Big banks are making it rain

Don’t worry, you can sleep soundly at night again—the biggest banks in America are A-OK.

In fact, they’re more than just OK. Despite a shaky macroeconomic environment, threats of new tariffs, and fears that an AI bubble could pop our entire economy, big banks have managed to keep the Wolf of Wall Street energy alive. A surging stock market, a comeback in all kinds of dealmaking, and a pickup in IPOs have created a perfect storm for banks to rake in the cash.

Just look at JPMorgan, which reported a 12% surge in profit last quarter. It was all thanks to a 25% increase in revenue from its trading desk, which helped the bank hit a third-quarter trading revenue record of $8.9 billion. Still, it wasn’t all sunny skies: JPMorgan’s credit losses hit $3.4 billion for the quarter, the highest rate since the first half of 2020. Shares sank 1.91%.

Wells Fargo also got an A+. Consumers spending more on credit cards, along with higher wealth management fees, boosted profits 9% to $5.6 billion last quarter. Shares rallied 7.18%.

Goldman Sachs’ Q3 profit jumped 37% to reach $4.1 billion, while revenue surged 20% to $15.18 billion, far past analyst expectations. The bank is now on track for its best year ever for its investment banking and markets business, according to the Wall Street Journal. Yet somehow, investors were still expecting better: shares dipped 2.04% today.

Finally, Citigroup bragged that every facet of its business posted record revenue during Q3. Its banking revenue surged 34%, while its markets segment reported a 15% increase in revenue. Shares rose 3.89%.

Do big banks = the economy?

There’s a reason economists view the banking sector as a bellwether for the rest of us: Trading, dealmaking, and consumer spending are all core metrics of a healthy economy. Today’s news means that the state of the nation’s finances may very well be in better shape than many have feared.

JPMorgan CEO Jamie Dimon himself said in a statement that the economy “generally remained resilient”, and added in a call with reporters that tariffs had—so far—hit the economy softer than even he expected.

Just remember, Wall Street isn’t synonymous with the entire economy. There are still a slew of risks ahead, including potential new tariffs on China. But that isn’t stopping the Street from popping champagne today, and expectations for earnings from Bank of America and Morgan Stanley tomorrow morning are now sky-high.—LB