With one batch of Wall Street-friendly economic policymakers exiting the Obama administration stage left and likely to be replaced by a new crop of finance-industry insiders arriving stage right, the formal addition of Elizabeth Warren to the White House team can only be good news in the eyes of those who think that the politicians must be more aggressive when it comes to controlling Wall Street’s animal spirits. That’s certainly something that a banker like Richard Parsons—chairman of Citigroup and one of those rumored to be being considered as the successor to Larry Summers at the head of the National Economic Council—isn’t likely to do. After all, it was Parsons who last year publicly proclaimed his bank’s commitment to its shareholders and employees above all else.

Elizabeth Warren, in contrast, has a reputation for pulling no punches when it comes to her opinion of Wall Street and its shenanigans in the years that led up to the financial crisis of 2008. The banks, she said last year, are eager to have life return to the way it was pre-crisis, to resume making billions of dollars from consumers who signed loan agreements of various kinds without ever really understanding the products the financial institutions were pitching or the fees they would be paying.

She had nothing but scathing words for banks and other lenders that insisted their clients sign off on 30-page credit-card agreements and mortgage loans that ran into the hundreds of pages—none of which were designed to be easily read, much less understood, by the borrower. Banks, she said, seemed ready to declare all-out war on the concept of the readable contract and other “minimal” consumer protections.

So Wall Street’s critics may well rejoice in Warren’s appointment by President Barack Obama as an adviser to assist in the creation of the brand-spanking-new Consumer Financial Protection Bureau—an agency that was her brainchild in the first instance. Prior to that announcement, Warren described the new entity as the equivalent of a “tough cop on the beat,” one dedicated to ensuring that Wall Street’s profits don’t come at the expense of the financial health of Americans.

On the other hand, Wall Street itself may well be nervous. True, Warren has only been named as a special adviser to Treasury Secretary Tim Geithner, meaning that she doesn’t need to run the gauntlet of a Senate confirmation hearing. But the title still means that the Harvard law professor will be in charge of setting up the agency, from its structure and mandate to the terms of engagement.

By the time the White House is ready to name an official head of the bureau—likely not until sometime next year—Warren likely will have left an indelible stamp on the agency that will determine what kinds of financial products banks and other financial entities can market to Americans, and under what terms and conditions.

Even if she doesn’t get the Obama administration’s nod to take over as its official honcho at that stage, whoever does is likely to be cast in the same mold.

Ironically, both sides may well have less to celebrate or worry about than they believe. What Warren or her successors are able to accomplish at the helm of the new consumer financial protection agency is likely to be limited, simply by virtue of the magnitude of the task at hand. Meanwhile, Warren herself strikes StreetWise as being as much or more of a pragmatist as she is an idealist.

To begin with, what Warren—or any other head of the new bureau—is going to be able to accomplish will be constrained by human nature. Even if the new agency requires that credit card and other loan documents be drafted in plain English (something the SEC required corporations to do nearly two decades ago), that leaves plenty of room for foolish behavior on the part of individual borrowers.

It’s not enough to simply do away with confusing jargon and make the small print both larger and more explicit. Borrowers have to be able to read between the lines and make informed judgments. After all, printing nutritional information and offering transparent pricing on supermarket products doesn’t stop consumers buying foods that are bad for either their health or their balance sheets—or both. Marketing plays a role, and so does education.

Similarly, unless and until financial consumers are educated enough to read between the lines of the newly coherent and simplified disclosures, and to go beyond the slick marketing pitches to make comparisons between the various kinds of credit cards they are being offered, odds are that less may change than Wall Street fears and Warren and her advocates hope. The new bureau won’t be able to assign a personal financial consultant to every American family to advise them on their borrowing.

Then there is the reality—one that Warren herself shows signs of understanding—that the new agency can’t afford to be as hard-line as Wall Street’s critics hope. She has crafted her views of what the agency should be from outside the Street’s magic circle. In a Bloomberg television interview last week, she admitted that she needed to reach out to Wall Street “because I’ve got to learn.” Already, her language has begun to change as she begins making calls to folks like Citigroup CEO Vikram Pandit.

Formerly, she could be downright scathing about the kinds of loan agreements offered by banks, and their motivations in doing so, commenting on the irony of the fact that someone with $100,000 to invest in the financial markets gets better protection than someone who takes out a $100,000 mortgage. Her language of late has been noticeably softer, as she refers to credit-card agreements that are “still long…still hard to read…and still chock full of surprises.” No reference there to the banks’ motivations, just to the end result.

Warren’s goal, however, appears to have remained consistent—and it’s not as antibusiness or anti-Wall Street as some of her critics believe. From the start, she has argued that a consumer financial protection agency would level the playing field for all financial institutions. As things stand, she argued last year, a straightforward “plain vanilla” loan agreement that is sponsored by a community bank or a regional bank or even a credit union of the kind that might be just right for many consumers, can be overshadowed by multimillion-dollar advertising campaigns by the bigger banks.

One of her goals is to put all institutions and all products on a level playing field so that a consumer trying to evaluate the relative merits of four different credit-card contracts can understand readily which is the least expensive and which carries the least risk. That kind of approach, she has argued, is one that will pay off for both banks and consumers by highlighting truly innovative loan products, regardless of their source.

The next several months will be Warren’s trial period. She’ll have a chance to show her critics that her vision of a new financial order is one that can benefit them as well as consumers. It’s in the interests of all stakeholders in the financial system that she is able to balance all those competing interests.