federal Reserve across four administrations, as part of a career in economic policy, academia and the private sector that has spanned nearly 40 years, and I've always acquitted myself honorably and with integrity with respect to the obligations of public service," Fed Vice-Chairman Richard Clarida said during a virtual appearance.

Which I guess means we still have to listen to him, at least until his term expires in January.

"A gradual tapering of our asset purchases that concludes around the middle of next year may soon be warranted," he said in remarks delivered virtually at a conference on Tuesday.

Someone we don’t have to listen to anymore, or at least not as closely, is Clarida’s fellow Trump appointee Randal Quarles, who as of tomorrow is no longer the Fed’s vice chairman for bank supervision. In fact, as of tomorrow, no one is, because Democratic presidents are apparently uninterested in filling a role that they created as part of the Dodd-Frank law.

President Biden hasn’t nominated anyone to succeed Mr. Quarles as vice chairman. A White House official Tuesday said Mr. Biden remains engaged with his senior economic team on coming Fed personnel matters and “will make decisions in a thoughtful matter….”

The succession plan around Mr. Quarles’s post has generated significant interest because of questions over how pending merger applications, bank regulatory issues and related business will be handled. His post was created by the 2010 Dodd-Frank legislation that overhauled financial regulation, and Mr. Quarles was the first person formally nominated to the position.

Clarida Defends Himself Amid Federal Reserve Trading Controversy [WSJ Pro]
US economy almost ready for less stimulus, Fed official says [AFP via Yahoo! News]
Fed’s Bank Supervision Committee Will Have No Chairman After Quarles Term Ends Wednesday [WSJ]

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

“At the height of the market, we were managing just over $200 million,” [Raees] Cajee said…. Mr. Cajee said he and Ameer Cajee are in hiding because they have received death threats….

“We dealt with a lot of high-level South Africans, a lot of politicians, a lot of high-level businessmen within South Africa, as well as celebrities,” Raees Cajee said in the interview. “Some particularly very, very dangerous people—that we had not actually known were clients—have started to come out of the cracks.”

And, hey, we have even better news, albeit not for the brothers Cajee. You haven’t lost even that $200 million. By the standards of bitcoin breaches, you’ve lost the equivalent of nothing at all, although in real-world terms it’s still quite substantial.

He added that no more than $5 million is unaccounted for.

And maybe you’ll even see it someday.

Raees Cajee said that he and his brother plan to return to South Africa to attend a July 19 court date tied to the liquidation proceedings for Africrypt.

Obviously, good news like this should reassure the institutions and trigger a rally (in a way bad news never seems to do the opposite), and so it has!

Bitcoin prices rose for the second straight day in part due to news Morgan Stanley bought 28,289 shares of Grayscale Bitcoin Trust through its Europe Opportunity Fund…. Additionally, noted stock picker Cathie Wood's ARK Invest is entering the Bitcoin ETF race….

And, hey, wouldn’t you know that the Fed’s number two has something to say touching on that, although he uses it to draw a conclusion arguably favorable to the cryptoverse.

Citing America’s “susceptibility to boosterism and the fear of missing out,” Mr. Quarles warned that the nation has a habit of falling victim to a “mass suspension of our critical thinking and to occasionally impetuous, deluded crazes or fads.”

This man was appointed by Donald Trump.

He invoked the parachute pants of the 1980s as a parallel to the current currency craze, noting that sometimes fads are just silly…. Mr. Quarles said he does not want to prejudge the process, but he thinks there’s a “high bar” for central bank-issued digital money….

“In my judgment, we do not need to fear stablecoins,” Mr. Quarles said. He argued that the Fed has a history of fostering private sector innovation and “a global U.S. dollar stablecoin network could encourage use of the dollar by making cross-border payments faster and cheaper. And it potentially could be deployed much faster and with fewer downsides” than a central bank version.

Raees Cajee, Blamed by Investors for Billions of Dollars in Crypto Losses, Says Fraction Is Missing [WSJ]
Bitcoin price pierces $35,000, ETF race heats up [Fox Business]
A top Fed official says digital currency may be the money equivalent of parachute pants. [NYT]

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

Which means its time for the semi-regular reminder that bankers and other market players do not only manipulate interest rates, which they do, all the time, and not only Libor, but can, will, and do manipulate everything they can, which is to say pretty much everything, all the time.

