Bank of America Corp (BAC), JPMorgan Chase & Co. (JPM), Citigroup Inc. (C): Prepare for the Q2 Earnings-Season Bloodletting

Even when we compare the rate action over the past quarter to 2004, there are positives. In 2004, some parts of the yield curve were starting to flatten — that is, basically the opposite of the spread-widening situation that I outlined above.

Source: U.S. Department of the Treasury.

The rate gains this year have been distinctly the good kind (if you’re a bank), leading to a steepening curve.

Source: U.S. Department of the Treasury.

And here’s the real optimistic slant on all of this: A steeper yield curve is typically seen as a sign of better economic times. A healthier, growing economy is good for banks. Of course, a healthier, growing economy is also good for all of us.

The article Prepare for the Q2 Earnings-Season Bloodletting originally appeared on Fool.com.

Matt Koppenheffer owns shares of Bank of America and JPMorgan Chase. The Motley Fool recommends Bank of America and Wells Fargo. The Motley Fool owns shares of Bank of America, Citigroup, JPMorgan Chase, and Wells Fargo.

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