Is anybody else baffled by the huge profits announced recently by Wells Fargo, JP Morgan, and other big banks?  I was scratching my head for a while.  We've just been through the worst financial system meltdown our country has ever seen, including massive bailouts as a last-gasp effort to keep many banks operating as viable businesses.  How can impeding insolvency suddenly change to massive profits, in the span of a few short months?

If you think of what's happened in the financial industry over the last six months, its easy to see what's happening.  If you're like me, credit card interest rates are skyrocketing.  My Capitol One card went from 10% to 15%.  I told them no, please close that account.  My Washington Mutual interest rose from 22% to 29.9%.  Again, I told them no, please close my account.  My USAA card rose 2 points from a very attractive 6.9%.  I really, really wanted to tell them no, but it was the best of the worst, so I'm keeping it open.

Most consumers have probably seen similar interest rate increases.  On the flip side, the Fed has lowered the interest rate banks pay on funds to near 0%.  The bottom line?  While costs have been decreasing, banks have used the financial crisis as the main reason to increase consumer interest rates.  The result is completely predictable as banks roll out reports of huge profits.  This is shameless and disgusting.  Karl Denninger from Market Ticker summed it up quite accurately with the cynical motto these banks seemingly follow: "Never Waste a Crisis".