Emilio Jose Heredia Collado…. was arraigned Tuesday in San Francisco federal court on one count of conspiracy related to trading through a process managed by oil-price benchmark publisher S&P Global Platts. Mr. Heredia directed other traders to submit orders that would push up or down prices, to engineer a move that would improve the profitability of other transactions in physical fuel oil….

The case targets conduct first revealed by The Wall Street Journal in 2013, in an article that showed traders admitting they could manipulate prices on the Platts system…. Authorities in Europe have investigated whether trading firms such as Glencore, Vitol and Gunvor Group Ltd. manipulated prices through the Platts process…. The Commodity Futures Trading Commission, a civil regulator in the U.S., also probed the allegations more than a decade ago.

And Heredia—a former Glencore trader who’s expected to plead guilty to the charges—wasn’t shy about it, either. We’re not talking about a handful of basis points here.

In one example cited by prosecutors, Mr. Heredia in 2016 directed a co-conspirator to submit offers to Platts during the pricing window for a low-grade fuel known as “bunker” at the port of Los Angeles. The other trader subsequently lowered the price more than 40 times to push down the Platts benchmark, according to prosecutors…. The activity had the effect of moving down the price from an average of $245 a metric ton to a final price of $204.50 a metric ton….

Former Glencore Oil Trader Charged With Manipulation of Fuel Prices [WSJ]
Libor Transition Goes on Even With SOFR Term Rate Uncertain [Bloomberg]
Fed’s Quarles Says ‘Finally Time’ for Everyone to Ditch Libor [Bloomberg]

“The COVID event is not behind us yet,” Randal Quarles, the Fed’s vice chairman for financial regulation, said in prepared remarks. “We know that the financial system will face more challenges.”

Shares of hotels, airlines, restaurants and other companies that have been heavily affected by coronavirus-related lockdowns initially perked up when states began easing restrictions on business and travel. But as the number of coronavirus cases has risen across the U.S. and some states have halted their reopening plans, many of those stocks have fallen behind again… The S&P 500 is trading at roughly the level it was one month ago. In contrast, shares of American Airlines Group Inc., Norwegian Cruise Line Holdings Ltd., Carnival Corp. and Wynn Resorts Ltd. have each fallen at least 27% over the same period…. Another group of stocks that have suffered? Large event operators, which have been hit with cancellations of festivals, concerts and other mass gatherings. Live Nation Entertainment Inc. is down 21% over the past month.

Globally, 552 private-equity funds reached their final close in the first half of the year, 31% fewer than in the same period last year, according to data provider Preqin Ltd…. At the same time, the total amount of money raised for private-equity deals showed a smaller decline….

The U.K. government announced up to $38 billion in fresh stimulus measures intended to boost the country’s economy as it exits lockdown, a path that is also being considered by other rich nations as they seek to prevent the economic shock of the pandemic from snowballing into a multiyear slowdown that could leave deep scars on their societies, businesses and economies.

U.S. Stocks Edge Up While China Rally Powers Ahead [WSJ]
Covid Still Poses Challenges for Financial System, Fed’s Quarles Says [WSJ]
The Reopening Trade Is Stalling [WSJ]
Pandemic Slowed Private-Equity Fund Closings in First Half [WSJ]
U.K. Pumps Billions Into Its Ailing Economy to Keep Crisis at Bay [WSJ]
Here’s exactly how detached from reality Donald Trump is on the coronavirus [CNN]

J.P. Morgan analyst Vivek Juneja reiterated the underweight rating he's had on the stock for the past two years, writing in a note to clients that "concerns about dividend cuts have weighed on Wells Fargo recently because it has the highest payout ratio among our banks and also because of remarks by [Federal Reserve] Vice Chair [Randal] Quarles."

And if this spurning gets Wells thinking it might like to look like still another bank, well…

Regarding speculation by some of a merger between Wells Fargo and Goldman Sachs Group Inc., Juneja said any bank acquisition by Wells is "banned by law" as the bank already exceeds the 10% deposit market share limit.

