Money Minute: Big Banks Ring Up Big Profits; Mortgage Rules Get Stricter

Too big to fail and getting bigger.

The nation's big banks had their best year in 2013 since before the financial crisis. Thomson Reuters estimates the six biggest banks will report a combined profit of $73 billion. That's up 22 percent from the year before. JPMorgan Chase (JPM) and Wells Fargo (WFC) report earnings next Tuesday. Citigroup (C), Bank of America (BAC), Goldman Sachs (GS) and Morgan Stanley (MS) all report later in the week.

bank profits
Sue Ogrocki/AP

The New York Times says the huge profits could allow those and other big banks pay up to $50 billion to settle charges arising from their role in the mortgage crisis. If that happens, it could benefit some homeowners by reducing the size of their monthly loan payments.

Meanwhile, new rules take effect today designed to protect consumers against the risky lending practices that led to the housing crisis. The intent is to make sure borrowers can afford to make the payments on the mortgages they take out.

The Dow Jones industrial average (^DJI) fell 18 points Thursday, and even though it may seem that the market has had a rough ride so far this year, the Dow is down less than 1 percent. The Nasdaq composite (^IXIC) fell 9 points and the Standard & Poor's 500 index (^GPSC) was virtually flat for the second day in a row.

A generation ago, Sears and J.C. Penney were two of the most popular retailers around. But they've both fallen on hard times -- with consumers and with investors. Sears (SHLD) reports a key measure of sales over the holidays tumbled by 7 percent from a year ago, and it now expects a big loss. As for J.C. Penney (JCP), it barely avoided bankruptcy last year, but hasn't been able to reestablish a positive identify with shoppers. Over the past year, Penney's stock has fallen nearly 60 percent, and Sears is likely to take a big hit Friday.

Analysts say many retailers marked down prices so much during the holiday season that they cut deeply into potential profits.

-Produced by Drew Trachtenberg.