Good news for Visa!  

You know how you get that “teaser” rate on your credit cards or no interest for 12 months when you start? Well, that all goes away when you have a delinquency and then they get to hit you with 22% interest FOR LIFE AND penalties and then you are DOOMED!!!!  Well, 2.2% of credit card holders are now in that category, the most since the market collapsed in the sub-prime loan crisis.  

Of course, we’d never make that mistake again, right? So what have our beloved credit card companies been doing about it? Well, they issued over 20M new credit cards to subprime borrowers in 2015 and that’s up 56% from 2013. And the borrowers paying those crazy penalty rates are, of course, the ones who can least afford them:

Missed payments in states with large oil or energy sectors continue to worsen. The share of card balances that were at least 90 days past due increased 12% in Oklahoma, 10% in Texas and 20% in Wyoming in the third quarter from a year prior, according to TransUnion. The Wall Street Journal reported in April that rising unemployment in the energy sector was pushing up delinquencies on credit cards and auto loans, raising the risk of new losses for banks.

Don’t worry about bank losses – we’ll bail them out – where’s the risk in that? Speaking of criminal banking institutions,14% of Wells Fargo (WFC) customers have decided to leave the bank, the other 86% seem oblivious to the news. Of course the other banks are eager to meet the former WFC customers, so they can cross-sell the crap out of them! This is how the free market is supposed to work, where the customers punish wrongdoers by withdrawing their support. Unfortunately, you wouldn’t know there we wrongdoers without regulatory oversight and, even then, it apparently takes years and years to uncover.

Rather than put our money into WFC and expecting a recovery (and they are only down about 20% despite the fact that a lot of their profits turned out to be fraud-driven), how about looking at one of the banks that will benefit from new customers – like Bank of America (BAC), who had a nice jump in App downloads in the 30 days after the scandal broke at WFC (9/8). That makes for an easy inference that they will likely have a good 4th Quarter, right?