Wells Fargo’s stock sinks further after J.P. Morgan reiterates bearish view amid concerns of dividend cut [MarketWatch]

Still, there are signs that after two years something might actually get done. And that something may come from the place Trump spends much of his executive time railing against: the Federal Reserve. Having already moved to ease the stress of stress tests, specifically by handing out cheat sheets all over Wall Street, the Fed is ready to make things even easier on some banks.

Federal Reserve governor Michelle Bowman called Monday for regulators to “develop and refine” how they supervise community banks “to fit the smaller size and less-complex risk profiles of these banks….”

It is “crucial,” she said, to “balance effective regulation and supervision to ensure the safety and soundness of community banks while also ensuring that undue burden does not constrain the capacity of these institutions to support the communities they serve.”

And contra the America First approach of the Trump administration, the Fed hopes to extend the benefits of lasseiz-faire for the small bank across the globe.

“If reforms are unnecessarily burdensome and we can achieve strong resiliency more efficiently and simply, we should be able to boost sustainable financial and economic activity, thus benefiting everyone,” he said.

Specifically, the FSB is examining the effects of reforms on the financing of small and medium enterprises, “the lifeblood of many of the world’s economies,” Mr. Quarles said. The board is also in the process of launching a separate study on the effects of reforms aimed at ending “too big to fail” banks, he said.

Federal Reserve’s Bowman Calls For Refined Oversight of Community Banks [WSJ]
Fed Official Calls for Revamp in the Way Financial-Sector Threats Are Assessed [WSJ]
Fed gives banks more stress test information, unveils 2019 scenarios [Reuters]

The midterms are over. Donald Trump is either a lame duck or two years from elected Greatest Most Beautiful and Perfect President of America for Life (and, taking a page from the leaders he most admires, maybe beyond). That means the time has come to get that regulatory bonfire going in earnest, while there’s still time, starting with making stress tests multiple choice. And we’re not talking LSAT problem-level multiple choice. We’re talking old-school Global Studies Regents exam level multiple choice.

Fed Vice Chairman of Supervision Randal Quarles in a Friday speech said the agency was considering revisions that could make the test scenarios more consistent from year to year and give firms their results before they wrap up shareholder-return plans… Banks will likely welcome what Mr. Quarles outlined as a sweetening of an April proposal that was already set to ease the stress-testing burden….

Mr. Quarles also recommended that financial institutions with less than $250 billion in assets, which include SunTrust Banks Inc. andFifth Third Bancorp , should skip the 2019 tests as they are set to enter a two-year evaluation schedule under a different Fed proposal.

Fed to Further Overhaul Stress-Testing Regime, Making it Easier for Banks to Pass [WSJ]

But perhaps the most interesting part of these minutes was a vigorous debate over the correlation between the unemployment rate and inflation. Once upon a time, there was a pretty clear relationship between the two: A low unemployment rate meant the economy was using up most available resources, thus causing inflation to rise. The cure? Higher interest rates to prevent runaway price increases.

But in today’s global economy, there appears to be no end to the ability of businesses and consumers to keep a lid on prices— whether the result of an increasingly global labor market, or easy online price comparison—and the Fed hasn’t a clue how to respond. The minutes from the most recent meeting show some hawkish board members blaming its decade-long inability to coax inflation to its 2% annual goal on “transitory” factors that will soon clear up, and that higher price growth is just around the corner. On the other side of the spectrum, there were members arguing for abandoning an inflation target altogether, in favor of targeting nominal GDP growth instead (i.e. a combination of real GDP and inflation). This would, theoretically, signal to markets that the Fed would be willing to accept significantly higher-than-2% during periods of slow real growth, like we’re experiencing today.

Specifics of the debate aside, that it is being had at all, and that the poles of the discussion are so far apart, should give investors pause. After all, it’s the Fed’s job to keep inflation and unemployment low and stable, but there is very little agreement on how to achieve this, or why it hasn’t been able to hit its inflation goals thus far.

What this means for markets is difficult to say, because those who are supposed to understand the macroeconomy better than anybody are so divided and dumbfounded as to how it works. By selling off in the immediate wake of the Fed’s minutes released Wednesday, and new FOMC member Randy Quarles hawkish speech in Tokyo Thursday, investors seem to be taking the side of FOMC member Charles Evans, who dissented against the last hike on the logic that the global economy has evolved to constrain the ability of firms to raise prices, and whatever wage gains result from tighter labor markets will simply have to be eaten by firms rather than passed on to customers, trimming margins and hurting equities. Worse still for believers in this framework, that this is the minority view at the FOMC means that the Fed could persist in hiking rates when the economy really needs more patience, risking a central bank instigated recession.

