diff --git a/node/node.go b/node/node.go
index 5620f1bb..892a0c80 100644
--- a/node/node.go
+++ b/node/node.go
@@ -658,9 +658,7 @@ func (n *Node) ConfigureRPC() {
 	rpccore.SetConsensusReactor(n.consensusReactor)
 	rpccore.SetEventBus(n.eventBus)
 	rpccore.SetLogger(n.Logger.With("module", "rpc"))
-	rpccore.MaxSubscriptionClients = n.config.RPC.MaxSubscriptionClients
-	rpccore.MaxSubscriptionsPerClient = n.config.RPC.MaxSubscriptionsPerClient
-	rpccore.TimeoutBroadcastTxCommit = n.config.RPC.TimeoutBroadcastTxCommit
+	rpccore.SetConfig(*n.config.RPC)
 }
 
 func (n *Node) startRPC() ([]net.Listener, error) {
diff --git a/rpc/client/httpclient.go b/rpc/client/httpclient.go
index 79b41246..49c9796e 100644
--- a/rpc/client/httpclient.go
+++ b/rpc/client/httpclient.go
@@ -295,7 +295,9 @@ func (w *WSEvents) OnStop() {
 }
 
 // Subscribe implements EventsClient by using WSClient to subscribe given
-// subscriber to query.
+// subscriber to query. By default, returns a channel with cap=1. Error is
+// returned if it fails to subscribe.
+// Channel is never closed to prevent clients from seeing an erroneus event.
 func (w *WSEvents) Subscribe(ctx context.Context, subscriber, query string,
 	outCapacity ...int) (out <-chan ctypes.ResultEvent, err error) {
 
@@ -303,7 +305,7 @@ func (w *WSEvents) Subscribe(ctx context.Context, subscriber, query string,
 		return nil, err
 	}
 
-	outCap := 0
+	outCap := 1
 	if len(outCapacity) > 0 {
 		outCap = outCapacity[0]
 	}
diff --git a/rpc/client/localclient.go b/rpc/client/localclient.go
index 5b86a92f..080ca5d7 100644
--- a/rpc/client/localclient.go
+++ b/rpc/client/localclient.go
@@ -7,6 +7,7 @@ import (
 	"github.com/pkg/errors"
 
 	cmn "github.com/tendermint/tendermint/libs/common"
+	"github.com/tendermint/tendermint/libs/log"
 	tmpubsub "github.com/tendermint/tendermint/libs/pubsub"
 	tmquery "github.com/tendermint/tendermint/libs/pubsub/query"
 	nm "github.com/tendermint/tendermint/node"
@@ -31,6 +32,7 @@ powerful control during testing, you probably want the "client/mock" package.
 */
 type Local struct {
 	*types.EventBus
+	Logger log.Logger
 }
 
 // NewLocal configures a client that calls the Node directly.
@@ -43,6 +45,7 @@ func NewLocal(node *nm.Node) *Local {
 	node.ConfigureRPC()
 	return &Local{
 		EventBus: node.EventBus(),
+		Logger:   log.NewNopLogger(),
 	}
 }
 
@@ -52,6 +55,11 @@ var (
 	_ EventsClient  = (*Local)(nil)
 )
 
+// SetLogger allows to set a logger on the client.
+func (c *Local) SetLogger(l log.Logger) {
+	c.Logger = l
+}
+
 func (Local) Status() (*ctypes.ResultStatus, error) {
 	return core.Status()
 }
@@ -145,7 +153,9 @@ func (Local) TxSearch(query string, prove bool, page, perPage int) (*ctypes.Resu
 }
 
 // Subscribe implements EventsClient by using local eventBus to subscribe given
-// subscriber to query.
+// subscriber to query.By default, returns a channel with cap=1. Error is
+// returned if it fails to subscribe.
+// Channel is never closed to prevent clients from seeing an erroneus event.
 func (c *Local) Subscribe(ctx context.Context, subscriber, query string, outCapacity ...int) (out <-chan ctypes.ResultEvent, err error) {
 	q, err := tmquery.New(query)
 	if err != nil {
@@ -156,7 +166,7 @@ func (c *Local) Subscribe(ctx context.Context, subscriber, query string, outCapa
 		return nil, errors.Wrap(err, "failed to subscribe")
 	}
 
-	outCap := 0
+	outCap := 1
 	if len(outCapacity) > 0 {
 		outCap = outCapacity[0]
 	}
@@ -166,18 +176,20 @@ func (c *Local) Subscribe(ctx context.Context, subscriber, query string, outCapa
 		for {
 			select {
 			case msg := <-sub.Out():
+				result := ctypes.ResultEvent{Query: query, Data: msg.Data(), Tags: msg.Tags()}
 				if cap(outc) == 0 {
-					outc <- ctypes.ResultEvent{Query: query, Data: msg.Data(), Tags: msg.Tags()}
+					outc <- result
 				} else {
 					select {
-					case outc <- ctypes.ResultEvent{Query: query, Data: msg.Data(), Tags: msg.Tags()}:
+					case outc <- result:
 					default:
-						// XXX: client has missed an event. inform it somehow!
+						c.Logger.Error("wanted to publish ResultEvent, but out channel is full", "result", result, "query", result.Query)
 					}
 				}
 			case <-sub.Cancelled():
 				if sub.Err() != tmpubsub.ErrUnsubscribed {
 					// resubscribe
+					c.Logger.Error("subscription was cancelled, resubscribing...", "err", err, "query", query)
 					var err error
 					for {
 						if !c.IsRunning() {
diff --git a/rpc/core/events.go b/rpc/core/events.go
index 5139cd38..5188b871 100644
--- a/rpc/core/events.go
+++ b/rpc/core/events.go
@@ -93,10 +93,10 @@ import (
 func Subscribe(wsCtx rpctypes.WSRPCContext, query string) (*ctypes.ResultSubscribe, error) {
 	addr := wsCtx.GetRemoteAddr()
 
