There's an intriguing idea here that it's good for the talent to disperse to smaller institutions. That it will be a sort of Darwinian process that whittles big banks down until they're no longer too big to fail. And it creates a more diverse Wall Street in the process.

Well, really? It seems to me that's no longer true if a handful of the big banks (say Goldman Sachs or JPMorgan) are able to pay off their TARP funds early.

Shrinking Citi and Bank of America to beef up Aladdin Capital and Broadpoint may be dandy and help the too-big-to-fail problem. But aren't we just as likely to be shrinking Citi and Bank of America to enlarge Goldman and JPMorgan?

I'm not suggesting anything in particular other than that I'm not sure this talent reallocation really does anything material to the bank size issue.