But the other side of the argument, articulated by Quarles Thursday, is that the global economy will soon be cured of its epidemic lack of inflation, and that the American consumer is finally healthy enough to absorb those price increases. Corporate profits, in this scenario, continue to grow with the aid of recent tax cuts, and the stock market continues to head higher.

The bottom line is that the Fed is all but throwing up its hands, and admitting that an increasingly globalized financial system—and market for labor and consumer goods—means that the old rules of monetary policy no longer apply. FOMC members are increasingly relying on their intuition rather than old models like the relationship between unemployment and inflation. Given that there are three empty seats on the FOMC, and an administration in the White House which has contradicted itself time and again on monetary policy, it’s near impossible to know which of these philosophies will win out in the end, and whether the argument that wins the day in the Eccles Building will be what Wall Street really needs.

Christopher Matthews is a writer who splits his time between New York City and Accra, Ghana, with an interest in the intersection of markets, the economy, and public policy. He previously held staff positions at Axios, Fortune Magazine, and Time Magazine, and has been published in Forbes and Debtwire.

It's hard to overstate how much these nominations will impact the future of the U.S. financial system. Yellen and Fischer's successors will need to manage the drawdown of the bank's balance sheet, as well as the gradual return to higher interest rates -- if indeed those things ever occur. They also will determine how far the deregulatory agenda of the Trump administration and Wall Street advances, especially since the Fed occupies a first-among-equals role in the financial regulatory world. Fischer, Yellen and others have launched a full-throated defense of the regulatory changes mandated by Dodd-Frank, but if Trump fills all four board seats with candidates intent on rolling back those rules or not enforcing them, they'll be able to vote through whatever changes they desire.

And, while Trump's nominations in other policy areas have ranged from curious to terrifying, all the rumored candidates for Fed posts have been a surprisingly vanilla and qualified group of standard Republican policymakers. Among those rumored and possible candidates for the board vacancies and chair positions include:

Gary Cohn - Washington insiders have assumed for months that Cohn is the frontrunner for Yellen's seat when it opens up early next year, but his recent decision to publicly contradict Trump's response to the events in Charlottesville reportedly has him iced out of the Oval Office's cool clique and is, literally, getting the cold shoulder from Trump. "Globalist Gary" is known to covet Yellen's role, and would there be any more gratifying ending to his devil's bargain with Trump than for the piqued president to nominate him to the Vice Chair role instead?

Kevin Warsh - A former board member who stepped down from his role in early 2011, and would likely only be enticed back for the bank's top role, though he could also be open to a role as vice chair on a board dominated by Republican appointees. He was the youngest nominee ever for a Fed board role when he was first appointed, but he impressed his colleagues at the time and acquitted himself well during the financial crisis. Transcripts of FOMC meetings at the time show other board members viewed him as the foremost expert on the workings of global financial markets. On monetary policy, Warsh would probably lead a more hawkish bank than Yellen or Bernanke.

Marvin Goodfriend: Goodfriend's name has been circulating as a potential board member as well. Goodfriend is a bona fide conservative economist who has been critical of quantitative easing and the low rates of the last decade. Goodfriend is a product of the Richmond Fed, which provides itself on focusing on price stability and whose presidents are often the most hawkish members of the FOMC.

Dr. John Taylor: In certain conservative circles, the nomination of Taylor would be a dream scenario and cause for celebration. The Stanford academic is a longtime critic of low interest rate policies, policy gadfly and creator of the eponymous Taylor Rule, a supposed tool for determining interest rates which conservative lawmakers occasionally threaten to make the Fed policymakers heed. It would be difficult for Taylor to get the votes needed in the Senate, however, and any cursory study into his beloved rule reveals that is actually not that useful to ... very wrong.

Randal Quarles: Quarles is already on his way to filling one of those vacancies and becoming the board's vice chair for supervision, a role in which, ironically, he will read the forces of deregulation into the breach.