-	if eventBus.NumClients() > MaxSubscriptionClients {
-		return nil, fmt.Errorf("max_subscription_clients %d reached", MaxSubscriptionClients)
-	} else if eventBus.NumClientSubscriptions(addr) > MaxSubscriptionsPerClient {
-		return nil, fmt.Errorf("max_subscriptions_per_client %d reached", MaxSubscriptionsPerClient)
+	if eventBus.NumClients() > config.MaxSubscriptionClients {
+		return nil, fmt.Errorf("max_subscription_clients %d reached", config.MaxSubscriptionClients)
+	} else if eventBus.NumClientSubscriptions(addr) > config.MaxSubscriptionsPerClient {
+		return nil, fmt.Errorf("max_subscriptions_per_client %d reached", config.MaxSubscriptionsPerClient)
 	}
 
 	logger.Info("Subscribe to query", "remote", addr, "query", query)
diff --git a/rpc/core/mempool.go b/rpc/core/mempool.go
index b894d75d..48855b01 100644
--- a/rpc/core/mempool.go
+++ b/rpc/core/mempool.go
@@ -168,10 +168,10 @@ func BroadcastTxCommit(tx types.Tx) (*ctypes.ResultBroadcastTxCommit, error) {
 	// XXX: should be the remote IP address of the caller
 	subscriber := "mempool"
 
-	if eventBus.NumClients() > MaxSubscriptionClients {
-		return nil, fmt.Errorf("max_subscription_clients %d reached", MaxSubscriptionClients)
-	} else if eventBus.NumClientSubscriptions(subscriber) > MaxSubscriptionsPerClient {
-		return nil, fmt.Errorf("max_subscriptions_per_client %d reached", MaxSubscriptionsPerClient)
+	if eventBus.NumClients() > config.MaxSubscriptionClients {
+		return nil, fmt.Errorf("max_subscription_clients %d reached", config.MaxSubscriptionClients)
+	} else if eventBus.NumClientSubscriptions(subscriber) > config.MaxSubscriptionsPerClient {
+		return nil, fmt.Errorf("max_subscriptions_per_client %d reached", config.MaxSubscriptionsPerClient)
 	}
 
 	// Subscribe to tx being committed in block.
@@ -223,7 +223,7 @@ func BroadcastTxCommit(tx types.Tx) (*ctypes.ResultBroadcastTxCommit, error) {
 			DeliverTx: abci.ResponseDeliverTx{},
 			Hash:      tx.Hash(),
 		}, err
-	case <-time.After(TimeoutBroadcastTxCommit):
+	case <-time.After(config.TimeoutBroadcastTxCommit):
 		err = errors.New("Timed out waiting for tx to be included in a block")
 		logger.Error("Error on broadcastTxCommit", "err", err)
 		return &ctypes.ResultBroadcastTxCommit{
diff --git a/rpc/core/pipe.go b/rpc/core/pipe.go
index 34355223..0b760344 100644
--- a/rpc/core/pipe.go
+++ b/rpc/core/pipe.go
@@ -1,8 +1,7 @@
 package core
 
 import (
-	"time"
-
+	cfg "github.com/tendermint/tendermint/config"
 	"github.com/tendermint/tendermint/consensus"
 	"github.com/tendermint/tendermint/crypto"
 	dbm "github.com/tendermint/tendermint/libs/db"
@@ -74,14 +73,7 @@ var (
 
 	logger log.Logger
 
-	// config variables
-
-	// MaxSubscriptionClients mirrors RPCConfig.MaxSubscriptionClients
-	MaxSubscriptionClients int
-	// MaxSubscriptionsPerClient mirrors RPCConfig.MaxSubscriptionsPerClient
-	MaxSubscriptionsPerClient int
-	// TimeoutBroadcastTxCommit mirrors RPCConfig.TimeoutBroadcastTxCommit
-	TimeoutBroadcastTxCommit time.Duration
+	config cfg.RPCConfig
 )
 
 func SetStateDB(db dbm.DB) {
@@ -144,6 +136,11 @@ func SetEventBus(b *types.EventBus) {
 	eventBus = b
 }
 
+// SetConfig sets an RPCConfig.
+func SetConfig(c cfg.RPCConfig) {
+	config = c
+}
+
 func validatePage(page, perPage, totalCount int) int {
 	if perPage < 1 {
 		return 1