Of course, these are the leading candidates assuming Trump continues with the weirdly buttoned-down approach he's taken to the Fed thus far -- an approach which has been slow and revealed the Fed to not be a major priority for the administration. We'll find out soon whether more interest rate hikes and a more rancorous debate about financial regulation drives Trump down a more unconventional path.

President Trump says a lot of things. He may even really mean them when they come out of his mouth. But then a new shiny object appears in his field of vision and he forgets, or one of his “geniuses” explains why perhaps just ripping up NAFTA or icing the Export-Import Bank—satisfying though it might be—is not the way to go, or a Dean Heller or Lisa Murkowski refuses to just sign off on whatever he wants at a given moment in time.

One of the things President Trump said, way back in January, that he was all set to “do a big number” on Dodd-Frank. This actually and unusually tracked with things he’d said before becoming president, when he promised the all-but “dismantling of Dodd-Frank.” He was even still on track a couple of days later, pledging to “be cutting out a lot of Dodd-Frank.”

Fortuitously, one of Dodd-Frank’s great defenders and implementers, the Torquemada of Stress Tests, Daniel Tarullo, decided he’d rather not stick around to see it shredded. This gave Donald Trump the chance to put a real Dodd-Frank hater in that crucial post, who could essentially become the pummeler-in-chief in the doing of that big number. So did Trump appoint this guy, who not only wants to get rid of Dodd-Frank but the FDIC, banks’ obligation to disclose the interest rates they charge and the Fed itself? No. He went with this guy instead. And this guy doesn’t seem to want to take Dodd-Frank out back with a crowbar and a sock filled with quarters.

“As with any complex undertaking, after the first wave of reform, and with the benefit of experience and reflection, some refinements will undoubtedly be in order,” Randal Quarles is expected to tell lawmakers, according to a copy of his prepared remarks released late Wednesday by the Senate Banking Committee.

Fed Nominee Quarles: Bank Rules Need ‘Refinements’ [WSJ]

For a guy with a well-deserved reputation for impetuosity, President Trump sure gets deliberate when it comes to formally nominating people to one of the 500-plus jobs he has to fill requiring Senate approval. In almost six very, very long months that he’s been president, he’s only gotten around to picking 176 nominees for 564 posts.

Some of this is out of his control: It can be hard to find good people, or any people, for some of the jobs, and only some of them are steering clear of a date on Capitol Hill to avoid the Trump stink following them for the rest of their lives. Perhaps slow-playing the nomination game is Trump’s cagey way of quietly dismantling the “deep state.” Perhaps Gary Cohn and Steve Bannon are practically getting into a fistfight outside the Oval Office ‘round the time nomination forms are to be signed. Perhaps keeping the president’s attention between making a choice and then actually nominating that person is all-but-impossible. Whatever the case may be, Randal Quarles has been Trump’s choice to become the first Fed vice chair for supervision (See? Obama could be a little tardy with the appointments, too) for three months now. Everyone knows it except for secretary of the Senate, who hasn’t seen a piece of paper with Quarles’ name and a 1600 Pennsylvania Avenue return address cross her desk yet. But she might! Soon! Maybe.

The choice of Mr. Quarles, expected for months and confirmed by a White House official Monday, would put a more industry-friendly voice in perhaps the most powerful U.S. bank-regulatory post: Fed vice chair of supervision….

Top White House officials had identified the vice chair post as a priority weeks after Mr. Trump’s election last year, and after an extended search process, officials identified Mr. Quarles as their top pick in April. At the time, Treasury Secretary Steven Mnuchin had indicated a nominee for the post was imminent.

Should Trump ever get around to actually signing Quarles’ nomination, here are a few things about him that you can be sure are making Elizabeth Warren very angry about it.

He has criticized the Fed’s policy of keeping interest rates near zero for years following the financial crisis, and advocated for a monetary-policy rule, or formula, to guide rate decisions….

Mr. Quarles, in a March 2016 Wall Street Journal op-ed that he co-wrote, said he didn’t support “arbitrarily taking an ax to big banks and irreparably damaging the economy.” He endorsed a review of postcrisis regulations but warned that “the consequence of a dramatic increase in bank capital is an increase in the cost of bank credit.”

On the other hand, it could be—and has been—worse.

Analysts and government officials have said nominating Mr. Quarles, an establishment Republican, would be a sign that the White House favors more incremental rather than radical changes to the Fed, an institution that has long engendered mistrust among the economic nationalists who backed Mr. Trump during his campaign last year….

The choice of Mr. Quarles “shows that we’re looking for a change to the heavy-handed approach to regulation from the prior administration,” the White House official said Monday. Mr. Quarles, the official said, “has a track record of working well with others to implement public policy.”

Trump to Nominate Randal Quarles as Fed Bank Regulator [WSJ]
Trump to nominate Quarles to be Fed’s top banking regulator [Reuters]

Marvin Goodfriend, a professor at Carnegie Mellon University, is in contention to fill one of three vacancies on the board, alongside Randal Quarles, a former Treasury Department official. Mr Goodfriend has a reputation as a free thinker who has been critical of some of the Fed’s crisis-era interventions but also willing to contemplate radical monetary policy….

At the same time, however, Mr Goodfriend has been willing to contemplate the use of deeply negative rates to stimulate growth — something that the Fed has thus far not embarked upon. In 1999 he wrote that negative rates were a feasible option, years before central banks started actually experimenting with them.

Meanwhile, Quarles’ nomination and confirmation means that Janet Yellen will be permitted by Jeb Hensarling to do her job, at least until it becomes Neel Kashkari’s job.

Trump considers negative rates advocate for Federal Reserve role [FT]
Trump Said to Pick Nominees for 2 Positions on Fed Board [NYT]
Trump Considering Economist Marvin Goodfriend for Fed Board [WSJ]
Trump set to make first moves at completely revamping the Federal Reserve [CNBC]

Last week, Daniel Tarullo—the Fed’s de facto vice chairman for supervision and the Torquemada of banking regulation, who spent eight years crafting the most diabolically cruel stress tests ever countenanced by man or beast—stepped down from his post. Like many others, his now-former boss excepted, he chose to bow out and give President Trump a free hand in implanting his YOLO financial regulatory scheme. But before returning to the place people like him belong in the MAGA era—the academy—Tarullo offered some words of wisdom to his successor, if President Trump got around to appointing him. Other than the surprising admission that the Volcker Rule should probably not be given the chance to outlive its aged namesake, it was a pretty par-for-the-coursevaledictory for Tarullo.

He offered up some fixes, including increasing beyond $50 billion in assets the threshold for banks that are labeled “systematically important” and require additional Fed oversight. He also said $10 billion in assets was too low a threshold to require banks to do their own stress tests. And he conceded that local and community banks should not be subject to the same Dodd-Frank requirements as the big banks….

“As proposals for regulatory change swirl about,” Mr. Tarullo concluded, “it is crucial that the strong capital regime be maintained, especially as it applies to the most systemically important banks. Neither regulators nor legislators should agree to changes that would effectively weaken that regime, whether directly or indirectly. It would be tragic if the lessons of the financial crisis were forgotten so quickly.”

I guess they weren’t teaching Marx at Roxbury Latin, Georgetown, Duke or Michigan Law School when Tarullo was around, at least not the part about history repeating itself first as tragedy and then as farce. Because the people in charge these days certainly seemed determined to repeat history as a rather tremendous farce. In other words: Tarullo was wasting his breath. No one, outside of the polite audience at Princeton, was listening.

But maybe those vocal exertions were not for naught, after all. For Gary Cohn continues to chalk up victories in his battle against Steve Bannon, whose “destroy the administrative state” agenda would probably have best been fulfilled by leaving the Fed supervisory role vacant in advance of its eventual abolition. And that means that the guy likely to get Tarullo’s job, Randal Quarles, sounds an awful lot like Tarullo.

Mr. Quarles said in a 2015 interview with Bloomberg TV that repealing the Dodd-Frank law altogether is “politically very difficult,” but that significant changes to the law were worth considering. In some respects, he said, the regulatory overhaul was “not ambitious enough,” while in other ways “it was overly ambitious.”

Mr. Quarles is seen as less ideological than other candidates the Trump administration had considered for the job.

In Farewell, Daniel Tarullo Offers Fixes on Bank Regulation [DealBook]
Randal Quarles Set to Be Named to Bank-Supervision Post at Fed [WSJ]